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Christopher Lewis
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Silver

Silver markets initially pulled back a bit during the trading session on Thursday but seem to be finding support near the $23 level. Quite frankly, this is interesting due to the fact that the 38.2% Fibonacci retracement level is in that area, and therefore it will attract a certain amount of attention. Ultimately, this is a market that should continue to see a lot of choppiness overall, and I am still bullish of silver, regardless of the fact that we have seen a lot of negativity. Underneath, I think that the $22 level is support as well, and then the 200 day EMA.

SILVER Video 30.10.20

Ultimately, if we can break above the 50 day EMA, then the market goes looking towards the $26 level. If we can break above there, then the market is likely to go looking towards the $27 level where we have seen a lot of supply in the past. To the downside, even if we break down below here, I think that the absolute “floor” in the market is closer to the $20 level. Ultimately, this is a market that should continue to be bullish over the longer term, as central banks around the world will continue to flood the markets with liquidity. Because of this, I think that this market remains a “buy on the dips” type of situation.

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I have no interest in shorting, because quite frankly with all of the central banks out there looking to flood the markets with currency, it would make quite a bit of sense that the precious metals will get a bit of a bid. However, I am the first to tell you that gold typically acts a little stronger in that scenario.

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

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