Silver Retreats, Everything Needs A Breather
Yesterday, the iShares Silver Trust(NYSE:SLV) traded over 189 million shares. This was the highest volume ever in the SLV, which will usually signal exhaustion buying. Many times before a stock, ETF, or commodity top out or are getting set for a pullback it will surge higher on heavy volume. That was exactly what took place yesterday for silver. This morning the SLV is trading lower by $1.65 to $44.19 a share. Please understand that the SLV was very overbought and extended on the charts. The SLV has climbed higher by more than 80.0 percent since January 25, 2011 when the SLV traded around $26.00 a share.
Anytime a stock or commodity has a move this strong for this length of time, a correction or pullback will eventually occur. Please remember that nothing goes up in a straight line. Other leading silver stocks that are trading lower include Silver Wheaton Corp.(NYSE:SLW), and Pan American Silver Corp.(NASDAQ:PAAS).