Silver markets fell hard again during the trading session on Wednesday, breaking to a fresh, new low before turning back around. At this point, the market is likely to see more grinding which is a bullish sign and if it does in fact happen.
Silver markets broke down a bit during the trading session on Wednesday, slicing below the $12.00 level again. This is an area that is important on longer-term charts, but at this point I am looking to see whether or not it is going to hold. At this point, it does look as silver is trying to find a little bit of a base here, and I think if we can close on a daily chart above the $13.00 level, then it’s likely that the market goes looking towards the $15.00 level. At this point, that is a sign that the oversold condition is about to be corrected. However, keep in mind that silver is highly levered to industrial demand, and right now there are a lot of concerns as to whether or not there will be any.
If we do break down below the lows and close below there on the daily chart, then I will be looking for the market to go down towards the $10.00 level where I will become even more interested in buying this market. At this point, I do believe that the value hunters will be all over it, but I think the “buy-and-hold” traders will also be very interested and $10.00 when it comes to silver. I think at this point it’s likely that the market will eventually find enough momentum to break to the higher levels, but it could be more of a process and quite frankly the more time we take to build up enough momentum to the upside, the better it will be because a lot of people will be convinced to join.
Being FXEmpire’s analyst since the early days of the website, Chris has over 20 years of experience across various markets and assets – currencies, indices, and commodities. He is a proprietary trader as well trading institutional accounts.