Silver spot price (SILV-31.97, see Figure 30) has been weaker than Gold, and the recent rally failed at the resistance of the broken support near 35. If support at 30 fails to hold, Silver could be due to pull back toward the 2008 uptrend near 25, with the outside, worst case, possibility that even 20 (a full pullback to the multi-year breakout) could also occur. The strong and swift 170% advance into 2011 followed by the 46% decline will also require time to repair, inclusive of price pullbacks.
Notice that the weekly momentum model continues to decline (see arrow), suggesting potential further price attrition, or at least further sideways trading. Here, too, the corrective behavior could carry into next year against dollar strength. Eventually, were price able to move through 35-37, a challenge of 40 could again come into play, but we don’t see this over the near term.
Louise Yamada
Read more @ ORIGINAL SOURCE
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