Silver Forecast Today - 17/12: Silver Holds Trend (Chart)


(MENAFN- Daily Forex)

  • In my daily analysis of the commodity markets, the silver market has captured my attention as we are sitting just above a major trend line.
  • Because of this, I think we are at an area of inflection, with silver more likely than not going to be paying close attention to what happens over the next couple of days.

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Keep in mind that the uptrend line that dissects the $30 level goes back to the beginning of the year, and at the same time we also have silver bouncing around between the 200 Day EMA and the 50 Day EMA. Ultimately, this is a market that is very volatile and noisy, and of course with interest rates being stubbornly high, it does work against silver at times. However, it's worth noting that we are between 2 major moving averages, with not only the uptrend line sitting below to offer support, but we also have the $30 level to offer support as well. In other words, I do think that there are a lot of buyers underneath, at least from the technical side.

Keep in mind that Thursday is the Federal Reserve interest rate decision, and because of this we will probably have a lot of volatility later in the day. However, I also recognize that silver is an industrial metal as well, so it does cause a bit of chaos at times when your position size is incorrect. It is because of this that even if you were to see a bit of a bounce, I would probably be very cautious, due to the fact that the Thursday session should be a bit of a nightmare for those hanging onto this over with too big of a position.

If we were to break down below the 200 Day EMA, near the $29.40 level, then I think the market is likely lunch from there. From a technical analysis standpoint, you could start to make the argument for a potential head and shoulders pattern, but I think it's also a little early to call that a concern. If we were to break below the 200 Day EMA, then the head and shoulders could be confirmed.

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