Silver Price Outlook – Silver Continues to Work Off Froth

Silver Technical Analysis

Silver has been very choppy and somewhat sideways during the early hours here on Tuesday. Ultimately, this is a market that I think is consolidating. Really at this point, I think you’ve got a situation where if we do pull back from here, the $41 level should be a support level. If we break down below there, then we could be looking at the $40 level as a potential floor, as it had been a significant resistance level, a little bit of market memory, quite frankly, I think makes sense.

That being said, we are at the top of a channel. And if we break the top of that channel, that shows impulsiveness. That probably has people chasing silver. I prefer to see it go sideways for a while or even dip a little bit in order to work off some excess froth. And of course, possibly even offer value in what is a very strong market overall. Ultimately, I do think silver’s going to push towards $45, but we probably have some time before that actually happens.

In fact, it may even be after the Federal Reserve interest rate decision on the 17th. So, we’ll just have to wait and see. We could have a few days of sideways action. Every time silver pushes higher in an impulsive way, it does tend to spend a week or two sideways. And that could be what we see. Either way, the one thing that I won’t do here is short this market.

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