Is the bull market over in silver? Is it now doomed to see decades of decline with only failing rallies? Or is this week in silver more like the 1987 crash in the stock market, with SLV ready to recover and eventually make new highs?
I vote for the latter, that new highs for silver are out there, though it will likely take a while. It took two years for the 1987 stock market to make up that 40% lost during the crash month. It may be similar for silver. A one week 38% smack down on rising margin requirements isn't how long term bull markets typically make their final tops. I don't see a V-shaped recovery, so it isn't time to load the boat on silver. A lot of technical damage has been done to the silver chart, so I expect a lot more backing and filling. Indeed, SLV may have to go below 30 before making a short term low.
As always, no one knows the future, I am giving an opinion, and as always, I've been wrong before (like yesterday when my trading account saw its worse day of the year).
The gold chart still looks constructive, with a decent base for GLD at 140. Textbook would be a pullback to the 50 day moving average and then new highs. It is rare to get textbook charts in real time though.
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