Silver Price Outlook – Silver Continues to Grind Back and Forth

Silver Technical Analysis

The silver market has been slightly negative during the early hours on Tuesday, as we are hanging around the $47 level, and then at that point in time bounced a bit to find itself near the $47.50 level. All things being equal, this is a market that I do think is trying to find its footing in this area due to the recent rally, the significant pullback, and now we’re just trying to grind away some of these overly frothy positions that people had gotten into. The question at this point is whether or not we can keep up the bullish behavior.

If we were to break down below the hammer from the Tuesday, October 28th session of last week, that would break the 50% Fibonacci retracement level and the 50-day EMA. I think doing both of those to the downside would be negative and could send silver much lower. The $50 level above, for me, is considered a major resistance barrier. If we can break above there, then we could go looking toward the $54 level.

All things being equal, this is a market that I think, best-case scenario, is going to be sideways. Ultimately, though, I think you’ve got a scenario where you probably need to be focusing on short-term charts, but realize it might be time to pull the ripcord on this trade if we do break down below this 50% Fibonacci retracement level because it could lead to much deeper corrections.

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