Technical Analysis April 3, 2012 – Silver

3 Year Weekly Silver Chart

There are a couple of interesting and conflicting items in the chart above.  First, we have a RSI which is at 50 and turning up which is good.  Then we have a PPO which appears to be getting ready to cross the signal line and move lower which is bad.  Then we have a seasonality which calls for the yearly March selloff in Gold and Silver. 

Now looking at the price chart above one can see a clear reverse head and shoulders formation being traced out.  A breakout would put a price target of roughly $46 an ounce on silver.  The question becomes ‘Do the seasonal factors outweigh the technical signals and if so does the pattern break or do we just see a continuation of the right shoulder?’

The 2012 First Quarter Update will be coming within a week.

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