Negative divergence warning to longs in overcrowded Silver trade

Negative divergence in momentum indicators including the RSI shouldn't be ignored by longs in the overcrowded Silver trade.

• Silver currently trading around 20.20
  
• Selling has been seen 50 cents higher around 20.70 over the past month
  
• Support levels: 19.09 (38%), 17.83 (62%), 16.94 (78%)
  
• Resistance level: 21.12 (high pivot)
  
• Downside target: $18 (and possibly a test of the upward sloping 2016 trend line currently above $17)
  
• Trade management: Sell within 20.17-76 with a stop (on daily close) above 21.12
  

For further insight and discussion please contact me via Tradingview or LinkedIn, on Twitter @James_LVDTA, and visit www.lexvandam.com to become a member of the Trading Club.

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The case for a retracement may no longer be valid:

Do not get caught short precious metals as the case for owning gold appears to be regaining ground as USDJPY falls.