Silver Price Outlook – Silver Continues to Grind Higher

Silver Technical Analysis

The silver market has rallied quite nicely during the trading session in the early hours of Thursday as we continue to see a lot of noise. All things being equal, this is a market that I think will probably see a lot of volatility, that’s typical for silver, And the fact that we are well above the $37.50 level is a good sign as it could have us looking towards the crucial $40 level again.

The $40 level, of course, is a large round psychologically significant figure and an area that I think people will stand up and pay attention to once we get there. If we do pull back, I believe that $37.50 level offers support. A breakdown below there then has the 50 day EMA being targeted as support as well. Ultimately, silver does fairly well when the U.S. dollar starts to fall, and we have seen a lot of selling of the U.S. dollar.

Furthermore, gold looks like it’s doing everything it can to try to break out to the upside. And if that were to happen, it probably drags silver right along with it. After all, the two do tend to move in the same direction over the longer term. Ultimately, I would look at pullbacks as nice buying opportunities, but keep in mind that silver is a very volatile and dangerous contract at times. So, make sure that your position size isn’t too strong.

In that environment, you could have a situation where you can take big losses quickly if we do get another massive sell off, for example. Nonetheless, silver is something that I like, and I do believe that the industrial demand is probably only going to pick up longer term. So, I think we will continue to reach that crucial $40 level.

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