Silver Price Analysis – Silver Drops with Higher Rates Causing Pain

Silver Technical Analysis

The silver market found its way back down to the very familiar $70 level again on Thursday as we continued to see a lot of noise in the markets. Interest rates in America did jump, and that, of course, has a major negative influence on silver and non-yielding assets in general.

With this being the case, it’s not a huge surprise that we are back down here again and there are a lot of rattled nerves out there due to the war and the possibility of inflation picking up, keeping the Federal Reserve tighter for longer. Ultimately, I don’t think this has changed much. We are just starting to see very volatile but consolidating price action in general.

Market Volatility and Position Management

I am looking for this market to bounce a bit from here, but we’ll have to wait and see whether or not it has any follow-through. I’d be very careful with the silver market right now. It is far too dangerous to get overly aggressive here and I do believe that traders will continue to react very suddenly and very viciously in this market and therefore you have to cut your position size down for the sake of your trading account.

Anybody taking a huge position in silver right now is basically asking for their account to be blown apart. Silver is underperforming gold in general, which is not a huge surprise. That’s how it typically works. The last few months until the meltdown were very atypical. It looks like we’re starting to head back into a more normalized relation between the two.

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