- Silver markets look horrible again on Friday, losing roughly 7% before trying to stabilize.
- We are below the $30 level, and it now looks like the silver market has just entered what could be thought of as a negative trend, but we also have to be cautious.
- The main reality in the markets right now are what’s going on with the tariff wars, and the forced liquidation of highly levered positions.
- Silver is very volatile under the best of circumstances, and right now it’s an absolutely horrible time to be in the markets for most traders.
Technical Analysis
The technical analysis for Silver has been completely flipped on its head in just 2 trading sessions. We are well below the 200 Day EMA, and that of course is a very negative turn of events. It looks like the silver market will try to get down to the $28.75 level before it is all said and done, but the biggest problem of course is that if you headlines crossing the newswire suggesting that tariffs were going to be relaxed, could send this market straight back up in the air. This is the type of deep down that you don’t see very often, and it’s something that you need to be very cautious with. I can assure you that somewhere, some huge account has exploded and that has caused more of the forced liquidation.
On the downside, if we break down below the $28.75 level, then I think silver enters yet another free fall. On the other hand, if we were to break to the upside and recapture the $31 level, then I think you have a shot at silver reentering an uptrend, but I also think it will be more of a slow grind to the upside, not necessarily something that’s going to be a major “V bottom” forming. The damage done is something that you need to keep in the back of your mind, so even if things do flip to the upside, there will be a lot of caution out there in the silver market
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