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Silver Bulls Powerful; May be Much More Upside Price Potential; closes near $29/oz

02 December 2010, 9:36 a.m.
By Jim Wyckoff

The March Comex silver futures contract this week hit a fresh three-week high of $28.88 an ounce. The silver bulls have gained good upside near-term technical momentum recently and prices are now within striking distance of strong technical resistance at the November high of $29.405, which is also a 30-year high.

A close above the November high in March silver would find the bulls nearly immediately challenging major psychological resistance at $30.00 an ounce. There is a longer-term technical resistance zone located in a price gap on the monthly Comex silver chart between $29.00 and $30.00. A push above that would also be longer-term technically bullish.

Importantly, there are no early technical clues to suggest a near-term market top is close at hand for the silver market. That means the path of least resistance for silver prices remains sideways to higher.