Silver Price Forecast – Silver Markets Collapsing

Silver markets have broken down significantly during the course of the session on Wednesday to break down below the $22.50 level, which means that we are now threatening a major low. If we break down below there, then it is likely that we would go looking towards the $21 level, followed by the $20 level. This is essentially the “trapdoor” to much lower pricing. That being said, the market is likely to see an acceleration of downward pressure, especially if the Federal Reserve does tighten monetary policy quicker than anticipated. If that is going to be the case, then the US dollar will spike, driving down the value of silver.

SILVER Video 16.12.21

To the upside, we need to recapture the $22 level before we can even remotely consider looking at this as a potential buying opportunity. If we do recapture that level though, it is possible that we could be putting in a cyclical low. Unfortunately, this comes down to what the Federal Reserve says at the end of the Wednesday session, suggesting that the tapering is going to be the biggest driver. Ultimately, the market is trying to front run what the Federal Reserve will do, so there is the potential for a “rip your face off rally” if they do in fact back down from the bullish stance. I do not know that is the case or that it even likely, but at this point in time it looks as if you need to be cautious regardless, due to the fact that this market is choppy under normal circumstances, but when you have central bank actors talking, it gives absolutely volatile. At this point, I would step aside and let the market tell you what is going to do.

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