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PMS Daily Digest for Wednesday July 30


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Time to Sell Silver?

 

SSRI's investor relations just sent this to me cause Dow Jones mentioned silver and PAAS & SSRI.

 

Be nice if we got a short SHARP correction in silver so some of us who didn't buy SSRI at $5 or less can get in again. :lol:

 

 

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3473 DJ 29-Jul-03 at 13:00:00 18:14

 

DJN =DJ TECHNICALLY SPEAKING: It's Hi-Ho For Silver Stocks

 

 

 

By Karen Talley

 

Of DOW JONES NEWSWIRES

 

 

 

NEW YORK (Dow Jones)--There's gold in that silver.

 

No, not ore, stocks - some fundamental and technical market watchers say silver stocks may come into their own again the way gold has, and should be owned.

 

It all has to do with supply and demand, the cornerstone of technical analysis. There is a shortage of silver, which means its price could rise. That's good news for silver stocks, which could ride the upswing.

 

The world stockpile of silver is probably close to 500 million ounces, anal cysts say. "But more significantly the U.S. government's strategic stockpile is now zero," said Ross Beaty, chief executive of Pan American Silver Corp. (PAAS) and president of the World Silver Institute in a recent letter to Richard Russell, editor of Dow Theory Letters. "The last sales from the formerly huge stockpile - over 2 billion ounces in the 1950s - was in late 2002 and that U.S. stockpile is now totally depleted."

 

Bottom line: The depletion of the U.S. supply "is very bullish for prices" since the only government in the world that now hordes huge stockpiles of silver is China, and inventory is being pared at a prodigious rate to fill the silver deficit, Beaty said.

 

Right now the ore goes for around $5.16 an ounce, having pushed past $4.90 and $5.15, which were both points of resistance - or spots that has met with selloffs in the past. Now that those levels have been breached, further gains in price are possible.

 

Aside from Beaty, whose stock in trade is to be bullish about silver, John Roque, senior vice president and technical anal cyst at Natexis Bleichroeder, also has positive things to say regarding demand dynamics that may drive up prices. Silver stocks "are firmly entrenched in longer-term uptrends," Roque said. "Both the metal and the stocks should work higher."

 

Beaty's company, Pan American Silver, now around $8.50, has been seeing significant rises on higher volume, which is a positive technical sign. For instance, shares rose 42 cents, or 6%, on July 23 on volume that was 600% greater than the average over the past month. The successful completion of a "big base," or a solid foundation for shares to spring from would imply an upside target of nearly $15, Roque said.

 

Apex Silver Mines (SIL) is another silver stock to watch. The company, at around $17, is also rising on much better than average value - on July 23, shares advanced 82 cents, or 5.6% on volume that was nearly 140% more than the average volume over the last month. The stock is firmly above its upward-sloping 50-day and 200-day moving averages - also good technical signs

 

- and a successful completion of its own base suggests a potential rise to 22, Roque said.

 

Silver Standard Resources (SSRI), at around $7, saw a one-day gain on July 23 of 64 cents, or 12% last week on 257% greater volume than it has seen over the past month and has been basing for the past 14 months between $3.50 and $6.50. Now that it has broken from that base, Roque is talking about upside potential in the 10 area.

 

In other words, the stocks have been chopping around for a while but as upside volume in all three shows, there are buyers out that and based on Roque's price targets, it may not be too late to join the silver bullets, er, bulls.

 

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Snippet from the Daily Reckoning:

 

For an entire generation, Americans have been the happy beneficiaries of a unique monetary system... in which the world's bussers and schleppers took American dollar bills in return for their work. The more dollars we exported... the more they bussed and schlepped to get them.

 

It was a little like the discovery of gold in America by the Spanish in the 16th century. All of a sudden, the Spaniards were the richest people in the world - for they had the world's money!

 

Money came in from the New World; it was as if the Spanish had a printing press in the basement and could print up as many dollars as they wanted. Even the word 'dollar' comes from that period, as Spanish money was known the world over. As the money supply increased in Spain, the first effect was inflation. Prices rose. But the second effect was the one that hurt. Rather than develop their own economy, the Spanish exported their dollars in exchange for the goods they wanted.

 

The Spanish thought they were rich. And, for a while, they lived rich. They were the 'world's mouth,' the leading consumers of the 16th century. But soon the money ran out. And its overseas adventures became cost-centers, rather than sources of booty. And then the Spanish discovered something important: the easy money had been a curse; it deprived Spain of the development needed to become a prosperous country.

 

After the Spanish Armada was defeated by the English in 1588, Spain fell into a slump. It was the 'sick man of Europe' for the next 4 centuries. And now it is America that is cursed by good fortune. It has become 'the world's mouth.'

 

As long as it has a printing press in its basement, Americans believe, they will never go hungry.

 

Still on the right side of the trade:

post-11-1059537863.png

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Got filled some more yesterday. On balance now 63% long pm's. As of currently, no bids or offers outstanding. Tend to believe the current correction won't be long. The degree to which stocks are accumulated is still quite high. Lastly, in a general sense, I feel the need to say that it has never been my intension to offend anyone.

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Time to Sell Silver?

The Earnings Game and Other Bull Markets (The Silver Streak)

 

.............Many silver bulls, I include myself as one of them, believe that the upside potential in silver is enormous. James Turk, editor of the Freemarket Gold & Money Report, thinks that silver could hit $6.45 by September. I personally believe that silver could actually go much higher.........

 

Puplava's Rant 29 July

 

Also, check out his "CRAP vs GAAP". Wonder if Puplava is a lurker? :P

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Thor, I sincerely hope not. :rolleyes: Just wanted to ensure that other posters know I respect them a lot. Like some others here, I'm someone who often THINKS he knows it better. I'm in therapy for such, but the problem appears, it's very deep rooted.

 

I truly enjoy this forum and learn a lot as well. I hope I'm able to reciprocate with a fair share of contribution from my side. So please, just take what I said as pre-emptive or as a sign of friendship.

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Me tinks this week will see the lows until the Sept/Oct highs.

Yoshaviah,

 

Have you got a cycle chart to illustrate your predictions? Please post it here.

 

Next level of resistance..

post-11-1059559298_thumb.jpg

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