Silver Makes 7-Year High, Gains +38% in July Silver has broken well above the long-term $20/oz resistance level that has capped price since 2013 and is now testing $25/oz which is a level not seen since 2013. Silver opened July at $18.20/oz and is currently at $25.15/oz for a +38% monthly gain going into August. While gold is making new all-time highs per-ounce above previous highs set back in 2011, silver is still well below its 2011 average of $35/oz and the 2011 all-time high of $49.83/oz, which is the level silver should be close to testing now if it had been keepig up with gold price this year. The current monthly price candle for silver is yellow which indicates that silver is experiencing bullish momentum volatility, or extreme trader optimism behind price.
The Relative Strength Index(RSI) shows the green RSI line rising above the purple signal line which indicates short-term bullish momentum on a monthly basis. The green RSI line is also above the 50 level which is the midpoint of the total RSI range(0-100). In general, price is considered to have bullish momentum when the RSI is above 50 and bearish momentum when below 50. In general during an uptrend, you want to see both the green RSI line and purple signal line both rising and trending above the 50 level. The purple signal line is just below 50, but it is slower to react to short-term price movement than the green RSI line but it should begin to drift up and above 50 after this months record month for silver price.
The Price Percent Oscillator(PPO) shows the green PPO line rising above the purple signal line, and both lines are trending above the 0 level. When the green PPO line is rising above the purple signal line it indictes short-term bullish momentum behind price. When both lines are trending above the 0 level it indicates bullish momentum behind price in the intermediate-term.
The Average Directional Index(ADX) shows the green directional movement line above the purple directional movement line which indicates a short-term postive trend hind price. When the green directional line is above the purple directional line it is considered bullish for price trend, while the purple directional line above the green directional line is considered bearish for price trend. The histogram behind the two directional lines represents trend strength. When the histogram is green and rising it indicates increasing strength in an uptrend. When the histogram is purple and rising it indicates increasing downtrend strength. For now the ADX reading is showing a shift to a bull trend in price with the green directional line above the purple, but due to the swiftness of the move in price it has yet to reflect in the histogram which should begin rising soon.
Overall, the view on silver remains bullish with the opinion that silver will outperform gold during the current bull market that is taking form. Silver had severely lagged gold this year in price gains until this past week and is now rushing to make up for lost time.
Current holdings remain to be: GPL, HL, EXK, AG, KGC, MUX, CDE, NGD, GDXJ, GDX and physical silver.
