Silver Is Approaching the Mother of All Supports

To be honest, I thought that gold and silver would do a lot better, but here we are today where both are in the group of some of the worst performing commodities over the past several months. And the situation just got even worse.

First the H4 chart, where you can see a very handsome head and shoulders pattern. The neckline (red), was already broken, so the formation is up and running, which means a further drop. Currently, we have a small stop (green rectangle), which is just a very flat correction proving the bearish point.

You can see that the price is approaching the orange horizontal support. What is that line? Silver’s daily chart will definitely help us understand. That is 21,7 USD/oz, so an ultimate long-term stronghold for buyers. This level means ‘to be or not to be’ for the bullish fraction on silver.

The way to trade it is pretty simple despite the gravity of the situation. A proper bounce (with a pattern or candle) would be a legitimate buy signal. On the other hand, a breakout with a nice-looking candlestick, would mean a proper sell signal. For now, all we can do is wait.