Silver Should See Some Resistance with Bearish Divergence

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Silver Technical Update

March 21, 2011 - Silver Should See Some Resistance with Bearish Divergence

Simple Moving Average( SMA ) 200-period (bold, gray)
RSI-14 with Simple Moving Average 5-period of RSI attached.
Fibonacci Study
Elliott Wave Principles
Market and Price Action (patterns, candlesticks)
Intraday pivots and Intermediate-term support and resistance
Multiple Time-frame Analysis

At Critical 61.8% Retracement (3/19)

Silver (XAG/USD)
Silver 3/21/2011 1H Chart

Short to Medium Term
- Silver did not stop at the 61.8% retracement level, and instead shot above end-of-week consolidation near 35.00 .
- Now we are nearing a previous top at 36.46 . However, we are seeing a bearish divergence developing in the 1H chart with an intra-day high of 36.13 .
- If the market breaks below intraday pivot at 35.60 , we would see a top and can anticipate a correction.
- The correction should not break below the pivot made 3/16 35.00 . This should now become support.
-The 4H chart shows the pair at an important declining channel resistance. This is also 161.8% projection of a previous rally swing.
- Thus we can expect some topping here. If this decline breaks below 35.00 , we can see the market declining back towards the 33.55 low.
- However, as noted earlier, if it remains above 35, and rallies back above the current  high, we have an impulse wave development, and the bullish scenario should be re-opened, especially this moves above 36.70 .

Silver 3/21/2011 4H Chart


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Fan Yang CMT
Chief Technical Strategist
FXTimes

 



The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of The NASDAQ OMX Group, Inc.



This article appears in: Investing , Commodities

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