The Devil’s Metal, Looking For A Silver Dead Cat Bounce Yet? (SLV, SIVR, PSLV, ZSL, SLW, PAAS)

We have taken a look at iShares Silver Trust (NYSE: SLV), ETFS Physical Silver Shares (NYSE: SIVR), Sprott Physical Silver Trust ET (NYSE: PSLV), ProShares UltraShort Silver (NYSE: ZSL), Silver Wheaton Corporation (NYSE: SLW), and Pan American Silver Corporation (NASDAQ: PAAS). The drop has become so severe, that it is going to be easy to expect that some traders, speculators, and investors may start looking for a bounce.  It may just be a dead cat bounce, but that is for later.

iShares Silver Trust (NYSE: SLV) and ETFS Physical Silver Shares (NYSE: SIVR) are nearly tracking each other, although we would note that there may be more of a disparity in the asset values versus the market values due to the massive rise that happened last week.  The iShares Silver is down 7.7% at $35.33 and the ETFS Silver is down almost 8% at $35.93.  This has the iShares flavor of silver down 27% from its peak last week of $48.35 and the ETFS flavor of silver is down 27% from the peak of $49.28 last week.  The SLV chart here shows that the latest move could still offer a lot of punishment ahead based solely on the moving averages but there may be support around $33 based upon prior trading.

Sprott Physical Silver Trust ET (NYSE: PSLV) is actually a closed-end fund and it is down 7.7% at $15.70 today and this peaked at $23.00 last week before its premium to the net asset value was highlighted by the media.  Shares went out last Friday at $21.73, making a 27% drop just this week and a drop of more than 31% from the peak.

If you want to see just how zany the silver move has been, there is the ProShares UltraShort Silver (NYSE: ZSL) which aims to be double-short silver.  There is always the chance of tracking errors here and it trades inversely with the price of silver.  The shares are up 14% at $22.22 today versus $13.64 as a closing price last Friday.  Being double-short silver in this vehicle just generated gains of  about 63% in just four trading sessions.

Miners have also been hit but they are actually holding up better than the metal itself.  The stocks didn’t get as much of a boost at the last surge in price, so they are not getting killed as the bubble deflates.  Silver Wheaton Corp. (NYSE: SLW) is down 3% at $36.04 today and has lost almost one-quarter of its value from the peak.  Shares closed at $40.62 last Friday and that is a loss of about 11% so far this week.  Pan American Silver Corp. (NASDAQ: PAAS) is down 1.6% today at $33.96.  Shares are down about 21% from its peak but down only about 6% from last Friday’s closing price of $36.12.

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JON C. OGG