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Vladimir Zernov
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Silver

Silver Video 19.06.20.

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Silver Gets A Boost From Gold Price Upside And General Market Optimism

Silver continues its attempts to gain upside momentum and settle above $17.50 as the U.S. dollar loses some ground against a broad basket of currencies while the equity market continues to rally.

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The U.S. Dollar Index failed to get above the resistance at 97.5 and pulled back but stayed above the 97 level. A weaker U.S. dollar is bullish for silver as it makes it cheaper for buyers who have other currencies.

Gold is gaining some ground but stays below the key $1750 level. Importantly, gold managed to close above the 20 EMA for a number of trading sessions, and it looks like it has decent chances to test the $1750 level in the near term.

A successful test of this level will boost the whole precious metal segment so silver traders should watch this gold level closely.

Gold/silver ratio did not get above 100 and stays below the 20 EMA at $99.20, increasing the potential for additional downside. Before the coronavirus crisis hit the world economy, gold/silver ratio was below 90, and a return to such levels will be very bullish for silver.

Technical Analysis

Silver is once again trying to settle above the resistance level at $17.50. In my opinion, silver has good chances to get higher as it spent some time near $17.50 without a pullback while the support at the 20 EMA has risen to $17.40.

If silver finally manages to settle above the resistance at $17.50, it will gain upside momentum and head towards the next resistance level at the recent highs below $18.50.

From a bigger picture point of view, an upside move from a solid base could create sufficient momentum to get to the test of the major resistance level at $19.00.

On the support side, silver will have to get below the 20 EMA at $17.40 to develop downside momentum. In this case, silver will head to test the major support level at $17.00. This level has already been tested many times so silver could count on strong support near $17.00.

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

 

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