Silver Weekly Price Forecast – Silver Markets Rally Slightly

Silver markets have barely recovered from the nasty candlestick from the previous session, and quite frankly I think that we probably have further to go to the downside. I do not think that it is some type of meltdown waiting to happen, rather I think that the market just got overstretched and it ran out of reasons to go higher. Furthermore, it does look like the US dollar is going to trying to strengthen, and that of course does not do so for any favors. With that being the case, I like the idea of fading short-term rallies, and do believe that we will at least test the $22 level again, if not the $20 level which is much more important.

SILVER Video 05.10.20

Looking at this chart, the reason I like the $20 level, apart from the obvious psychological standpoint, is the fact that it was the scene of a big breakout. Beyond that, it is also the 50 week EMA which will attract a certain amount of attention from the longer-term traders. Because of this, it is likely that we continue to see volatility more than anything else but more of a downward move. I am not a seller; I am a buyer on dips. I believe that this dip has further to go so it is simply a matter of sitting on my hands. Keep in mind that the US dollar negative correlation with silver still runs high, so if the US dollar suddenly sells off, we may get a little bit more of a relief rally, but of course the exact opposite as possible.

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