Silver rallies significantly during “risk off” trading on Monday
Silver markets rallied significantly on Monday as tensions continue to be a problem when it comes to the geopolitical situation. I believe that if the market participants continue to fear a trade war, and tension certainly seem to be escalating, we will probably continue to see Silver get bid on dips. It doesn’t mean that we are ready to break out of the larger consolidation yet, which I see as having a major support level at the $15.50 level, and resistance at the $18.50 level.
Expect a lot of noise, but ultimately, I think that every time we pull back it’s likely a nice buying opportunity. The $16.25 level underneath continues to be supportive, and I think that every time we pull back short-term traders will come back in and take advantage of Silver. I think that if the longer-term outlook remains the same, I think that eventually we will break out to the upside, so I have been buying physical silver. I think that the CFD market is also a possible outlet as well, but I would be cautious about futures markets unless you have the proper account size.
Your capital is at risk
The $18.50 level above being broken should send this market to the $20 level, and a break above there should send this market much higher. If we break down below the $15.50 level, I believe that the ultimate bottom of the support is closer to the $15 level. Think of it as a zone.