Silver Price Analysis – Silver Breaks a Massive Barrier, Again

Silver Technical Analysis

Silver continues to defy gravity and has now broken above $110 during the early Monday hours as we continue to see a lot of FOMO in this market. I recognize that this is a market that is obviously bullish, but you are going to have to be very careful in this behavior. This is the type of market that chasing can be deadly for your account.

Market Outlook and Risks

When you get a pullback, you have to assume it is a buying opportunity, although we are now in the realm of a $20 drop means nothing. Unfortunately, silver is a highly leveraged bet, so a $20 drop probably wipes out most accounts in the retail sector. So, I do warn you about that, but having said that, silver clearly is not something you can be shorting.

Quite frankly, I think silver probably ends up really finding, before this is all said and done, its new floor. We don’t know where that new floor is. I would not be surprised at all if we do see a silver crash that we never go under $50 again. The last time we crashed it was something like $12 that held the floor. It might even be higher than that. Either way, this is a one-way trade. If it falls, you are probably looking at silver as a potential buying opportunity, but when the music stops, this one is going to be interesting. I think someday, we will look back at this action and be amazed that people were chasing it after 40% moves in a handful of sessions.

If you’d like to know more about what drives gold and silver prices, please visit our educational area.