- Silver pulled back a bit during the course of the trading session on Monday, as we have possibly formed a bit of a double top.
- That being said, the $32.50 level is an area that looks like it's going to be a very difficult barrier to break above.
- I think we were a little overdone anyway, so I think this pullback will be good for silver, and I think it does offer a bit of support and value.
The 50 day EMA is racing towards the $30 level. And of course, the main driver of the CFD that you see in front of you is going to be the futures market. Therefore, futures markets pay quite a bit of attention to the options markets. Options markets tend to focus on these big figures.
There is Still a lot of Support
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So, with that being said, I do think that there is a certain amount of support underneath, and I think it will keep a bit of a floor in the market. If we turn around from here and break above the $32.50 level on a daily close, I think that's a big victory for the bulls, and it could send silver looking towards the $35 level. Interest rates dropping around the world certainly can help. Geopolitical tensions, of course, can add to that as well. But really, silver is a different beast than gold and that is a mistake that most retail traders make.
They believe they're the same thing. While they may in general move in the same overall direction, they can move at radically different speeds. I do not think the demand for silver is anything like it is for gold, but I still remain bullish, at least as things stand right now. If we see industry start to collapse, that could put downward pressure on silver while lifting gold, so be aware of that. The US dollar shrinking of course helps, but really at this point in time, I think you're looking for a better entry price.
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