If the silver market were to experience a pullback, the $23 level could potentially provide some support.
- Silver had a mixed trading session on Tuesday, moving back and forth in a narrow range.
- The market is currently facing strong resistance near the $24.60 level, where selling pressure has consistently pushed prices lower.
- If the market is unable to break above this level and take out the large, round, psychologically significant $25 level, we are likely to see signs of exhaustion continue to be sold into.
Despite the recent rally, the silver market remains overextended, which could lead to some consolidation or a pullback in the near term. However, if this were to occur, we could see strong buying support from investors who view silver as a safe-haven asset and a means of preserving wealth.
One factor that has been influencing the silver market is the anticipation that the Federal Reserve may slow down its monetary tightening policy. However, some analysts believe that this is a pipe dream, and investors should remain cautious when making investment decisions. Ultimately, this is a situation where position sizing will be crucial, but that’s always going to be the case in swing trading silver as it is volatile under the best of conditions.
If the silver market were to experience a pullback, the $23 level could potentially provide some support. Meanwhile, the 50-Day EMA is currently sitting at the $22.53 level and is starting to rise, which could also act as a dynamic support level.
It’s important to be cautious when entering the silver market, given its recent overextended state. Looking for value and buying on dips could be a wise strategy, rather than entering the market with a large amount of money all at once. Building a position based upon value is probably going to be the best way going forward that you can trade this market, as there is so much in the way of resistance above, and it will be difficult to break through.
Ultimately, the silver market is facing strong resistance near the $24.60 level, and we may see signs of exhaustion continue to be sold unless the market can break above $25. While the silver market remains overextended, it continues to be viewed as a safe-haven asset, and any pullbacks could be met with strong buying support. Traders should remain cautious when entering the market and try to find value and buy on dips.
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