Silver Price Analysis – Silver Stalls at $60 Resistance as Dollar Gains

Silver Technical Analysis

The silver market has dropped a bit during the early part of the trading session on Friday as we continue to see the $60 level offer a bit of resistance. Underneath, we have the $55 level offering support, and ultimately, this is a market that continues to be choppy and noisy.

Silver does that quite often. The interest rates rising the way they have in the last several weeks has put a little bit of pressure on silver, but we have to admit it’s held up okay. It really hasn’t fallen apart. The question now is what’s going to happen in the Middle East because that has a lot to do with what happens with the silver market. If rates start to climb because of the Middle East again, then you have a situation where that could put more pressure on silver.

Interest Rates and Geopolitics Drive Volatility

Longer term, I like silver a lot, very much so, and I do believe that silver will eventually turn things around, but it may have to drop yet again. The $50 level underneath is a large round, psychologically significant figure and an area where we’ve seen a lot of action going back to the Hunt brothers in the late 70s. Side note, I’ve actually had, when he was alive, conversations with Lamar Hunt; very interesting story when they tried to corner the physical silver market.

The $50 level was the peak back then, and then during the financial crisis it was the peak again. We broke through it late last year. Simple technical analysis suggests that maybe we have to retest that area. I don’t know if we will, but it wouldn’t be a huge surprise. If the US dollar continues to strengthen, that puts downward pressure on this market as well. Rallies at this point in time just don’t seem to have momentum.

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