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After a bumpy start, the iShares Silver Trust (NYSE: SLV) long position is recovering in sympathy with the climb in gold prices today, which itself is a reflection of continued weakness in the US dollar. Purely from a technical perspective, the SLV has established a bouble bottom corrective low around 15.60. The upmove off of 15.60/65 has just started and represents the basing portion of a sizeable bull flag formation that should provide the launch-pad for the start of a new upleg that projects towards 18.25/75 next. At this juncture, as long as 15.60/65 contains any forthcoming weakness, the bullish scenario will remain intact. Otherwise, my micro work points to a critical confrontation with key resistance at 16.45/50, which if (when) hurdled will unleash the upside potential of the anticipated new upleg. MJP 10/05/09 12:15 PM ET (16.10)
Mike Paulenoff is author of www.MPTrader.com, a real-time diary of his technical analysis & trade alerts on ETFs for precious metals, energy, currencies, and an array of equity indices and sectors, including international markets, plus key ETF component stocks in sectors like technology, mining, and banking. Sign up for a Free 15-day Trial!
