Silver markets pulled back during thin trading on Monday as traders came back from the weekend. With the holiday schedule, and of course volume would have been late, so I don’t read too much into the pullback other than the 61.8% Fibonacci retracement level offered a bit of a bid. Below there, I think the $15 level of course will offer support as well, so I think it’s only a matter of time before we bounce. Quite frankly, I have no interest in shorting Silver, because the US dollar, although strengthening over the last couple of days, has to deal with the Federal Reserve changing its stance over the last couple of days. That being the case, the market looks likely to punish the US dollar of the longer-term. I look at pullbacks and silver as an opportunity to pick it up at a better price, as I do believe the longer-term trajectory in silver is going to be higher.
SILVER Video 22.01.19
If we do break down below the $15 level, then I think there is a lot of trouble ahead, perhaps a strengthening US dollar due to some type of major issue in the financial markets. Having said that, we formed a massive base before we broke above the $15 level, so I think ultimately you should be rewarded with profits if you are on the long side of the contract. At this point, I believe that we will retest the $16 handle.
This article was originally posted on FX Empire
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