Silver Price Daily Forecast – Retail Traders Push Silver Towards The $30 Level

Silver Video 01.02.21.

Silver Moves Higher Amid Huge Demand From Retail Traders

Silver is testing the $30 level as retail traders switched from short squeeze stocks to  silver-related assets. The U.S. dollar gained ground against a broad basket of currencies but this move had no impact on silver and gold price today as market participants were focused on the speculative activity of retail traders.

Meanwhile, gold failed to gain upside momentum and is still trying to settle above the nearest resistance level which is located at the 50 EMA at $1865. If gold manages to settle above this level, it will move towards the $1900 level which will provide additional support to silver.

Gold/silver ratio has continued its downside move. Currently, gold/silver ratio is trying to settle below the 63 level. Just a few trading sessions ago, gold/silver ratio was located at the 73 level. Gold/silver ratio has previously visited current levels back in 2014, and it remains to be seen whether silver will be able to move higher without a corresponding move in the gold market.

At this point, silver traders should be prepared for very fast moves as current rally is based on speculative activity of retail traders rather and does not reflect any fundamental developments in the precious metals market.

Technical Analysis

Silver is currently trying to settle above the $30 level. Silver has not visited this territory for many years, and it remains to be seen whether previous levels will be relevant for today’s trading.

RSI has already reached the overbought territory but has not entered into the extremely overbought territory. Back in July 2020, RSI was at much higher levels so silver may have more room to run in case it continues to get strong support from retail traders.

On the support side, silver will likely get strong support near $27.75 but it remains to be seen whether it will get enough interest at higher levels in case it starts to pull back.

For a look at all of today’s economic events, check out our economic calendar.