Silver looks to be heading to an important support area
(Kitco News) - Silver has been moving lower in recent sessions and today is no different as the grey metal is trading 0.40% lower. From a technical standpoint, the price has been making lower highs and lower lows since the 14th August high of $20.87oz. The strength of U.S. dollar has clearly been having an impact on the precious metals sector. Gold has also struggled in recent sessions along with platinum and palladium.
Looking at the 4-hour chart below, the price has broken through the most recent support level at $18.90/oz on 26th August and then used the zone again as a resistance on Monday. The confirmation of the move lower will come if the current wave low of $18.49/oz to make a new lower low wave.
The next support is lying in wait at $18.12/oz. This was a strong zone back in mid to late July. after hitting that support the price moved 15% higher and on the higher timeframes, it is the current consolidation low. It will be interesting to watch the volumes as the price hits that level as the market participation might increase due to the importance of the level. In the U.S. session, we are due to hear from two Fed members and this could inspire some volatility.