Silver Price Outlook – Silver Rallies Early on Monday

Silver Technical Analysis

Silver has rallied a bit during the trading session here on Monday, but is starting to back some of the gains, and what I would say is somewhat lackluster performance. Silver has been extraordinarily bullish as I’m sure you all know, but the reality is that this is the third attempt to get to the $50 level going back to the early 80s, late 70s, somewhere in that timeframe. And each time we get close to $50, silver collapses. So I do think there is a certain amount of fear in this area for those who have been holding silver this long.

All things being equal, though, you can’t short this market, at least not yet. And I do think there is a significant amount of support at $46 as well as $45. If we can break down below there, then I think the snowball effect starts. To the upside, obviously, the $50 level is an area people will be watching because it’s a large, round, psychologically significant figure. And of course, a lot of headlines will be made if we can cross that level.

I do think, at the very least, though, it makes a lot of sense that we end up going sideways for a while just to work off some of the excess froth that has been part of this market as it has been so insanely strong. With that being said, I like the idea of perhaps buying short-term dips, but if we break below the $45 level at that point in time, I would be very cautious, just in case it ends up being the same way it’s been every time we got close to $50.

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