Silver Maintains Strength as it Pushes Against a Resistance Zone

Silver Forecast Video for 04.04.23 by Bruce Powers

Silver has been able to maintain its rally off the most recent swing low of 19.76 for 17 days. Currently, it is pushing up against a resistance zone at the confluence of a downtrend line, the 88.6% Fibonacci retracement level, and resistance of a prior swing high. The top of the prior swing high is at 24.62, while Monday’s high is at 24.18.

Silver Trades in Resistance Zone that Could Lead to Retracement Before Moving Higher

Upward momentum remains strong, yet silver dipped briefly into overbought territory on the 14-Day RSI momentum oscillator on Friday, before turning back down today. It seems like this may be a good area for silver to have at least a minor pullback before continuing higher. Bullish momentum has stayed strong since the current rally began off the March 9 low with little retracement since then.

Even if price does break out above the downtrend trend line and higher than the prior swing high, it is unknown whether silver can maintain its upward momentum and continue to trend higher before a more significant period of retracement and/or consolidation.

Measured Move Completes Near Current Highs

In addition to the resistance zone noted above, there is a relationship between the current rally and the initial advance near the low of the October trend lows. The advance from the 18.07 low from mid-October to the November 15 swing high of 22.24 was 23.03%, while the current rally has seen silver advance 22.4%. Silver will show perfect symmetry with that earlier rally, on a percentage basis, if it hits a high of 24.31. Nevertheless, even with today’s high we can say a measured move has been matched as they don’t need to be perfect. So far, the relationship is close enough.

Upside Targets if Rally Continues

IF the rally does continue higher before a correction, the first target is around the 127% extension of the most recent downswing at 25.94, followed by the completion of an ABCD pattern at 26.85 and a prior swing high at 26.93.

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