Silver – Finally Taking Cues From Big Brother
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- Silver breaks above important trendline
- October high is a critical long-term pivot
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Silver – Finally Taking Cues from Big Brother
Gold finally managed to close above the October high yesterday and is surging this morning. The bear looks to be dead. Silver is also getting very interesting technically. While it is still quite a ways away from the October high it did manage to break convincingly above the downward sloping trendline connecting the May and October highs around 15.40 this morning. This is a clear positive for the metal that can be construed as a bigger bottoming trigger especially if we can manage to close the week over 15.40.
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Like in Gold, the first part of next week is important “time resistance” and if the trend is going to take a breather then that is probably the right time for it to do so. The top of the 1-year standard deviation channel coincides with the 50% retracement of the May – December decline around 15.70 and this is immediate resistance to watch for a reaction. If the metal can move above there then attention will shift to the Fibonacci confluence area between 16.03 and 16.20 ahead of the broader double bottom trigger at 16.34. The 200-day moving average around 15.07 is clear support given yesterday’s successful test and only a move under there would warn a correction of some importance is unfolding.
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--- Written by Kristian Kerr, Senior Currency Strategist for DailyFX.com
DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.