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Silver smashed into a buying opportunity?

Commentaries & Views

Below is a 4-hour chart of silver (updated from the 3-hour interval I showed Monday).

Unfortunately, silver broke down from the arc. However, it should not have been a surprise to regular readers that further selling has ensued. I also cautioned Monday that the probability would be such should a breakdown occur. The silver lining is that the price now sits in the $23.80 zone, a level that has served as support/resistance. This level is likely to offer a springboard for a short-term bounce if it can hold up and if gold co-operates.

Thus far, gold is holding the $2000 spot level and channel I showed Monday; the daily gold chart is updated below with two more trendlines I believe may act as support should gold lose $1990.

As I have written many times – only fortune tellers pretend to divine the future, and the best market participants can do is try to define probability. Nimble traders may have an opportunity to capitalize on a short-term swing using the levels I have presented above as a guide to determine risk/reward. Stackers and positional holders could zoom out and look at the move that started from $1650 for a perspective on when their next buying opportunity is best.

Have a great weekend.

P.S. Although the irony of one infamous banking CEO eluding to what he seems to think would be a righteous ban on short-selling the banks while engaging in naked shorting PM futures is not lost on me – I will continue to opine on price action as it exists within current market conditions regardless of how subjectively “fair” those conditions may seem.

Disclaimer: The views expressed in this article are those of the author and may not reflect those of Kitco Metals Inc. The author has made every effort to ensure accuracy of information provided; however, neither Kitco Metals Inc. nor the author can guarantee such accuracy. This article is strictly for informational purposes only. It is not a solicitation to make any exchange in commodities, securities or other financial instruments. Kitco Metals Inc. and the author of this article do not accept culpability for losses and/ or damages arising from the use of this publication.