Silver Price Outlook – Silver Continues to See Wild Swings

Silver Technical Analysis

Silver has been negative yet again during the trading session here on Wednesday. I’m hoping that we form some type of range. Nonetheless, I will tell you this: my prediction is that this ends up in tears. I also predict that silver will end up forming a higher floor than it did a few years ago. I don’t expect silver to drop back down to the $20 level very easily or even the $18 level just a few years ago.

However, it is unsustainable at these levels, and you’re starting to see the wobble. The question is, do we go sideways for a long time and try to calm the market down? That’s the bullish case because if we go parabolic from here again, that is a bad sign. That will wreck a lot of other markets because there will be a risk of contagion.

Managing Volatility

Now, having said that, I don’t necessarily think that you should be shorting this market either. I just recognize that we are starting to see wild swings, and typically, markets that are this volatile end up favoring the downside because eventually nobody wants to play the game anymore. This is a market that has been a massive shot higher in a very short amount of time, and as a result, we probably need to give back some.

I think we’re in the process of trying to make that happen, but I find it interesting that on New Year’s Eve, the markets before the pits even opened up in America were down about 8.5% or something. So that tells you that people are trying to get out of this trade and try to get clean sheets heading into next year because this type of price action is nerve-wracking to say the least. If you find yourself in the silver market, there’s literally nothing wrong with taking some profit. And it is prudent to have a smaller-than-usual position. You should position your trade according to the volatility you’re facing. Back in July, it would have been a totally different game, but now we have these wild swings.

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