Technical analysis of the silver markets
Silver recovered during Friday’s trading to hit the $24 level. This makes the market look like it will continue to be very resilient, but as of this writing I think the market will likely continue to see this more or less as an area of consolidation and everything else. We are in a market that has been relentlessly bullish and it is probably worth noting that the futures markets failed to fill the gap below near $22. In other words, I anticipate a pullback sooner or later and am more than willing to take advantage of it. Honestly, the pullback we had on Thursday was interesting, but I thought we needed to go further.
That may have been interrupted by the fact that wages in the United States appear to be calming down somewhat, so all the macro-tourists, hats to Keith McCullough, are throwing money into the market as fast as they can. The US dollar was hit and of course silver rose. However, liquidity and volume come into play, so I think we’re going to get a bit of a deeper correction. During the day on Friday it was a nice trade, but whether it’s sustainable or not is another question entirely.
I believe breaking the $25 mark will take a lot of effort, so I don’t expect it to happen in the short term. However, should it come to that, it would be extraordinarily bullish. On the other hand, if we drop below $23 I would try to fill that gap below and then maybe be a buyer.
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