Silver Price Analysis – Silver Continues to See Wild Swings

Silver Futures Technical Analysis

The silver market plunged well below the $70 level only to turn around and show signs of strength as we are trying to form some type of hammer. This is a market that I think, over time, will have to find some type of supportive consolidation range. If we break down below the lows of the day, I think that is a very negative sign.

The move below 70 really would have had me bearish, but I recognize that the turnaround on the same day obviously negates that. I am going to be watching the silver market for daily closes to get a read on where we may or may not be going, because you could make an argument for some type of support here based on the entirety of the move as we bounce from the 61.8% Fibonacci retracement level.

Volatility and Market Pressure

Ultimately, I think this is a market that if we continue to see this type of volatility, it will inevitably lead itself to lower pricing just simply because this type of volatility drives up margins, spooks investors, and a whole plethora of other things.

$90 is your ceiling at the moment; $65 or so is your floor. With this type of potential move in either direction, position sizing is crucial. If you are bullish, that is fine, but I recognize that the upside is somewhat limited. At this point, we need to see a few daily candlesticks of just sideways action. We did have that, only to plunge in the end of that mess. So we will see. I still think there is a lot of pressure on this market.

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