Silver Weekly Price Forecast – Silver Continues to Look Dangerous

Silver Markets Weekly Technical Analysis

Silver initially did try to rally during the trading week, but has gotten crushed since then, especially on Friday. Friday wiped out Wednesday and Thursday after we had tried to recover. With the jobs number coming out hotter than anticipated, a lot of people are betting on the idea that the Federal Reserve will keep its monetary policy tighter for longer, thereby making silver less attractive. Why hold silver, which is inherently volatile, when you can hold paper that has interest attached to it? Rates have gone up during the trading session on Friday, especially on the 10-year, so that does make a lot of sense that we would see metals suffer.

The question now is whether or not we see a bigger drop, perhaps down to the $28.50 level, or do we turn around and recover? The $30 level, of course, is an area that will attract a lot of attention, and if we can break above there on a daily close, then longer-term traders will probably start to pile in. Keep in mind, this is a market that continues to be very noisy, and momentum driven more than anything else.

So I do like the idea of buying dips, but right now we just don’t have the setup. If we were to break down below the $28 level, then we could see another $2 drop to reach the $26 level, an area that previously had been important. This is a market that is still very much in an uptrend, despite the fact that we’ve seen a real beating over the last two weeks. The question now will be, will the buyer step in and defend?

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