Precious Metals Technical Update
Silver has been consolidating after finding support at 30.67. We had a correction back up to the 33.00 level, where the market founds resistance. This was a previous pivot reinforced by the 200-period simple moving average in the 4H chart. This was also the 50% retracement of 35.31-30.67 swing. Note that the RSI reading came up near the 60 level but failed to break it, maintaining bearish momentum. Now it is at 40, and if the market is consolidating, it should get another bounce from 31.50 area in a zig zag scenario, or at 31.00 for more of a flat scenario. If the RSI clears back below 40, price action is also probably indicative of bearish continuation.
The daily chart shows the importance of the 33.00 pivot as it acted as resistance back in September and October. The daily chart also shows a swing projection that has a reach of 20.00. Before that, we have some short-term support levels to monitor as well, the most near-term one at 29.75, near 61.8% retracement and support pivot established on Oct 20. Then the 28.50, just above 78.6% retracement level is reinforced by pivots back on Oct 4 and 5. The 26.00-26.05 area is the September and also 2011 low.
Fan Yang CMT is the Chief Technical Strategist FXTimes - provider of Forex News, Analysis, Education, Videos, Charts, and other trading resources.