Brent Harris Elliott Wave
Futures Market Advisory Service

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Silver (Jan. 31, 2009)

While the wave-progression from the October 2008 low in silver (8.40) remains MODERATELY BULLISH...for now, the longer-term pattern suggests that by March or April 2009, a HIGHLY BEARISH POSITION will probably be at hand. In essence, because we only JUST ENDED A 15-YEAR BULL CYCLE in March of last year (at the 21.38 high), AND we are now only about HALFWAY-THROUGH the INITIAL, CYCLE-WAVE-A section down, it’s highly likely that prices will have to AT LEAST "BLOW-0UT" THE OCTOBER 2008 LOW (-8.40), BEFORE the stage will be set for a longer-term rally. Thus, once it is possible to label a completed Primary wave-[b], OR wave-[x] advance from the 8.40 low, traders should have a WHALE OF A SELLING OPPORTUNITY! To that end, since we now only need a "moderate" , 2-to-3-week pullback, AND THEN ONE MORE SHOT-UP TO NEW RALLY HIGHS, in order to effectively label a completed DOUBLE-THREE formation, I’m guessing that the FINAL TOP WILL OCCUR AROUND EARLY MARCH (2009). As far as key resistance is concerned, while I do have good numbers at BOTH the 12.41-12.60 and 13.36-13.59 areas, THE SINGLE-BEST CLUSTER IS AT 14.50-14.815. This area yields the 23.6%-47.05%-55.9%-retracement combination from the 1980, March 2008 and July 2008 highs, as well as appreciations of 314.58% and 76.4% from the 1993 and 2008 lows. Finally, since the overall decline from the 2008 top could be sub-dividing into EITHER a "single-three", OR a "double-three", the next "leg-down" could unfold into EITHER a good-trending, "five-wave" pattern, OR a more complicated, "three-wave" pattern (the latter of which is illustrated on the silver monthly chart). However, in either case, our MINIMUM DOWNSIDE TARGET WILL ALMOST CERTAINLY BE AT THE 7.49-7.32 LEVEL. This area incorporates the 76.4%-retracement projection from the 1993 low, AND depreciations of 85.4%, 65.45% and 61.8% from the 1980, March 2008 and July 2008 highs. By the way, IF a [double-three] is unfolding overall, AND the [a]-wave section down reaches the 7.49-7.32 level, then the FINAL LOW of CYCLE-WAVE-A could occur at the next lower support cluster, or 6.11-to-5.83?

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