Silver Markets Pullback Towards Support

Silver markets have fallen a bit during the trading session on Wednesday to reach down to the $25 level, an area that has been important more than once. Because of this, it does make a certain amount of sense that we did get a bit of a bounce, but the $25 level course would be an area that a lot of people pay attention to from a psychological standpoint, beyond the technical influence.

SILVER Video 03.03.22

If we were to break down below the $25 level, then the market is likely to go much further to the downside. The attitude of silver is being highly influenced by the US dollar and risk appetite, throwing the market back and forth in extreme volatility. That being said, the silver market does look as if the $25.50 level is crucial, meaning that if we can get above there that the silver market could go much higher.

Keep in mind that the volatility that you see in silver is much stronger than in gold, so you need to keep your position size reasonable. If this is true under the best circumstances, let alone when you have so much in the way of geopolitical concerns. Furthermore, there is a lot of demand for silver as economies reopen, as it is also an industrial metal.

At this point, it seems as if silver is being used to run away from certain fiat currencies, and therefore it makes quite a bit of sense that we continue to see buyers on dips going forward. That being said, you still need to keep your position size reasonably small, as the moves will be violent if and when they occur.

For a look at all of today’s economic events, check out our economic calendar.