Thursday, August 2, 2007

Impending Silver Sell Signal

If the pattern of past cycles is roughly repeated, I would expect this Allocation System to generate a signal to sell some or all holdings of Silver within just days. By the end of next week (August 6 - 10) would seem very likely.

It will be a tough call as to whether this should be a signal to sell one-half of positions in (or leveraged to) silver or to sell all such positions in Ag. As of this writing, I would expect to sell all holdings of Silver &/or mining stocks highly correlated to Ag (Silver).

Since the last signal generated (July 5th) through today, SLV has returned 3.48% and GLD 2.28% Silver showing stronger relative strength as expected. The S&P500 (SPX) has declined 3.48% during that same period of roughly one month.