Silver Price Daily Forecast – Silver Tries To Find Support Below $12.00
Yesterday, I wrote that upcoming trading sessions will be very volatile for silver as there are no established technical levels after a rapid sell-off. However, it looks like silver has finally found its first support below $12.00 per ounce.
While silver (together with gold) should theoretically benefit from the ongoing turmoil in the world markets, the thirst for cash is so strong that investors continue to sell silver. As the world markets are having another challenging day, it’s hard to imagine that the pressure on silver will evaporate in the near term.
In my opinion, silver traders should monitor gold closely as gold will likely serve as a leading indicator for silver. At first signs of stabilization of the situation, investors and traders will likely rush to gold which has suffered due to coronavirus crisis . After this, the market’s attention will turn to the heavily discounted silver.
I’d also note that the major strength in the U.S. dollar is another obstacle for silver upside – U.S. Dollar Index has just passed the important 100 level – so the jU.S. dollar must also be monitored closely.
In recent days, silver made two attempts to get below $12.00. During the first attempt, silver reached the low of $11.80 per ounce, while the second attempt met buyers’ support close to $11.70 per ounce. At this point, it looks like it will be crucial to hold the $11.70 – $12.00 range for silver to have a chance for the near-term rebound.
At the same time, I’d note that silver remains very oversold with RSI at levels below 15. There are two possible ways out of this situation. The first scenario is that the current sell-off may pause, and silver will continue to trade in the $11.70 – $13.30 range so that the oversold condition eases.
The second option is a significant rebound, which will be likely preceeded by a corresponding move in gold which continues to serve as one of the primary safe haven assets for investors in current times, although it is not in such demand as the U.S. dollar and the U.S. Treasuries, which have turned into ultimate safe haven assets during the ongoing coronavirus crisis.