Candlesticks Highlight Trend Reversal at Typical Retracement Level in Silver

Here is a beautiful example of the power of typical Retracement Levels to stop price advances in their tracks, and then to send them in the other direction.  The Candlestick presentation makes the example exceptionally clear.

We often see retracements in countertrend moves stopping at one of several typical levels – 78.6% of the initial decline being one of them.

Silver had declined in three waves from its December 3, 2009 High to its February 5, 2010 Low.   From that Low, prices advanced again in three waves to their High on April 12, which is just above the .786 retracement of the decline from December 3.  Since then, prices have been rejected downward to their present level below 1775 as this is being written.

The price presentation in Candlestick format greatly assists in revealing this phenomenon in pictorial form.

Please maximize the chart so that the entire story will be right there before your eyes.

William Kurtz
April 19, 2010

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