OilBull.com

Jan 25, 2012 11:30 PM EST – The price of silver closed at $33.092 today, up $1.61 per ounce for a gain of 3.6%. Electronic trading in New York added another $0.178 to close the session at $33.27 per ounce.

Visit OilBull’s 24 Hour Live Silver Price page for live silver price charts and today’s update.

Source: www.kitco.com

There were two big drivers behind today’s price action. Apple earnings, which yesterday had stock futures trading up after hours, was first on deck. While Apple opened much higher, the broad indexes were mostly trading lower, with the exception of Nasdaq. Traders were apparently waiting for Bernanke to provide a green light with more QE talk. The FOMC announcement came, and everything ramped, including silver prices. The fact that nothing but Apple was up early on, and in fact a lot of stocks were selling off at the end of the day, should serve as a red flag.

Silver initially traded down roughly $0.40 this morning before the nearly 4% run higher on the Fed Announcement. Yesterday we had suggested a $0.30 – $0.35 dip in prices was just enough to form a mini-trough that traders might be able to buy. That was close enough.

It appears as if traders were simply looking for nothing to dissuade them from continuing the rally in the Fed statement and Ben was particularly dovish in his comments, or at least dovish enough to continue the “buy” programs that bots trading markets have been running.

Here is where we might provide a little caution for equity buyers tempted to join the party late. Apple gapped up above its upper trend line and failed to gain much after that, printing a red down candle by the end of the day. Could that have been a final exhaustion gap? Bull markets and rallies end on good news, afterall. Google continues to sell off, having broking through its bearish rising wedge. Volume continues to remain light. Bearish divergences have been developing on several technical indicators throughout the rally. Shorts continue to be light, which is bearish.

The silver price is now up well north of 25% since its last bottom. Is that enough for the silver traders? We know the physical silver buyers are looking for those $60-100 silver predictions to develop over time and are not really concerned that silver might pull back hard when equities get the rug pulled out from under them. True silver stackers welcome the pull-backs, always hoping to acquire just a few more ounces before prices begin to reflect the true state of silver supply and demand.

If paying attention this morning, you will have noted that the premium in Sprott’s Physical Silver Trust (PSLV) got down to under 5%. It finished the day at 5.46%. If still buying funds, don’t let last week’s offering that took out the 30% premium scare you away. Now may be a better time than ever to buy PSLV over other paper silver investments. Check out how rarely the PSLV Premium has dipped below 6% since the trust’s inception. If Sprott’s Physical Silver Trust begins to add back premium, while silver prices are going up, this could be a way to gain more upside. If the premium increases while silver prices are falling, this fund may provide some downside protection. Granted, the premium could shrink from here, providing more muted gains, as it did in fact do today. [Silver Update Archive]

Visit OilBull’s Current Silver Price page to view today’s update with multiple live 24 hour silver price charts in 10-second to weekly time-frames.

Jan 24, 2012 07:30 PM EST – January Silver settled COMEX today at a price of $31.921, down $0.302 or just under 1%. Electronic trading in New York added another $0.13 to the price, finishing the session at $32.05 per ounce.

Price action in equities, as well as silver, was subdued as traders waited for the Fed FOMC statement on Wednesday, nervously eyed the impending Greek default talk in Europe and prepared for a key earnings announcement afterhours. A “pullback” for the silver price was not unexpected today after a 5.7% gain over the prior two days. We added quotes because one can barely consider less than a 1% move, representing only 17% of the two-day gain, a pullback. One would normally expect even better entry points tomorrow as selling accelerates into a mini trough, perhaps at a 38% Fibonacci retracement of the breakout move (which would take the price down another $0.30 to $0.35), if not trading down to test the $30 breakout area altogether (real silver buyers wouldn’t wait for that).

source: www.kitco.com

However, all bets are off on trying to predict prices for tomorrow. Note the small pop in silver prices at the end of electronic silver trading in New York today. We did get that earnings announcement, with Apple revealing blowout top and bottom line results after the market closed. This propelled stock futures higher and perhaps carried silver prices with them. As Apple earnings dominate the headlines, one might almost forget that we were waiting to hear from the Fed tomorrow afternoon. This is where the financial press has its work cut out for it. If stocks continue to surge on the presumption that all is well, citing Apple earnings as the evidence, then how can the Fed justify easing further? What if everything rallies, regardless of what the Fed does? Can the Fed disappoint with no easing dialogue, if market participants decide easing isn’t even needed because all is well? Can the Fed spin it this way, getting higher equity prices, without having to ease further? We can already hear the argument: Everybody in the world is buying iPhones and iPads, so the markets are in a position to rally on fundamental growth, which is taking place. Who needs QE to keep pushing higher? The global economy can’t be that bad, can it? Can it? Hello?

Are those crickets chirping, or just the distinct ring one hears as silver bugs continue stacking physical. [Silver Update Archive]

Visit OilBull’s Current Silver Price page to view today’s update with multiple live 24 hour silver price charts in 10-second to weekly time-frames.

Jan 23, 2012 07:10 PM EST – The silver price today settled COMEX at $32.333, up $0.0586 or 1.9%. Globex electronic trading in New York only added another $0.02 before the session ended.

source: www.kitco.com

Why were silver prices up today? Euro strength probably helped. Another rumor was passed off by the Financial Times with an hour to go in equity trading, causing virtually all risk asset classes to ramp, just as they were beginning to roll over. The rumor / denial game gets old after awhile. Many are increasingly buying into the rally on hopes that the Fed will hint further at additional easing later this week. If not that, they are hanging their hat on technicals. We saw at least one “this time its different” article published by a technical analysis blog. The more they buy in, the riskier the markets get. There is an utter lack of volume, and a sharp decline in short interest, both of which should be viewed as bearish.

After Friday’s breakout rally, the silver price felt somewhat muted today, even though it managed to climb nearly 2%. The bulk of today’s move was realistically a continuation of Friday’s rally during electronic trading Friday afternoon, followed by overnight trading in Asia. The dynamic today was a pullback into COMEX open, followed by a run higher, then a pullback throughout the rest of the day, with silver prices ending New York relatively flat. All the gains came outside of COMEX floor trading.

This is the difficulty with watching the world silver price on a 24 hour chart. The demarcation line for determining daily gains and losses is fuzzy. For many, simply watching the price for a Silver ETF is easier. Yet the reality is that the price of silver moves on a 24 hour basis. It is possible to purchase Physical Silver online at any time and often, the best time to buy physical at the best price presents itself during panic selling, sometimes outside of normal silver ETF trading hours.

For the current silver price update and live silver price charts, please visit OilBull’s Current Silver Price page.

Jan 20, 2012 06:30 PM EST – It was a spectacular rally today with the price of silver finishing COMEX up 3.8% at $31.65 per ounce for a gain of $1.17. It didn’t stop there as afternoon electronic trading in New York added another $0.59 per ounce, pushing the price to $32.20.

Silver performed decisvely better than gold today. Having pushed through the 50-day moving average, technical traders have been given the green light to pile in long, or perhaps cover short positions. This was a solid break above the $30 psychological resistance level too, which served to add fuel to the fire. Both the moving average and $30 price level have now become near-term support for traders.

The rally in Silver has now taken us back to mid-December price levels. What can we say? These explosive moves higher always come when least expected. This is the reason you can’t really trade your core silver position. You just don’t know when it is going to take off, and then keep running. This could be the start of a move to new highs, or it could be the tail end of a major bounce, with another leg down in store for us. At least one guru out there, David Morgan, predicts $60 silver for 2012 but has suggested that the move won’t come until later in the year. With long-term money, buy and hold your physical silver and then sleep tight.

On the Silver ETFs front, Sprott’s Physical Silver Trust (PSLV) did not keep up with SLV today. SLV gained 5.0% and PSLV only 3.7% during market hours. This continues to leave the premium on PSLV at a much more reasonable 9.1% versus the over 30% premium we saw just a few short weeks ago.

ZeroHedge maintains that the original premium in PSLV was most likely due to a shortage in physical silver, which of course pushes the price of physical silver higher. Today they posted an interesting article explaining today’s silver surge that suggests it was the direct result of Sprott applying proceeds from the offering announced two days ago. In our post on the Sprott offering and PSLV premium we suggested that it should be good for silver prices. ZeroHedge does a little speculative quantification as to how much good, which may make PSLV holders feel a little better.

For the current update and real time charts, please visit OilBull’s Current Silver Price page.

Jan 19, 2012 10:45 PM EST – The silver price was flat at the end of COMEX trading today, closing at $30.482, down $0.032 or 0.1%. The afternoon electronic session in New York however pushed spot silver back up to $30.64, adding nearly $0.16 or half a percent. Silver prices first gapped higher in the morning after overnight trading in Asia, but settled back down as floor traders decided enough is enough and began taking profits off the table.

The earlier session price slide can also be attributed to some defensive maneurvering in front of the slew of tech earnings due to be released in the afternoon. Indeed, Google disappointed and dropped roughly 10% in afterhours trading. Nevertheless, the broad equity indexes appeared to shrug off generally lackluster earnings and this may have been the green light for electronic session silver traders to march prices higher once again, leaving prices well above $30 once again. Tomorrow is another day, and skepticism remains valid, all the way up into new highs. If one is bearish equities and expecting a sell-off, one has to expect and accept a drop in the price of silver too. It doesn’t have to happen, and OilBull’s mantra remains the same. Buy physical silver now, for the long-haul and also keep powder dry for any major sell-off that materializes.

PSLV is already trying to add back its premium after yesterday’s 10% dive on Sprott’s announced offering. Perhaps in the end both camps in the PSLV debate will be correct. The premium portends silver shortages and a general distrust for SLV – iShares Silver Trust, but too much premium makes PSLV a dangerous trade that affords the fund the same status as any other paper silver product. Nobody has an algorithm that reveals what the right premium should be. Trade funds and consider the presense of a premium or discount an opportunity to leverage your position, or to arbitrage the difference between SLV and PSLV. Don’t neglect your physical silver and physical gold holdings, which may be the only real way to protect your wealth long-term.