Silver: New 18-month high above $17.69
Today’s XAG/USD Signals
Risk 0.75%.
Trades must be taken between 8am New York time Monday and 5pm Tokyo time Tuesday.
Short Trade Idea
- Go short following bearish price action on the H1 time frame immediately upon the next touch of $17.69.
- Put the stop loss 1 pip above the local swing high.
- Adjust the stop loss to break even once the trade is 10 cents in profit.
- Remove 50% of the position as profit when the trade is 10 cents in profit and leave the remainder of the position to ride.
Long Trade Idea
- Go long following bullish price action on the H1 time frame immediately upon the next touch of $17.23.
- Put the stop loss 1 pip above the local swing high.
- Adjust the stop loss to break even once the trade is 20 pips in profit.
- Remove 50% of the position as profit when the trade is 20 pips in profit and leave the remainder of the position to ride.
The best method to identify a classic “price action reversal” is for an hourly candle to close, such as a pin bar, a doji, an outside or even just an engulfing candle with a higher close. You can exploit these levels or zones by watching the price action that occurs at the given levels.
XAG/USD Analysis
We are again seeing Silver in USD terms breaking to new long-term 18-month high prices. There was a new high closing price at the end of last week which was very near the weekly high, and this typically gives a further increase in the trend over the weekend and so it proved to be today.
The price rose strongly to challenge the resistance level at $17.69 which I identified some time ago. The level held, and the price has made quite a deep bearish retracement. It seems the retracement is finding $17.50 a supportive obstacle so far, but it is the probable support levels below that at $17.34 and $17.23 which look more interesting. I would be prepared to take a bullish bias if we get a healthy bounce at either level.
In this era of central banks competing to make their currencies weaker, being long of precious metals is often going to be a trade which makes sense.
Regarding the USD, there will be a release of Core Durable Goods Orders at 1:30pm London time.