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Friday, 02/23/2024 4:22:18 PM

Friday, February 23, 2024 4:22:18 PM

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Silver Continues to Bounce Around a Range
By: Christopher Lewis | February 23, 2024

Silver was rather quiet during the trading session on Friday, as we are sitting in the middle of the range that we have been in for some time. Because of this, I think you have a situation where silver is somewhat neutral in the short term, but we have very clear areas to be trading from.

Silver Markets Technical Analysis

Silver markets have shown themselves to be somewhat nonchalant in their trading during the session on Friday, as we are basically just in the middle of the consolidation area between the $22 level and the $23.50 level. This is a market that I think will continue to do all of the usual behaviors, such as reacting to interest rates, the US dollar, geopolitical concerns, and of course, industrial demand.

With that being the case, it’s essentially a coin flip as to whether or not we touch the top or the bottom of the consolidation area right now. But in the longer term, I do think that the $22 level continues to be a major support level. The $23.50 level above being broken would be extraordinarily bullish and I think it opens up a move to the $24.50 level after that, which is an area we’ve seen action at in the past. Nonetheless, this is a market that I’m waiting to get to one of the extremes to make a trade.

I don’t necessarily want to short silver. I believe that silver is something that will eventually try to get back to the $26 level, especially if central banks around the world are going to continue to cut rates this year, which by all counts, looks to be the case. So, with that being said, I like the idea of taking advantage of cheap silver when it occurs. If we break down below the $22 level, we could then go looking to the $21 level, which was where we broke down in September.

But right now, I think we’re more likely than not to continue to see a buy on the dip mentality. So that’s how I am approaching this market. If we break above the $23.50 level, I’ll probably add to any existing position that I have. That $26 level above, though, I think is going to be a very difficult barrier to break.

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