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Christopher Lewis

Silver markets have rallied a bit during the course of the week, as it looks like we are trying to challenge significant resistance. At this point time, the market is likely to go looking towards the $20 level, which is an area that has caused a bit of selling. That being said, we look as if we are eventually going to try to break above there. If that is the case, then it opens up the door towards the $30 level which is the gateway to much higher gains.

SILVER Video 04.01.21

One thing that short-term traders do not pay attention to is what this weekly chart looks like. Yes, there had been a bit of a pullback, but it was only the 38.2% Fibonacci retracement. That is not a major sell off and even though it has been a bit stagnant for some time. In fact, I have found that typically if a market pulls back to the 38.2% Fibonacci retracement level and then continues to go higher, that means it has a lot of momentum still left in it, meaning that we should go much higher. After all, when you look at the shot higher earlier this year, it was extraordinary. The fact that we had a pullback as much as we did should not be thought of as a huge surprise to be honest.

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All things being equal, I think that the bottom has probably been put in for the time being, and with the US dollar continuing to get hammered, that should help silver go higher, right along with other commodities that are priced in that currency. Simply put, it takes more of those dollars to buy an ounce of silver.

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

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