Silver has been on a rampage for the last two weeks and looks eager to continue its winning streak. The powerful rally in the first few days of October not only exceeded three ‘external’ peaks on the daily chart without pausing for breath, it also gave way to a consolidation that looks capable of sling-shotting the futures into a second rally leg as powerful as the first. As long as each new thrust exceeds a prior peak on the daily chart, we can infer that the rally is sufficiently robust to continue. A further implication is that the pullbacks following each such ‘impulsive’ thrust will be corrective and therefore buy-able. Most immediately, expect December Silver to encounter tough resistance at exactly 16.253. I’ll be looking for a pullback there, possibly tradable. However, if the futures blow past it, the next stop would be p2=16.691, and thence 17.130. An easy move through that last number would imply buyers are ready to challenge May’s 17.850 peak, and possibly the one at 18.600 that occurred in January. _______ UPDATE (October 18, 6:58 p.m.): In seven days of tedious slogging, the futures have yet to touch the 16.253 resistance, let alone impale it. Neither have they fallen, however, so bulls still hold the edge and will continue to do so unless 15.375 is exceeded to the downside.
_______ UPDATE (October 27, 1:40 a.m.): Zzzzzzzz. The futures need to close above p=15.928 to set up a push to the nearest rally target, d=16.150 (see inset, a new chart).
