Silver Price Analysis – Silver Continues to Grind

Silver Technical Analysis

The silver market initially did try to rally during the trading session on Thursday, as the $80 level has been an area where a lot of resistance has shown up, but when you look at the longer-term action, it’s essentially fair value. The $70 level underneath is support, the $90 level above is resistance. The $80 level is an area that I think is also going to be interesting due to the 50-day EMA.

The interest rate decisions around the world could continue to keep rates somewhat elevated and that, of course, has an effect on silver as well; higher rates typically mean lower silver. That being said, rates have dropped as of late in the actual bond markets as the Middle East is starting to calm down a bit and that has helped silver, as rates drop in reaction to the good news. Now, we continue this pattern for the time being, from what I can tell.

Focus on Position Sizing

The question is: what’s the next move? I think ultimately a short-term pullback makes a little bit of sense, but that’s probably going to end up being a buying opportunity. I think we will settle somewhere between the $70 and $90 levels for a range, but things will be very bumpy along the way.

The only thing you can truly control in the silver market is going to be your position sizing, so make sure you are not overexposed. I remain bullish, I just recognize that it’s probably going to be more of a grind to the upside, so patience will be needed to navigate it.

If you’d like to know more about how to trade gold and silver, please visit our educational area.