July 13, 2011
Shares of Ishares Silver Trust (NYSE: SLV) has been trading in a tight sideways band since its steep one week selloff back in early May.
SLV has a rising trend support line with initial lows at $33.32 and most recent lows at $33.00. SLV also has a declining trend resistance line with rally highs at $37.60 and then most recent rally high at $35.75.
This creates a pennant pattern for SLV.
Typically pennant patterns break in the direction of the previous trend. In this case that trend was to the upside.
Gold bullion is again nearing its highs and a potential breakout. SLV could follow to the upside but we recognize that this is a risky trade and sell stops must be used.
Support is currently at $33.00.
http://www.fibtimer.com does not currently have a position in Ishares Silver Trust.