Interest rates are falling in the United States, yet silver is doing the same. This shows a change in the attitude of the markets and is something worth watching. Friday is a US holiday, which influences things as well.
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Silver tried to recover after initially gapping lower during the trading session on Thursday, with the $70 level offering a bit of a barrier. Ultimately, we are hanging around the 200-day EMA and dropping from here, as we look soft at this point in time.
What I find interesting is that interest rates are falling at the same time silver is falling. So, this is a little bit of a dichotomy from what we saw. All things being equal, it looks like silver probably tries to run down to the $60 level, which is the bottom of the overall consolidation region.
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Holiday Liquidity and Key Technical Levels
With this, I believe we have a market that is worth watching very closely as we are heading into the Juneteenth holiday on Friday, which will close down a certain amount of liquidity for most of the session.
There will be some early electronic trading on Friday, but really, that's it. Silver looks like it's going to start drifting a little bit lower. We'll see how it plays out on Monday, when proper liquidity again. At this point, the markets are in the process of changing, but headlines could drive what happens next.
And that, I think, will be an interesting thing to watch overnight as we head into Friday with the Asian morning trading. We could very well see a little bit of follow-through. But if we were to rally from here, the $70 level, at least for me, is a bit of a barrier that will be very difficult to overcome.
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