Silver Weekly Price Outlook – Silver Continues to See Buyers

Silver Markets Weekly Technical Analysis

Silver has rallied a bit during the trading week, but it is worth noting that it is starting to pull back a bit from the $60 level. At a glance at this chart, you can see just how overbought this market is. So I am a little bit leery at this point, but this is a perfect example of the old adage that a bullish market climbs a wall of worry. That’s exactly what we’re doing here because anybody who’s traded silver in the past can tell you that it’s a great way to lose money when you see these impulsive moves. After all, a lot of times it will just turn right back around and melt down.

All things being equal, though, it’s certainly worth noting that we’re at an all-time high and have been for quite a while now, about 10 to 12 days. And now we have a situation where we have to ask whether or not we get some type of pullback. If we do, it would make a certain amount of sense that buyers might come in and try to find a bit of value. And one area that I’m definitely interested in is the area between $54 and $55, as it had been significant resistance previously. So it should be support based on market memory. If we can break above the $60 level, we just go parabolic from there. The problem with silver doing that is that sooner or later, it breaks something. And once it starts breaking things, you may see silver skyrocket while everything else falls apart. And then eventually silver falls apart.

So, you don’t want parabolic moves for a whole litany of reasons, but the least of which would be to break the financial system, is not something people were going to be happy with. However, the other thing, of course, is you don’t want to buy silver all the way up at $60 and then see it pull back to 54. That’s a lot of pain to wear in a position. The most important thing here is to make sure your position size is reasonable. I know that there is the urge to go and put a huge position on and try to retire in two weeks, but experience tells me moves like this typically have vicious pullbacks.

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