The silver market continues to see a bit of an overhead barrier, as we are still below the $60 level, which is an area that a lot of traders will be watching. Ultimately, silver continues to struggle with the US dollar being so strong.
Silver
The silver market initially fell a little bit during the trading session here on Friday, but then turned around to show signs of life. The market is now threatening the $60 level. The $60 level has been a bit of a floor recently, and previously had been significant resistance near the month of December.
Ultimately, this is a market that I think continues to see a lot of volatility, but keep in mind silver is heavily influenced by the fact that the US dollar is strengthening, something that works against silver, and that’s exactly what’s been going on.
Technical Barriers and Key Levels
Ultimately, if we do break above the $60 level, I think there is a bit of a barrier in the form of the 200-day EMA above that offers a ceiling. Signs of exhaustion should be sold into, and I think with that, you get a nice short-term setup every time we bounce. Longer-term I still like silver, but I think silver has a long way to go to escape the influence of the US dollar.
If we break down below the low of both Friday and Wednesday, it opens up a move back down to the $50 level. And the more this goes on, the more I think that ends up being the most likely outcome. Long-term, I like silver again, but in the meantime, I think you fade signs of exhaustion every time this market bounces. Ultimately, silver is a 2-speed market. If you’re short-term, you’re probably bearish; if you’re longer-term, you’re looking to invest, obviously with less leverage.
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Christopher Lewis is a technical analyst and market commentator at DailyForex with more than two decades of trading experience in Forex and other leveraged markets. Based in Columbus, Ohio, he specializes in chart-based analysis of major currency pairs, stock indices, commodities, and energy markets, focusing on clear support and resistance levels, trend structure, and risk management. Christopher produces daily written and video analysis for traders who rely on technical setups to navigate volatile market conditions
As seen on: Pairs Of Aces Podcast,The Trader Guy, FXEmpire
