Silver markets have fallen a bit during the course of the trading session on Thursday to find support near the uptrend line. We have turned around to show signs of life again and ended up forming a bit of a hammer like candle said, so at this point in time it looks likely that we are going to see a bit of a basing pattern trying to form itself right now, and if we can break above the 200 day EMA, then I think that the market will start to look quite a bit more bullish, and I think that a lot of buyers will jump in to push this market towards the 50 day EMA. The 50 day EMA of course will attract attention in and of itself.
If we can break up to the 50 day EMA, then we have a chance to try to fill the gap above which ends at the $27.75 area, which would be a huge signal for longer-term traders. To the downside, if we were to break down below the last couple of days’ worth of lows, then the market could go looking towards the $25 level, which breaking down below there would open up the possibility of a move down to the $20 level.
Pay attention to the US Dollar, because it is of course highly negatively correlated to the movement of silver. Keep in mind that the market also moves on industrial demand, so if the reopening trade can continue strengthening, that should strengthen the silver market as well. Ultimately, this is a market that I think will be noisy regardless of what happens next.
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