Silver initially tried to break above the $95 level on Wednesday, but continues to see a bit of noise in this general area, with the Bank of Japan on deck.
Silver has initially tried to break above the $95 level, but we have seen a little bit of negative pressure during the trading session. I don't think this is overly surprising because every $5, there seems to be a little bit of a reaction, with particular interest paid to the $10 level in Silver charts. It is a very technical market, despite the fact that it has been overbought and an impulsive market as of late.
Top Regulated Brokers
This pullback, more likely than not, will offer some type of buying opportunity, but ultimately, I think you have got a situation where you probably will do yourself some favors to wait for a drop and then a bounce. In a market that is so overbought and so overran like this one, it is very dangerous to just jump in with a huge position because this market could drop down to $75 in the blink of an eye, and it really wouldn't change anything. Except for the fact that your account might be wiped out. After all, the leverage in Silver is part of what makes it attractive, but it is also part of what makes it so dangerous.
Targeting $100
Nonetheless, when I look at the longer-term chart, I just don't see how Silver doesn't at least attempt to get to the $100 level. All things being equal, I think that is an area that offers a certain amount of psychology and maybe a lot of resistance as a result. I think ultimately this will calm down in Silver; it pretty much has to sooner or later.
Then the question is going to be, where is the floor? It is not going to be $12 an ounce again. Realistically, we could find that $50 is now the floor; we just don't know. But that is a longer-term situation. As things stand right now, you are looking to buy dips that show signs of a bounce. There is really no way to short this market presently.
Ready to trade our daily forex analysis and predictions? Here are the best Silver trading brokers to choose from.