Silver Price (XAGUSD) Rallying Through Short-Term Trend Resistance
Silver (XAG/USD) Analysis, Price and Charts
- Silver continues to respect trend support.
- Traders are heavily long silver.
Silver continues to grind higher and is now making a breakthrough a short-term resistance trendline started at the beginning of September. This trendline has held firm over the last six weeks with no daily close and above trend seen. Silver is making a fresh attempt to break this trendline today and is finding fresh impetus off the supportive trendline that started on September 24. These two trendlines are close to joining at the apex, helping to force a breakout. The move higher is also being supported by the 20-day simple moving average.
A recent indecision doji formed on October 12 and the 50-dma cross around $25.53 is the next likely level of resistance before a cluster of recent highs all the way back up to the September 1 print at $28.90. While silver stays above the downtrend, then the supportive trendline should help to guide the semi-precious metal higher.
IG Retail trader data shows 89.72% of traders are net-long with the ratio of traders long to short at 8.73 to 1.The number of traders net-long is 1.66% higher than yesterday and 5.84% higher from last week, while the number of traders net-short is 1.75% lower than yesterday and 15.79% lower from last week.We typically take a contrarian view to crowd sentiment, and the fact traders are net-long suggests Silver prices may continue to fall.
Traders are further net-long than yesterday and last week, and the combination of current sentiment and recent changes gives us a stronger Silver-bearish contrarian trading bias.
Silver Daily Price Chart (March – October 19, 2020)
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