Tuesday, 26 April 2011

Roger Wiegand intuitive and technical spot on again. 2011-04-26

On Jay Taylor's show last week segment 5 for

http://www.miningstocks.com/radio/jayradio.php ,

Roger Wiegand said that we should be very careful at the $48-51 level for silver because there would likely be a correection on profit taking or an expectation of a top at the old top from 1980 at the $50 level. He said the correction could be $5 or even larger, up to $15. He was correct! As silver spiked up to $49.78 (price quoted by James Turk on Al Korelin's show 25/4/2011 here) this marked a top and there was an almost immediate $3 drop on and A-B-C correction - but there was more follow through and silver was down $5 in a 24 hour period, as shown so clearly on the Kitco multi-coloured 3-day chart (updated version at this link):
Wow! Red day = down day in this case! This drop is more than the entire silver price was 10 years ago. There was a parallel $22+ drop in gold too by the way.

My CMC Markets charts show a drop in gold from $1518.58 to $1492.85, a move of -$25.73 and silver moving from $49.826 to $44.636, a -$5.19 move. The ratio of these in $ terms is 4.96:1 ie 5:1 gold: silver $ move.

To work out the % move ratio (silver had been outperforming gold 6:1 on the upside, we can calculate this easily. It is % silver move / % gold move = 5.19/49.826*1518.58/25.73=6.15. Silver had 6.15x the downside move of gold, as against what I calculated on the upside move last week 6.25:1 in % terms. Silver is leveraged 6:1 vs gold on the upside and downside right now!

Thought for the Day:
I thoroughly recommend the interview with Nicole Foss, one of the most sensible interviewees on financial radio on Jim Puplava's Financial Sense Newshour this Easter weekend. It can be found at:


Title: "Nicole Foss- Preparing for the next Tsunami
The peaking of oil prices and the coming Depression. Resource Wars to follow."

One of her many statements: "I doubt very much that the Chinese Century will look like the American century did. There simply won't be the energy to support it."

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