Tell that to zimbabwe who had treasury bill rates of 340% in 2007. With how much debt we have now, if interest rates go up, the government will have to borrow more money to pay its bills which causes more inflation which causes higher silver prices. We will NEVER see $5 silver again, thats a fact. Raising interest rates would also cause more housing problems that would cause more forclosures, that would require more bailouts which would require more money printing, which causes more inflation. No matter what happens, silver is going to go up. Only one way to make silver go down to $5 and thats if they find a new mine that can produce massive quantities of silver somewhere and flood the market.
The FED is not Zimbabwan and it's simply unfeasible to think that if the plans don't turn out to work they won't rather go for a debt restructuring than to keep doing what doesn't work.
I was thinking that silver was going parabolic too but I doubt it. Today it is pushing up against heavy resistance from the bottom trendline of the Sep to Dec trend channel. The price action right now was obvious once the prior high was taken out and we are seeing a huge short covering rally. The key is what happens tomorrow. If we fall back aggressively I would get out, if it breaks this resistance at approxiamately 34 to 34.40 then its vertical to god knows what. My 2 cents.
There are too many fundamentals to risk using Technical Analysis at this time. Look at this post I posted last month about silver going to $40-45 approaching march 1. As you can see...its starting to play out. The hedge funds look like they have pooled a billion dollars together and plan to force a huge cash settlement premium with the comex. http://www.elitetrader.com/vb/showthread.php?s=&threadid=213438
I whole heartedly agree with you especially in longer term. However, in my experience I need to know the important levels for my style of trading. Here I have posted a more detailed chart and you may be surprised at how well TA does work even in this crazy market. I definitely think that the US dollar will be worthless by 2014 and the few things standing will be gold and silver. The only thing I worry about are attempts to raise margin limits like they did against the Hunt Bros in the early 80's. Silver fell 50% in one day. However I think that a more likely scenario today would be COMEX bust and bailout by the fed.
The suckers always get stuck holding the bag at the end. Ride the bubble while it lasts... the last few pushes are always the biggest and most profitable moves. Just don't be stubborn about getting out when it turns. Poor barbers and taxi drivers always get stuck holding the bag! When cash4gold starts trying to SELL me gold rather then buying it then you know the price in in trouble...
......and all of this within a brand new paradigm shift of IMF pals setting up the new capability (new SDR's) to replace the USD as the worlds reserve currency. :eek: Game changer for many markets......game over for US economy as we once knew it. THEY have the US broke and up to our ass in debt and now THEY will pull the rug out (USD getting yanked as worlds reserve currency).........thank you privately held Central Banks, your plan is working! :eek:
SLV broke out on Thursday on good volume...wish I had just held my original position instead of daytrading it Thursday and Friday. Don't worry about it cratering. If it fails...it fails. Trade your plan. Momentum trades can go a lot further than you would ever think.
We still have a long way to get to hunt brothers prices in real terms. Adjusted for inflation we need to have silver hit $160 per oz to equal what it was in real purchasing power. I'm not saying TA doesnt work, but you dont want to try to pick a top with silver using TA. Using it for entry and exit points, I say fine...but I would definately not try to ride it down on the short side.