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Silver Continues the Bounce From Last Week

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The silver market has been extraordinarily bullish, and this appears to be a great opportunity for traders to pick up some value in the market.

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The silver market showed some signs of life during the trading session on Monday, despite the initial pullback. The $22 level is currently acting as significant resistance and could cause a bit of difficulty if the price continues to rise. If the $22 level is broken, we can anticipate a potential move to the $22.50 level and then potentially to the 50-Day EMA, which is also an area that has seen resistance in the past. The $22.70 level is also an area where we could expect some resistance.

Silver Could Reach the Highs

  • A move above all these levels could mean that silver is headed for the upside and could reach the highs we have recently seen
  • Keep in mind that silver has a negative correlation with the US dollar.
  • So, if the dollar starts to sell off, silver will likely benefit.

The 50% Fibonacci level has offered significant support during Friday’s trading, forming a nice-looking hammer that is expected to attract interest from many traders. However, there is no guarantee that this support level will hold. If the hammer is broken, the price could drop down to the $20 level, and even as low as $19.50, where it previously took off from.

It is important to keep in mind that silver is an extremely volatile market under the best of conditions, and the prices can fluctuate significantly. Therefore, it is advisable to keep your position size reasonable. The silver market has been extraordinarily bullish, and this appears to be a great opportunity for traders to pick up some value in the market.

In conclusion, the silver market has recently shown signs of life, and if the resistance levels can be broken, it may continue to rise in value. The market is volatile, so traders should keep their position size reasonable. The negative correlation with the US dollar makes it likely that silver will benefit from a dollar selloff. Therefore, traders should keep a close eye on the dollar movements as they could indicate potential price changes in the silver market. It’s also worth noting that silver has a high correlation to what’s going on with gold, so pay attention to silvers bigger brother to give you a bit of an idea as to the overall directionality of the market. With that being said, silver does tend to be quite a bit more dangerous.

XAG/USD chart

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