SLV

Silver Price Forecast – Silver Continues to See Momentum Stall

FXEmpire.com -

Silver Markets Technical Analysis

Silver has been back and forth during the early hours on Tuesday, forming a rather neutral candlestick with long legs yet again. At this point in time, I do think silver is due for a pullback, and the reality is that we will probably have a significant pullback sooner or later.

And it might actually be sooner at this point on the Relative Strength index. It looks like we are starting to roll over again, but we are very well ahead of the 70 level, which of course signifies overbought. So, at this point in time, I think we have one of two choices. We either go sideways for a while and work off some of the from, or we get a vicious pullback that shakes out a lot of the hot money.

The retail trader out there is over levered and silver will get smoked sooner or later. I’ve seen this happen a couple of times, especially in this market. So, the one thing that you need to do is make sure that if you get something like a $2 drop, it won’t wipe out your account. Because $2 seems like a lot.

The reality is we had about $1.70 worth of change from top to bottom. Just the previous session. What happens if we wipe out the $31 level? Well, at that point, I think we drop another dollar pretty quickly and we could even drop down to the $28.50 level, which would not change the overall trend at all. So recognize that you are extremely extended at this point, and although we could go higher from here, the more likely route is either sideways or down, at least in the very short term.

Longer term, we could go as high as $50 because it does seem like every time the market breaks above $30, it does try to make it to $50 and then it gets smashed, including the last time it did it, it went from $50 or just under $50, falling all the way back down to $12. So be careful. Silver is a dangerous animal.

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:

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

Tags

More Related Articles

Info icon

This data feed is not available at this time.

Sign up for the TradeTalks newsletter to receive your weekly dose of trading news, trends and education. Delivered Wednesdays.