Silver markets continue to go back and forth in general, with the $17 level underneath offering support while the $18 level above offers resistance. Furthermore, the $18 level features a gap just above it that although has been filled previously, should continue to offer a little bit of resistance. The question now is whether or not we are simply trying to build up momentum to go higher and reach towards $19, or are we going to continue to fall? If we break down below the $17 level then I think that the next support level will be the 200 day EMA, currently sitting at the $16.38 level.
SILVER Video 25.05.20
I also believe that the 50 day EMA is sitting just below the $16 level will offer a lot of support. This has been an extraordinarily strong sign, and one has to wonder whether or not silver is trading on industrial demand or if it is trading on the precious metals trade. I suspect the latter of the two is going to be the answer in the end, but the industrial component of silver continues to work against it in general. If you are looking for precious metals trade, silver is one way to do it, but it is going to be much more palatable from my volatility perspective to trade gold than silver. I am not saying silver can go higher, just that it can also go lower a lot quicker. Furthermore, the silver futures contract is much more expensive than the gold contract, so that comes into play as well.
This article was originally posted on FX Empire
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