Silver Technical Analysis
The silver market has bounced slightly after initially falling earlier this week. At this point in time, though, we are paying attention to the same thing, and that, of course, is going to be interest rates. Interest rates continue to rise in the United States. That is not good for silver, and therefore we see this pressure.
The jobs number will be paramount on Friday. Between now and then, it would make a bit of sense to go sideways and chop. I just don’t see a situation where the whole thing changes quickly, and in this environment, it’s likely that we will see a lot of back and forth, a lot of selling of the initial rally that shows signs of exhaustion, just as we will have buyers of dips as well.
Long Term Outlook
So, with all of this being said, I am fairly neutral with silver. We do need to get this jobs report out of the way. Once we do, we might have a little bit more clarity. We’ll have to watch that 10-year yield as well as the 2-year yield. As long as they stay elevated, that does suppress rallies in silver.
Longer term, it is a commodity that is definitely in huge demand. As we had seen about a year and a half ago, that should, in theory at least, help down the road. But until we get through this energy inflation concern, silver will more likely than not be at the mercy of the bond market. This is more likely than not going to be the story for some time now.
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