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Silver Poised for Breakdown

June 15 2011, 08:25

FMX Connect- WWW.FMXConnect.com (Reported on 6/15/2011)

Silver Poised for Breakdown

For the last couple of days we have been talking about our Bollinger Band/Implied Volatility indicator in Silver. This is the same indicator behind our prediction of Gold going to $1550. A bear flag is starting to form and we see all the conditions for a major wash-out. The Bollinger Bands are continuing to contract. When they start to widen in Opposite directions our indicator says to go with the direction of the midline with a stop out at the 20-day Moving Average. For a full description of how to use this indicator refer to the original story here.

Technical analysis from GRI is also bearish.

1. The downside objectives for this formation range from 3427.00 to 3227.00 with a close over 3653.83 needed to negate a bear trading stance.

2. Market is within proximity of this week's projected resistance range of 3765.21-3543.40, which may provide a likely zone for topping action or setbacks.

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