Silver Technical Analysis
The silver market rallies a little bit early on Monday to show signs of resiliency again as the market finds itself stuck between the 50-day EMA and the 200-day EMA indicators. The silver market has been rallying for several days now, breaking above a swing high from the beginning of July, showing signs of strength, but there could be a challenge here at the 200-day EMA. There certainly was on Friday as the market peeled away from that level.
Breaking above it could bring in more momentum, with traders perhaps watching the next major area, at least from a psychological standpoint, the $70 level. On a pullback from here, the $60 level has proven itself to be important a couple of times previously. That might be where support comes back into play with traders willing to jump into the market.
Interest Rates and Currency Influences
Regardless, one thing that I’ll be watching is the interest rate market and seeing where rates go. They are kind of steady, and that at least gives some cover for silver to rise because rising rates, historically speaking, have been very negative for silver markets in general.
So, part of that is possibly due to the fact that silver’s non-yielding. It’s also the U.S. dollar strengthening. Silver is priced in U.S. dollars, after all, but it’s not a 100% correlation, so it’s just one of the factors here. As things stand right now, it looks like the buyers have been in control for 4 or 5 days for the most part. They are trying to make their presence known early on Monday.
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