The silver markets as you can see fell hard during the course of the day on Thursday, breaking below the $18.70 level at one point during the day. The candle for the session is relatively bearish, although we did get a little bit of a bounce from below. However, I think that this market has already shown that it is more than prepared to continue going lower, and with a very strong US dollar, it makes sense that we will continue to see selling as far as silver markets are concerned. It is because of this that I am very bearish as far as leveraged instruments are concerned. Having said that though, I am buying physical silver all the way down in little increments for longer-term buy-and-hold type of situations.
The breaking below that level of course is a negative sign, and I believe that the next major support area is going to be found down at the $15.00 level. Because of that, I think that we could even go as low as $13.00, which is an even more interesting support level on longer-term charts. In other words, I think silver is in trouble for white some time. However, as the US dollar starts to sell off again as it typically will do, silver will suddenly become very attractive.
Industrial demand.
If we can ever get out of this economic malaise, silver will pick up due to industrial demand if nothing else. After all, silver is used in a variety of applications, and as a result it will only be a matter time before goes higher. That is why I’m buying physical silver, yet shorting it in the CFD and futures markets. Buying puts in the binary options market might be the way to go as well, and as a result I think there will be plenty of selling opportunities every time this market rallies. I will be looking for a longer-term buy signal in order to start going long, and until then I will simply sell and sell again.
