Looking at the silver markets in the spot index, you can see that we have broken above the $17.50 level during the session on Monday, and out of the previous large consolidation area. At this point in time, it appears that the market is probably aiming for the $18.50 level, an area that I have circled on the chart. I believe that is a resistive and key level, but if we can get above there I think that silver drives all the way to the $20.00 level. That’s a pretty big move in silver, and as a result it could be very profitable.
Nonetheless, I feel that this market has broken out of something rather restrictive and important, so I believe at the very least we should be aiming for the $18.50 level. On top of that, the US dollar continues to struggle and it appears that the precious metals markets are reacting appropriately.
Buying dips and hanging on
I believe that buying dips on short-term pullbacks will be the way to go going forward in the silver market, but I also believe that if you can build up some type of core position in the CFD markets, you could very well profit from this move quite handsomely. I believe that the precious metals, much like the Euro and perhaps the WTI Crude Oil market have all put in a bottom. This is mainly due to the US dollar and the fact that the Federal Reserve is not going to raise interest rates anytime soon, and the market may had been a little bit overaggressive in pricing that move in.
Ultimately, I think that silver not only breaks out to the $18.50 level, but eventually reaches the $20 level. I think that silver is certainly one of the more interesting trades out there, and if you have the ability to play both the binary options market and the CFD market, I would highly encourage you to do so. I have no interest in selling this market as long as we can stay above the $17.00 level.