The silver market was choppy on Tuesday, as we are getting a touch overstretched, and seeing the $70 region offer more noise.
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The silver market has shown itself to be very choppy and noisy during the trading session here on Tuesday as we're hanging around the $70 level. The $70 level is an area that has been very noisy for some time, and I think you have to watch it very closely as it's a large figure. It probably attracts a lot of options traders.
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The 200-day EMA sits just below where we are right now, and I think that is something worth paying attention to as technical traders will be watching that. But at the end of the day, we have a scenario where the market continues to see a lot of questions about whether or not we are going to see any type of follow-through or if we are going to give up some of the gains here.
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The interest rate markets in the United States continue to drift lower, and if that's the case, I think that ends up being a major catalyst. Ultimately, this market I think remains one that you will be very careful to trade in, mainly due to the fact that we have a lot of potential issues just waiting to creep up. After all, the situation in the Middle East will remain a big problem. I think the reality is that it would take very little to spook the markets and that would raise interest rates.
Longer term, I'm very bullish on silver, and I do think that the lack of supply will remain a very important factor here. The $60, for me at least, is the floor in the market at the moment. The $90 is the ceiling. It would take a lot to get there, but if we continue to see a lot of a grind, short-term pullbacks I think a lot of people look at very closely at potential buying opportunities as long as we can remain in the status quo.
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