The masses aren’t lining up to buy Silver right now, and that’s perfectly fine by us. That’s what they were doing in the spring of last year, seemingly oblivious to the downside risk in overbought conditions at $50 an ounce.
What’s so apparent right now, and again the masses are oblivious to it, is that an incredible BUYING opportunity has opened up in Silver and the evidence for that is overwhelming. Monday, Silver once again found buying support below $27 an ounce and closed at $27.06.
THE CHART THAT SAYS IT ALL
First, check out John’s updated long-term Silver chart that goes back to 1998. You’ll notice that RSI(2) – now at 7.7% – is very close to an extreme level witnessed on only one other occasion over the last decade – the Crash of 2008 when one of the best Silver buying opportunities in history was presented to investors. Unfortunately, many of them were too frightened to notice. TAKE NOTICE TODAY for potential massive profits in Silver, and Silver stocks.
BIG MONEY BETS ON RESUMPTION OF SILVER BULL MARKET
The SMART MONEY commercial traders get the picture. There’s a reason why they’ve trimmed their SHORT positions to near record lows, and why the DUMB MONEY traders (large and small specs) have LONG positions that are close to record lows. This makes for an extremely bullish COT structure, one of the most powerful ever seen. The commercials are rarely if ever wrong, so our money is on them.
Silver has been gathering internal strength recently while testing key support at and above its December lows. One of the strengths in Silver right now is its ability to stay within a small symmetrical triangle when other markets are falling. This is significant. At any point now during this third quarter, Silver’s breakout could begin. And those beaten-down Silver stocks will come to life.
SILVER STOCKS THAT COULD EXPLODE – RAINBOW RESOURCES (RBW, TSX-V) LEADS THE LIST AS A DISCOVERY OPPORTUNITY
Over the next week or so at BMR, we’ll be highlighting our 10 favorite Silver stocks – producers and quality exploration plays with very attractive risk-reward ratios. At the top of the list on the speculative exploration side is Rainbow Resources (RBW, TSX-V), a little known gem that’s preparing right now to drill its International Property in the prolific West Kootenay region of southeast British Columbia – home of some of the highest grade historical Silver mines in the world.
Just a few weeks ago, we visited the International Property and the site where drilling will soon commence. A significant high-grade discovery was made at the International in the early 1900′s, and the only reason the property has never been drilled to this point is because of access issues which are no longer a problem. Five years of preparation has gone into a drill program for the International (4 by a privately-held company, and 1 by Rainbow which acquired that company in the fall of last year).
There’s a reason Rainbow has significantly outperformed the CDNX this year, and why it has doubled in price since this time in 2011 – investors love the leverage this company offers to a potential discovery, not just at the International but elsewhere in the West Kootenays and Nevada where it holds other Gold and Silver assets.
Rainbow closed Monday, July 23, at 17.5 cents for a market cap of only $6 million. Check out John’s updated chart for Rainbow in Tuesday’s Morning Musings. His Fibonacci targets for GoldQuest Mining (GQC, TSX-V) have been bang-on. And his Fibonacci levels for Rainbow can help guide you to profits as well. Drilling is just around the corner with the exploration target being a high-grade, near-surface deposit.
Before a major discovery in the Dominican Republic, we were telling our readers about the opportunity in GoldQuest under a dime. And again when it moved higher on a great drill result. The move from a nickel to $1.28 in two months has made many investors, including some of our readers, a fortune.
Note: Always perform your own due diligence and read our disclaimer below. Our coverage is for informational and entertainment purposes only and must not be viewed or interpreted as “buy”, “sell” or “hold” recommendations. The writer holds a share position in Rainbow Resources and GoldQuest Mining.