Is Silver on the Verge of a Major Move?
21 November 2023
In today's analysis, we turn our focus to silver, a precious metal that has been exhibiting some intriguing movements in the market. Silver's ascent is partly attributable to the recent weakening of the American dollar, yet it still lags behind gold in terms of performance. A closer examination of the chart reveals a critical moment for silver, as it recently encountered its major downtrend line (represented by the upper black line). The price's encounter with this line resulted in a rejection, favoring the bears, albeit briefly.
Following this rejection, silver approached a crucial horizontal support level, situated around $23.5 per ounce, highlighted in green. This level has been validated as a significant support zone. Currently, silver finds itself in a tight range, boxed in by the major downtrend line above and this key horizontal support below. The upcoming price action in this constricted area is poised to set the tone for silver's future trajectory.
If the price manages to break through the upper black downtrend line, it would unleash a bullish wave, signaling a potent buy opportunity. Conversely, a dip below the green support line could trigger a false breakout scenario (indicated by the yellow marking), potentially steering the price towards the lower black line. Such a move would be a clear invitation for bearish trades, with set targets along the lower black line.