Silver Price Daily Forecast – Silver Breaks Above $18.00

Silver Video 01.07.20

The Next Resistance Below $18.50 In Sight

Silver managed to get above $18.00 and developed significant upside momentum. Currently, silver is testing the next resistance below $18.50 as the U.S. dollar is flat against a broad basket of currencies while gold is trying to get closer to the $1800 level.

The U.S. Dollar Index has failed to settle above the key resistance at 97.5. A move above this level will likely lead to increased upside momentum for the U.S. dollar which would be bearish for silver as stronger dollar makes it more expensive for buyers who have other currencies.

Recently, the U.S. dollar has been range-bound, which allowed silver to make a successful breakout of the $18.00 level.

Gold continues its upside move, supported by virus fears and huge monetary stimulus from the world central banks. The gold price upside is bullish for silver, especially given the fact that gold/silver ratio has managed to settle below the 20 EMA at 99 and continues to trend down.

Before the crisis, gold/silver ratio was below 90, and a potential return to pre-crisis levels is an important part of the bullish thesis for silver.

At this point, the setup for silver remains bullish as gold continues to rise while gold/silver ratio stays below 100 and shows signs of weakness.

Technical Analysis

Silver gained upside momentum above $18.00 and tested the next resistance level below $18.50. On its first attempt, silver did not manage to settle above $18.50, but it will continue such attempts in case it manages to stay above $18.00.

In case silver gets above $18.50, it will head towards the test of the major resistance level at $19.00. This year, silver made two attempts to get above $19.00 but both attempts were unsuccessful. Silver faced very significant resistance and quickly returned back below $18.00.

This time, silver should have better chances to get above $19.00 as the fundamental situation is favorable and silver looks ready to develop more momentum after a period of consolidation.

On the support side, a move below $18.00 will put silver back into the trading range between the major support at $17.50 and $18.00.

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