Silver Price Outlook – Silver Recovers After Initial Plunge

Silver Technical Analysis

The silver market plunged pretty significantly during the early hours here on Thursday, only to turn around and show signs of life. The market is likely to continue to see a lot of noise, after all silver is typically noisy anyway, and of course, we have four central bank meetings this week. And that, of course, will cause a bit of chaos. Keep in mind that we had recently broken out a bullish flag. And now we’re testing the top of that flag again and finding support not only on Thursday, but also on Wednesday. So, this is a good sign. It doesn’t mean silver has to go higher, but it certainly shows that the market is leaning in that direction.

And why not? It shouldn’t be a surprise. Quite frankly, we’ve been in a very strong uptrend for some time. And based upon the measured move of the bullish flag, it’s very possible that we could go looking at the $36 level. Short-term pullbacks offer buying opportunity, but if we were to break down below the bottom of the flag, then we could go looking at the $40 level, where we would see previous resistance.

Not only previous resistance is found there, but we also have the 50 day EMA reaching toward that area right now. So, while things being equal, this is a market that has a hard floor at the $40 level, assuming that we even get there. As things look right now, I don’t think we do, and I do think that the buyers are coming back to pick up a market that has obviously been very bullish.

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