Silver Price Analysis – Silver Tests $70 Resistance as Dollar Drops on Buyback Buzz

Silver

The silver market is doing what it can to break above the $70 level. And the $70 level, of course, is a large, round, psychologically significant figure that previously had been support. There’ll be a lot of noise here, and it’ll be interesting to see whether or not we can break above there. So far, we are starting to struggle to get above there. The market breaking above the $71 level could signify that we are clearing that barrier, but as we head into the weekend, there will be some questions to be asked about whether or not it’s a smart hold into the weekend.

Bond Buybacks and Market Catalysts

Volume will probably start to drop off late in the day, and interest rates will have their part to play. Interest rates are still high, despite the fact that silver has rallied over the last several days, but they are starting to turn lower, so we’ll see if that plays out over the next day or two.

This is also a reaction to the US dollar being sold off, as the US Treasury is going to do double the bond buyback purchases next month. And that has people thinking quantitative easing. So far, they’re not willing to admit that, so we’ll have to see how that plays out in the future, but the possibility of the market “jumping the gun” is real.

Of course, silver is not necessarily a safety asset, so it’s not going to have all of the same variables as gold. But gold has broken above a major resistance barrier, so we’ll see if that translates over here in the silver market.