# Silver Roller- Coaster Coming To An End

It is now official: Tuesday’s session determined that the winner of the precious metals mini rally is silver. This by no means implies that the race is over, but now silver has cracked long-term resistance levels and the only way to go is up.

Technical analysis indicates that the long-term resistance mark at $20 an ounce was the only danger that kept silver prices in their teens. Now that silver is moving near$21/oz. it has no resistance and a strong support level. Of course we all hope that from now on we will see a gradual course, so that the market can absorb new prices, and give more opportunities for investors to come aboard. Besides, silver has been on a non-stop climb from its \$18.73 low in late May, so there are bound to be a few short term traders that would want to secure their profits at these levels.

As you can see in the technical chart, silver is already trading above its long-term resistance trend line (red line). It’s also interesting to note that silver outperformed gold on a percentage basis every day since Thursday. The GSR is well below 63.

For weeks now silver was poised for a big upward move thanks to an important technical situation mixed with newly released inflation and unemployment data. Adding fuel to the fire were dovish remarks from Janet Yellen. In Thursday’s press conference, the Federal Reserve Chairwoman said “..unemployment remains elevated and underutilization in the labor market remains significant.”

The Fed is still concerned about the limp in the job market. While the unemployment rate has come down to 6.3%, it’s still higher than the Fed would like. As a result, monetary policy will attempt to expand the overall money supply to boost the economy when growth is slowing. This is done to encourage more spending from consumers and businesses by making money less expensive to borrow, with low interest rates for the foreseeable future.

Silver prices boosted by the Iraqi issue

The deeply complicated nature of the situation in Iraq and Syria advocates for a more hands off approach to American foreign policy in the Middle East. According to the New York Times, the Sunni militant extremists who have seized a broad area of Iraq, extended their control on Monday to the country’s entire western frontier, having secured nearly all official border crossings with Syria and the only one with Jordan, giving them the semblance of the new independent state that they say they intend to create in the region.

With the seizure of the Jordan crossing, which militants from the Islamic State in Iraq and Syria first assaulted late Sunday night, the Iraqi military defenses crumpled, as they have in other battlegrounds in the western and northern parts of the country over the past two weeks. ISIS took control of the Jordan border raised the risks that its insurgency could menace not just Syria and Iraq, but Jordan and Saudi Arabia, two important American allies.

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