Is there a possible Silver Trade Coming ?

We already know that the gold price has been blasting higher into all time new high ground and has ZERO resistance on the left side of the chart.  This is part of the reason why the gold price has been able to trade higher so persistently and now in what appears into a parabolic type fashion.

But what about silver or the SLV ETF ?  Silver has been lagging behind and is not at a new high yet, let alone all time record high.

There may be a silver trade developing when and if the SLV ETF can get a price move ABOVE 20.73.  The silver futures price above a price of 21 has very limited resistance all the way up to 49 which is the 1980 spike high.  So the possible trade is a momentum trade on an activation of 20.73 or higher on the SLV ETF.  Or some call options might be appropriate at that time.

Silver is basically be dragged higher by the gold price and we already know the gold price has exceeded its 1980 high so why can’t silver do the same thing? It will, but it will take time.  But I would not be too surprised if silver can make it to 50 some time in 2010.  It makes sense for it to do it soon since as I alluded to earlier there is almost no resistance from 21 to 50.

So for now silver is something to keep on watch as the precious metals frenzy continues to heat up into the end of the year and 2010 begins.

I will see if I can do some type of follow up here as we get closer to the previous 20.73 high.

Posted in Commodity ETF, ETFS

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