Back on June 11th I put out a video discussing the breakout potential for gold and how gold might be the surprise bull market for 2019. We got the gold breakout, and like usual silver lagged gold as the rally in precious metals started.
Last week things changed dramatically and silver broke through resistance signalling a Stage 2 breakout of its own. The volume on silver is exactly what you want to see from a Stage Analysis perspective, 3x average weekly volume (at a minimum to confirm a Stage 2 breakout you want to see 2x average weekly volume). The volume to start the week is high too with almost 20 million shares traded on Monday, which puts SLV on the potential track of nearly 100 million shares if this pace keeps up for the week.
SLV is starting to outperform the S&P 500 as well which is what we want to see in a Stage 2 breakout. There’s a little bit of resistance in SLV left around the $16 level but I wouldn’t be surprised to see that taken out fairly quickly if the volume remains high.
Disclosure: I am long SLV.
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