More likely than not, a pullback is on the horizon, perhaps down to the 50-Day EMA if the US dollar starts to strengthen again.
- Silver markets are traditionally very noisy, and the last couple of weeks have been no exception. The $23 level seems to be attracting a lot of attention as it had previously been supported.
- The silver market will continue to be sensitive to the US dollar, which has been on its back foot as of late, helping lift silver pricing.
- However, the market seems to be getting a little overextended in general, and the previous session’s candlestick was a shooting star, suggesting that a pullback could be on the horizon.
Moreover, there is a lot of resistance just above the current level, indicating that the upside may be somewhat limited. Breaking above the $24 level is challenging to get bullish on silver without some significant selloff in the US dollar. Resistance has been seen near the $24.50 level and the $25 level, which is thought to be a gateway to much higher prices. However, a move all the way toward the $50 level would require a Herculean effort.
More likely than not, a pullback is on the horizon, perhaps down to the 50-Day EMA if the US dollar starts to strengthen again. Just below the 50-Day EMA, the 200-Day EMA sits just below the $22 level. This is an area that will be interesting as there had been quite a bit of price action in that same general vicinity.
While a pullback is expected, a drastic selloff in the silver market is not necessarily anticipated.
The current situation with silver highlights the importance of closely monitoring market trends and adapting investment strategies accordingly. Silver markets are typically very volatile, and investors must be prepared for potential losses while seeking opportunities for gains. Keep an eye on economic indicators and geopolitical headlines, as silver is not only used as a safety metal but also is used as an industrial one. If the industry is going to demand less, that obviously would put a bit of a drag on the silver pricing, and it may underperform gold.
While I believe that there will be plenty of volatility, it’s worth noting that keeping your position size reasonable, as I would anticipate that there would be a lot of potential for massive movement. With this, the only thing you can do to protect yourself is riskless.
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