Silver Breaks Major Resistances
Previously, I analyzed the Ag on Friday, as the technical situation back the was very interesting. My price action approach was telling me, that we are very close to a major buy signal. The new week started very well, so our view from Friday was spot on. Check out yourself:
“The situation looked dramatic but buyers managed to create a reversal, which is drawing a right shoulder of the Inverse Head and Shoulders pattern. The price closing a day above the yellow area, will be a strong buy signal. “
Your capital is at risk
The yellow resistance mentioned above was broken on Friday as the price managed to close the week almost 10c above that area. The yellow horizontal line was not the only resistance that got broken at the end of the week. Actually, there were many of them! First, let me mention the two red lines, which were the borders of the symmetric triangle pattern. What is more, Silver broke the black mid-term down trendline and came back above the long-term blue up trendline. Quite a lot for one day, huh?
With all this, the sentiment has to be positive. Buyers managed to break all major resistances, using only the small inverse head and shoulders pattern (gray area). The buy signal remains ON, as long as the price is above the yellow area. The aim for the new up wave is the top from the 31st of January. Chances that we will get there are pretty high.
This article is written by Tomasz Wisniewski, a senior analyst at Alpari Research & Analysis