Silver Price Outlook – Silver Continues to Look Threatened

Silver Technical Analysis

Silver has fallen pretty significantly during the early hours here on Tuesday to reach the 50-day EMA. Since then, we have turned around the show signs of life and bounced a bit, with the $47 level being an area of interest, right along with the 50-day EMA. All things being equal, I think this is a scenario where traders are looking to try to sort out whether or not we are going to see support or we are going to fall apart.

Any bounce at this point in time opens up the possibility of a move to $49. The $49 level being broken to the upside could open up the possibility of a move to the $52 level. If we break down below the 50-day EMA, I think at that point in time, silver really starts to fall apart and $42 becomes a reality right along with $40. Keep in mind that silver is a market that has seen a lot of inflows, and this, of course, is somewhat of a major problem due to the fact that it has gotten too high.

The question now will be whether or not the buyers are really willing to come in and defend things, or if this is just a short-term bounce. I have been hearing people out and about on the street talking about silver and that’s normally a bad sign due to the fact that once the normies start to fly into the bullion dealerships, you’ve generally seen the top. We’ll see if that’s true or not, but I think rallies at this point in time are going to face significant resistance.

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