Silver poised for a breakdown?
After a precipitous drop to test support near 23.00 (the 38.2% Fibonacci retracement of the March 2020 – March 2021 rally) early this month, Silver has spent the last three weeks consolidating in a range between 23.00 and 24.00.
As experienced traders know, volatility tends to be cyclical, meaning that markets alternate between periods of large trending movements and small rangebound trade. We’ve seen this exact dynamic play out with silver stair-stepping lower over the last three months, alternating between periods of sideways, rangebound trade and sharp drops.
Looking ahead, traders will be keeping a close eye out for a break of support at 23.00 to signal another potential leg lower down toward at least 22.00 or lower. A bullish break above the 24.00 level would invalidate the bearish bias and open the door for a rally back toward 25.00.
For more on the recent moves in silver and how the gold/silver ratio can provide insight for precious metals traders, see our Senior US Analyst Joe Perry’s article “Which is better to own right now: Silver or gold?”: forex.com/en/market-analysis/latest-research/which-is-better-to-own-right-now-silver-or-gold/
As experienced traders know, volatility tends to be cyclical, meaning that markets alternate between periods of large trending movements and small rangebound trade. We’ve seen this exact dynamic play out with silver stair-stepping lower over the last three months, alternating between periods of sideways, rangebound trade and sharp drops.
Looking ahead, traders will be keeping a close eye out for a break of support at 23.00 to signal another potential leg lower down toward at least 22.00 or lower. A bullish break above the 24.00 level would invalidate the bearish bias and open the door for a rally back toward 25.00.
For more on the recent moves in silver and how the gold/silver ratio can provide insight for precious metals traders, see our Senior US Analyst Joe Perry’s article “Which is better to own right now: Silver or gold?”: forex.com/en/market-analysis/latest-research/which-is-better-to-own-right-now-silver-or-gold/
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