Break in Price Channel, Volume Increase, CFTC

Silver and gold both broke through their respective upper price channel which puts to rest any call on a SHS pattern. I still think the dollar can rally but gold and silver appear to be ahead of that trade altogether. There was also large volume buying action on the 1 minute daily charts that pushed the prices higher. I suspect that some of this has to do with the CFTC saying that they would announce their position limit plan on Dec 16th.

I think that this is a bullish signal especially for silver due to the fact that there will now be position limits which should erase any large concentrated shorts by January. If we can close above the previous high on good volume that should remove all bets so I would advise a cautious long position.

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About Aaron Basile
Market Technician, Equity/Commodity Trader, Austrian Economist, Contrarian Investor

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