- Silver initially fell during trading on Monday, to reach the 50 Day EMA.
- The 50 Day EMA is a significant indicator that a lot of people will pay close attention to, and the fact that we have bounced from there to break back above the $33 level by the end of the session does suggest that there are plenty of people out there willing to get involved.
- I think at this juncture, we have to keep in mind that this is a market that has been very bullish, and it seems like it is willing to fight tooth and nail to determine the ability to go higher.
Technical Analysis
The technical analysis for this market is rather bullish, as we have seen a significant bounce. Furthermore, we have broken well above the 50 Day EMA, only to turn around and find support at that same indicator. Furthermore, the $33 level is a significant large, round, psychologically significant figure, and an area where we had seen a lot of noise previously, due to market memory and the fact that both buyers and sellers seem to be interested in this area.
The candlestick for the trading session looks a lot like a hammer, and it flies in the face of the negative candlestick from Friday. It’s worth noting that the $33.66 region seems to be very difficult, and if we can break above that level, then I think silver has a chance to go higher. We should also pay close attention to the idea of what the US dollar is doing, because the US dollar has a massive negative correlation with silver most of the time.
If we were to break down below the $32 level, then I think silver is probably going to go lower, perhaps testing the overall trend. The 200 Day EMA sits just above the $31 level, and of course the $30 level is an area that I think a lot of people will be paying close attention to. In general, that’s where we could go if we break down, but right now it doesn’t look very likely.
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