Silver Price Analysis – Silver Continues to See Support at Same Level

Silver Technical Analysis

The silver market has bounced a bit in the early hours here on Wednesday as the $70 area continues to offer a bit of a floor. The 50-day EMA sits above and has acted as resistance over the last couple of days, so I am not expecting a miracle here. What I am expecting is that there still remains plenty of interest just above the $70 level.

I think at the moment we are trying to do everything we can to sort out the next consolidation area. Right now, I would say $70 is on the bottom and $90 is on the top. We should compress over time to have a smaller range; quite frankly, that would be a lot healthier, as we have a lot of damage that has been done to this market just a couple of weeks ago.

Potential Breakdown Below Support

This is the type of breakdown that is impossible to ignore. There are a lot of traders out there who will have probably blown up their accounts because of the leverage involved in the silver market during that session a few Fridays ago.

I am watching this very closely, but I recognize that if we were to break down below the $70 level, that could change things and we could see even further selling pressure, perhaps down to the $60 level, maybe even the 50-day EMA, which is sitting at $56.78.

I do believe this is a market that there is support for eventually and I do believe that there is a bottom underneath. We don’t know if it is $70 or if it is closer to $50. I do know that the bottom in the silver market won’t be $12 like it was the last time we fell apart.

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