Loading ...Silver: Looking at the possibility of a drop to the $21 as it follows Gold down to the $1730 level
Maximum pain and capitulation before the rise.
An Evergrande default should shake up the mkts as more Real Estate companies follow. Real estate is a huge sector (25%) in China.
Just a guess at this point. A scramble for liquidity. Bail out???
Sir Columbia,
Bob Hoye is a very “measured” technical analyst. Certainly not a gold bug. Of course he draws a lot from historical charts, and we can never rule out that this time may indeed be different. Here’s his latest on silver. He agrees that the enthusiasm for silver above 23.75 may not sustain too long, so dropping back into the channel is very possible.
On the other hand, Sir Plunger had also said that he’d start nibbling at silver miners at around $21, and not wait for that elusive plunge to 17 or even 19. It didn’t happen, but we will await Sir Plunger’s update 🙂
http://www.321gold.com/editorials/hoye/hoye101621.pdf
I sold some more ASM for booking long term profits yesterday.
Thanks,
GL
Of course, given the manipulation that takes place in this space, anything is possible. However, I seriously doubt that given gold’s rise from 1720 to 1800 it is going to give back most of it to get near 1730. $40 or a 50% pullback is likely the worse case scenario. In the case of silver and Hoye(read his piece) it is more likely to reach the 200 day around 25.50 or so before that RSI becpmes problematic and leads to a Pullback to his 23.75 or so area that he believes would cap this rally.