Silver markets rallied significantly during the week, closing towards the top of the candle in a sign of strength. If we can break above the top of the candle, we should continue to go to the $17.50 level. This is a market that should continue to be noisy, but the $17.50 level above is massive resistance. I think we will have a significant fight up there but given enough time I believe that silver will continue to climb, perhaps due to a falling US dollar longer-term, or perhaps even some type of geopolitical event. I believe that the $20 level above is a major level, and once we break above there we are looking at a longer-term “buy-and-hold” investment that could rocket towards the $50 level above.
I think that the $16 level is the beginning of major support extending down to the $15.50 level, and I find it very difficult to think that this market will break down below there in continue to go much lower. In the short term, I think that we continue to be range bound between the marked levels on the chart, but certainly it looks as if there is plenty of buying pressure underneath and perhaps a nice opportunity to invest in precious metals slowly, building up a larger position that you can take advantage of. If we were to break down below the $15 level, that could be catastrophic for this market, and send it down to the $12 level, although I think that is only about a 5% possibility.