Silver Futures Index $SILVER (SILVER)

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Silver Continues to Hang Around the 50-Day EMA
By: Christopher Lewis | October 25, 2023

• Silver continues to see noisy behavior right around the 50-Day EMA, which of course is a widely followed technical indicator.

Silver Markets Technical Analysis

Silver has gone back and forth during the course of the trading session on Wednesday, as we continue to hang around the 50-Day EMA. The 50-Day EMA of course is an indicator that a lot of people will pay close attention to. With this, you get a situation where market participants will acknowledge it and have to make a decision on whether or not to react. If we can break above the 200-Day EMA, the market is likely to continue to reach toward the $24 level. On the other hand, if we break down below the $22.50 level, then you have a situation where $22 could be targeted.

In general, this is a market that I think continues to see a lot of noisy behavior, and with that being the case it’s likely we will see a lot of volatility. However, it’s probably worth noting that silver is highly sensitive to risk appetite and of course the bond markets in general. With this being the case, you need to understand that the 10 year yield is something that you need to be very cognizant of.

Furthermore, silver has a certain amount of industrial demand in its pricing as well, as it is also an industrial metal. It’s not just a matter of “dollar up, silver down, and vice versa”, there are a lot of other external factors as well. That being said, it’s probably worth noting that we had rallied quite drastically, and now are at the very least going to be trying to work off that excess bullish behavior, and now it comes down to a question of whether or not we are going to consolidate, or if we are going to pull back. At this point, it looks more likely than not that we are going to see a little bit of a drop but I also recognize that there was so much in the way of bullish pressure that it is not necessarily going to be easy to short this market. In other words, I think it’s probably more likely this ends up being a correction more than anything else. Expect volatility, and keep your position size reasonable.

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