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Dan Norcini continues:


“There were three previous attempts at this level that were held back by the shorts and when this upside resistance level was breached, the shorts had no choice but to run for cover.  To compound their problem you had more fresh money pouring into silver, which simply added stress to the already panicked shorts.


We mentioned over the weekend in the KWN Weekly Metals Wrap that once silver cleared $35.50, there wasn’t a lot of overhead resistance in that market until roughly the $40 area....


Continue reading the Dan Norcini interview below...




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“You have strong resistance in silver showing between the $40 to $41 level.  That’s where silver is going to encounter some selling.  If silver breaks above that resistance level, we should see a move to the $45 area. 


It’s important to note that silver has now broken above its 50 week moving average and that average has capped this market going all the way back to October of last year.  So, as I said this is a very significant breakout, Eric.


This last COT report showed hedge funds net long 28,000 contracts in silver.  The highest level the hedge funds have held is net long 48,000 contracts.  So these hedge funds have an awful lot of contracts they can add if they decide to start piling back into the silver market.  You can certainly make the case that silver is not excessively crowded, even though we’ve had a pretty good run here.”


When asked about gold, Norcini responded, “We are on the verge of a major breakout in the gold market.  We’ve moved back up into the resistance zones that stopped the advance last week.  However, we have now broken through last week’s high.  


If we close above $1,780 in the gold market, it appears gold will quickly move through the $1,800 level.  Once gold clears $1,800 in a strong fashion, we will have seen a major breakout in gold. 


Gold is poised for a test of major resistance at the $1,800 mark.  Again, if gold does what silver just did at $35.50, then you have your major breakout.  The last area of resistance after $1,800 on gold is the $1,850 level and then gold should move to test the all-time highs.”


Norcini also noted:  “The US dollar hit fresh new lows dating back to early December of last year.  There is a bit of support at 78 on the dollar, but if that fails you are going to see a very quick move to the 77 level and I mean right away to 77.  Below 77 on the US dollar there is nothing to hold it up until 75, so traders should keep an eye on that.”


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Eric King

KingWorldNews.com

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