Silver is about to test the recent positive sentiment

Silver is About to Test the Recent Positive Sentiment

28 days agoByTomasz Wiśniewski

It looks like the worst is behind us. The flash crash from the 7th of July, cleared few stop loss orders for sure and many buyers were kicked out of the market. That kind of price action often happens and do not surprise experienced traders. What is left on the chart now is a false breakout, which according to the price action is a good signal to buy.

To be precise, the false breakout is a V shape reversal and which created a great opportunity for an upswing. The Silver went significantly higher and made four bullish daily candles in the last week. This allowed to quickly reach a first important resistance here (light blue rectangle), which is a combination of various technical elements. First of all we do have a black up trendline, then red down trendline and the green horizontal resistance (around 16,8 $/oz). This the area where the potential upswing can stop or have a pause. Bearish price action there will promote a take profit action (so a decline). On the other hand, breakout will be a trigger for a mid-term buy signal.

Silver Daily Chart
Silver Daily Chart

So now we wait. In the meantime it would be nice to take a look on the Gold chart to look for more hints as both instruments are highly correlated. On Gold, the demand is now fighting with the 1259 $/oz resistance and the bullish breakout should have a positive influence on the Silver too. Keep eye on those two precious metals as being around important S/R levels creates an opportunity for a trade with good risk/reward ratios.

This article is written by Tomasz Wisniewski, a senior analyst at Alpari Research & Analysis

Favorites

SymbolLast PriceChangeChart
EURUSDEUR/USD
1.1760
+0.0005+0.04%
GBPUSDGBP/USD
1.2881
+0.0010+0.08%
XAUUSDGold
1288.5
+5.3500+0.42%
CLCrude Oil
48.775
+0.0750+0.15%
UKXE-Mini FTSE 100
7320.7
+8.7500+0.12%
DAXDAX 30
12128.2
-20.750-0.17%

Live Quotes

Top Promotions
Top Brokers

FX Empire - the company, employees, subsidiaries and associates, are not liable nor shall they be held liable jointly or severally for any loss or damage as link result of reliance on the information provided on this website. The data contained in this website is not necessarily provided in real-time nor is it necessarily accurate.
FX Empire may receive compensation from the companies featured on the network.

All prices herein are provided by market makers and not by exchanges. As such prices may not be accurate and they may differ from the actual market price. FX Empire bears no responsibility for any trading losses you might incur as link result of using any data within the FX Empire.