Silver Prices Continue to Erode into Big Picture Support Zone
- Trend lower still in place
- Long-term support zone still has room to go until the bottom
- Yellen to speak tomorrow at Jackson Hole
After a brief pause and bounce late Monday into Tuesday, silver prices have continued their slide into the long-term support zone (19 down to low-18s) we were discussing earlier this week. Not even the important 19.20 level which held silver up for over a month was retested before resuming the trend lower. The long-term support zone still has room to go before the bottom is met, with right around 18 marking the trough.
The benefit of the doubt remains with the current path of least resistance (down), but we will continue to be mindful that while the shorter-term trend is pointed lower, silver is trading in an area which could attract longer-term buyers. We won’t be interested in longs, though, until price action warrants such; that is, we see a strong shift in momentum. For now, those trading on the intra-day time-frames, continued weakness is probable in the short-run.
Tomorrow, Yellen is slated to give a speech at the Jackson Hole Symposium. It is unclear, though, whether the Fed chair will give any strong indications which will have a material impact on markets. Many expect it to be a relatively uneventful round of words, but as per usual, if you are involved in the market you must always be on alert for unexpected.
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---Written by Paul Robinson, Market Analyst
You can follow Paul on Twitter at @PaulRobinsonFX.
DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.