Silver Heading Higher - Market Analysis for Aug 10th, 2011

Looking at the iShares Silver Trust ETF (SLV) from a big picture perspective, all of the action off the major April high at 48.35 has carved out a base-like "cup" formation from early May to late July, which has been followed by a correction that has taken the shape of a "handle."

The composite picture produces a "cup-and-handle" intermediate-term bottom formation, which should propel silver prices and the SLV considerably higher in the upcoming days and weeks.

The first significant challenge to such an SLV rally will be a confrontation with that April-August resistance line, now at 41.00. As long as yesterday's low at 36.04 remains intact, I want to hold a long SLV position.

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