Silver Continues Higher, Great Western Minerals – Key Reversal

After being down for 10 out of the last 12 trading sessions, GWMGF finally finished significantly higher today and snapped an extremely rough trend.

If you follow my facebook you’ll find that at exactly 9:43am I said – “strong buy on GWMGF – trading below 50 Day MA” GWMGF was trading at $.69. Since then, it rallied $.12 for a daily gain of 13.27%.

The candlestick pattern for today’s chart is a bullish engulfing candle and at the same time, a key reversal. In other words, the bottom is in and it’s ready to move much higher, I expect a bullish engulfing candle on the weekly chart after friday’s close as well. Once again, I said last friday that support would be $.71 and the true trading range of today’s candle is $.71 – $.815. It should have enough momentum here to test $1 again by the end of next week assuming that on friday it closes above Monday’s open of $.78.

Silver is continuing to move higher as stocks are looking less attractive with all of the uncertainty and violence in the middle east. SLV finished higher again and for the 4th consecutive day accumulated over 30M in volume which has substantiated the breakout above $30.

We’re overbought from a technical standpoint and we will get a pullback next week, probably via a reversal on Tuesday. The pullback will be swift and support will be made on the 20 Day MA. I expect the 20 Day to be in the vicinity of $30 around the time the price meets it.

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

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