Silver Markets Technical Analysis
The silver market has rallied to test the $24.50 level, an area that I think will continue to be a lot of resistance. It’s interesting that we penetrated that level and then turned around to show signs of life. All things being equal, this is a market that I do think probably eventually breaks out, and you’re looking at the short-term pullbacks as a buying opportunity. If we can break above the $24.50 level on a daily close, then I think it opens up the possibility of a move to the $26 level. Underneath, I see the $23.50 level as a major support level.
All things being equal, it’s also worth noting that the 50-day EMA is getting ready to cross above the 200-day EMA in what is known as the Golden Cross, and some longer-term traders may pay attention to it. For what it is worth, gold is rallying quite drastically, and that of course will have a little bit of a knock-on effect on thesilver market That being said, silver is also an industrial metal, so it does behave a little bit differently.
I think you still have a buy on the dip mentality, but you don’t want to jump into thesilver marketwith a huge position, because quite frankly, it is a market that is extraordinarily volatile and can be very dangerous at times. If we break higher, then the $26 level is the major ceiling that silver will be testing. Pay attention to interest rates because it does have a bit of a negative correlation, and of course, the US dollar has a negative correlation most of the time as well. So I do like silver, I just think it’s a little stretched at this point. That being said, you can find value along the way and that’s exactly what you are going to have to do. I have no interest whatsoever in shorting silver, because quite frankly, it has been so explosive to the upside. That being said, gold seems to be the cleaner play at the moment.
For a look at all of today’s economic events, check out our economic calendar.
This article was originally posted on FX Empire
More From FXEMPIRE:
- NASDAQ Index, SP500, Dow Jones Forecasts – Tech Sector Signaling Top after Volatile Week
- Natural Gas Weekly Price Forecast – Natural Gas Continues to Grind
- Nasdaq 100, Dow Jones, S&P 500 News: US Employment Data Triggers Stock Market Surge
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
