Silver Price Forecast – Silver Markets Fill Gap
Silver markets have broken down significantly during the trading session on Tuesday to fill the gap that the so-called “retail squeeze” caused right off the bat. Now that we have filled the gap, it is possible that we bounce from here but quite frankly I think that to assume that the market is simply going to shoot right through the $30 level without serious fight is ridiculous. Unfortunately, I feel that a lot of retail traders have been absolutely crushed by this, as silver markets do tend to be very expensive and very dangerous, and I believe that a lot of people are learning that right now.
SILVER Video 03.02.21
The size of the candlestick is rather impressive, and certainly something that you should not take lightly. I believe that the 50 day EMA underneath is starting to turn to the upside and it should offer support. Furthermore, the $26 level itself has been supportive, and that support also I believe extends down to the $25 level at the very least. In other words, I do not have any interest in trying to short silver, as it is so highly supported underneath, and of course there is still an argument to be made for stimulus driving up demand for silver.
Your capital is at risk
Pay attention to the US dollar, because it has a major influence on silver as well, and you should keep in mind that if you buy silver you are essentially shorting the greenback. The US Dollar Index has seen a significant rally, so that could continue to put downward pressure on silver. Longer-term, I do like silver or a move to $50 but we are nowhere near launching that type of leg higher.
For a look at all of today’s economic events, check out our economic calendar.