Silver’s Technical Achievements for the Week Leave Bulls In Command

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Silver Posts Impressive Results for the Week and the Month of August, Federal Reserve Hints at More QE at Annual Symposium in Near Future.

Federal Reserve Hints at More QE at Annual Symposium in Near FutureIn the previous week that concluded August 24th, you saw silver finally smash through longstanding technical resistance at $28.45 and $30 per ounce. This impressive dual achievement set the white metal up for a major move onward and upward over time, with even the last February high of $37 in silver’s gun sights now.

This past week that ended August 31st did not disappoint in terms of a follow up to a tough act, as the precious metal picked up where it had left off at $30.82 and never looked back. This marked the end to not only another strong week for silver, but to a powerful month of August for the metal too.

Silver Posts Impressive Results for the Week and the Month of August

It is important to keep in mind and have a perspective on how far silver has actually come this week and month of August as you consider why it continues to rise. Breaks of technical resistance usually lead to run ups in the prices of commodities such as silver.

This last week of August alone, spot silver closed at $31.74 per ounce, which represented a rise of over 3.3% for the week. That puts the metal’s spot prices up over 13% for August. By any measurement, those silver gains are impressive. Silver continues to lead and even outperform gold these days.

Silver’s Technical Achievements for the Week Leave Bulls In Command

Silver prices on the week ended up significantly higher, but this by itself was not the only sign that the bulls have taken command of silver prices this week and probably for the short to medium term.

The December COMEX exchange futures prices ended up at almost the session high, and the by the time the spot market closed for silver, the prices commanded the session high. Friday’s prices also marked a new four month high. The close also represented a higher close for the week and also for the month. Near term, the bulls will retain technical advantage with all of this in their favor.

Federal Reserve Hints at More QE at Annual Symposium in Near Future

The biggest fundamental story for silver this week turned out to be the remarks that emerged from the Federal Reserve annual symposium at Jackson Hole, Wyoming. Keep in mind that at this meeting a few years ago, the Fed first introduced the concept of quantitative easing, which means that they began to print money on a massive scale that has since increased the money supply of US Dollars by over three hundred percent.

This year, all eyes were on Chairman Big Ben Bernake to see if he would offer any hope of yet a third round of Quantitative Easing, in what he is making into an annual tradition. He made statements that fueled the fires of speculation that he will soon print more money when he hinted at both unconventional and fresh stimulus that he will introduce in the future.

Bernake only encouraged these hopes when he stated that he believes his quantitative easing is still able to bolster the American economy and lower unemployment in the process. You might say that he paved the way for a September Federal Reserve meeting announcement. Silver roared on the remarks from the Friday meeting. This is just what the bulls had hoped for and waited to hear for weeks and even months now.

With Silver on the Rise, Where Should It Head Next?

Silver market bulls now have several near term price objectives. The next significant resistance level is at $32.50 per ounce. Silver must close above this level in order to continue its relentless rise towards $37 per ounce that you last saw back in February. Support levels for silver are now a trifecta of psychological support at $30 per ounce, a second price at $31, and the closest one at $31.31.

Take Away On Silver Market Prices

The Federal Reserve has all but delivered on its long anticipated QE3 program now that the Jackson Hole Symposium is done. They have demonstrated that they can support silver prices by just stating their intention to print money. This unique capability supports silver from a fundamental perspective.

At the moment, technical breakout price action continues to thrust the white metal higher as well. So long as silver holds above these support levels that were previously resistance points, it will be difficult if not foolhardy to stand in silver’s way.

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