Silver Price Analysis – Silver Tests $60 Resistance as Death Cross Looms

Silver Technical Analysis

The silver market has been very bullish during the trading session on Tuesday to test the $60 region again. This is an area that is a large round, psychologically significant figure and is good for headlines. We’ll see whether or not we can break above there, but just the last couple of days we’ve seen the so-called death cross when the 50-day EMA crosses below the 200-day EMA, which is a very negative technical signal for longer-term traders.

High Rates and Death Cross Weigh on Silver

That being said, the real problem here isn’t so much a couple of moving averages; it’s the fact that we have been selling off and interest rates continue to be stubbornly high in the United States. That typically will put pressure on non-yielding assets such as gold and silver. A stronger US dollar does not help the situation either.

So, all things being equal, while this is a nice bounce, it really hasn’t fundamentally changed much as far as technical analysis is concerned. We’re just seeing more of the same behavior. There are, more likely than not, going to be a lot of sellers just above waiting to get involved, so at the first signs of exhaustion, there will be people very concerned about holding onto silver, would be my estimate.

To the downside, the $50 level has been both support and resistance in the past, mainly resistance though. It has been the top of the market multiple times until recently, going all the way back to the 1970s and the Hunt brothers trying to corner the market. Because of that, I would anticipate a lot of noise in that area if we do start to fall apart.

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