Silver Price Forecast: Tests Key Support, Potential Bullish Reversal Ahead

Bruce Powers
Published: Jun 17, 2024, 20:47 GMT+00:00

Silver awaits a breakout signal as it consolidates near the 50-Day moving average.

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Silver has been testing support around the 50-Day MA for the past several days as it looks to complete a retracement. The pullback low is 28.66 and that is the key support level to watch for further signs of weakness. A decisive drop below that price level puts silver in a more bearish position given that the uptrend will have been broken by then, as well as the 50-Day MA. Each line represents dynamic support for the near-term uptrend. A quick recovery back above 28.66 may negate the bearish implications. Otherwise, the swing low from 26.02 becomes a lower target.

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Pullback Low Shows Support

Last week’s low of 28.66 looks to have completed five waves down, thereby opening the door to a possible bottom and subsequent bullish reversal. Not only did the retracement low find support around the 50-Day MA and uptrend line, but it was also a successful test of support around the May 2021 swing high at 28.75. In addition, the low found support around the bottom trendline of a falling channel. There are several technical reasons for 28.66 to hold and lead to a bullish reversal. But there are no signs of it happening yet though.

Upside Breakout Above 29.73

An upside breakout above the three-day high of 29.73 will provide a sign of strength. Note that silver is currently on track to end Monday with an inside day. It would follow an inside day on Friday. Therefore, there is the potential for a double inside day breakout to trigger if today ends as an inside day. Nonetheless, the three-day high should provide a more reliable signal given that silver remains in a downtrend retracement.

Weekly Bull Rally Above 30.26

Last week’s high of 30.26 provides a first upside target for a bounce. However, a rally above 30.26 shows further signs of strength that may lead to a continuation higher as it triggers a bullish weekly breakout. Once there is a daily close above 30.26 silver should be in a stronger position to continue to strengthen. Also of concern is the 20-Day MA at 30.40. It was a key trend indicator for support until silver dropped below it twice, on June 3 and then June 7, before staying below it.

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About the Author

Bruce boasts over 20 years in financial markets, holding senior roles such as Head of Trading Strategy at Relentless 13 Capital and Corporate Advisor at Chronos Futures. A CMT® charter holder and MBA in Finance, he's a renowned analyst and media figure, appearing on 150+ TV business shows.

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