Silver Price Outlook – Silver Continues to Threaten Higher Moves

Silver Technical Analysis

Silver has rallied again in the early hours of Thursday, but keep in mind this is a holiday-shortened futures market so I wouldn’t read too much into it other than we didn’t sell off. And that, of course, is somewhat impressive in and of itself.

We are now testing the $54 level for the third time with even less volume. This is a market that I think is going to be very easy to get hurt in if you are not careful, because, quite frankly, a lack of volume is going to be a potential red flag. That being said, I don’t necessarily think shorting silver is going to be easy at this point in time. It’s far too strong.

Key Levels and Risks

Pullbacks should see support at the $51.50 level and then again at the $50 level. If we do break higher and above the $54 level, then we’re just going to start our next leg higher, where we end up. It’s pretty much anybody’s guess, truth be known. It’s not exactly like we have been here before based on the measured move of the consolidation. You can make a move to 60 based on the $7 range, I suppose, but really that’s just conjecture at this point.

All things being equal, this is a market that just won’t roll over, but the volume is drifting lower back towards normality. That’s not bad. If the volume really starts to dry up from here, that would be a potentially huge red flag. So, with that being said, also keep in mind that the Thursday candlestick probably doesn’t mean much, and the Friday candlestick will feature most Americans not being around. That’s something to be aware of as well. Once we get back to work on Monday, we’ll see its true colors, but there’s really nothing on this chart that suggests that we’re falling apart anytime soon.

For a look at all of today’s economic events, check out our economic calendar.