Wednesday is Veterans Day in the US, as well as Remembrance Day in Canada, driving volumes down. However, we have seen some telling movement. Ultimately, silver continues to see a lot of the same issues, though.
Silver
The silver market gapped higher to kick off the trading session here on Wednesday, rallied, and then promptly gave back about half of those gains. This is a bit telling, as buyers simply have no real strength at this point.
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That is not a huge surprise, considering that real yields in the United States continue to pay you to hold paper. So, a non-yielding asset such as silver is going to face a bit of a headwind in that environment.
The $55 level above continues to be a major ceiling barrier for silver bulls
The candlestick giving back the gains the way it has suggests that perhaps this is a market that still is a fade-the-rally type of situation. The $55 level above continues to be a major barrier and ceiling for silver bulls, and I just don't see that changing anytime soon.
However, if we were to break significantly above the $55 level, you could make an argument that we could go looking to the upside, perhaps to the 50-day EMA. But right now, I think you need real yields cooling off in America.
Real yields refer to the amount you get paid above official inflation on bonds, as far as interest rates are concerned. As long as those real yields continue to offer a viable alternative, and we have to worry about the AI bubble falling apart, I think silver struggles.
The industrial backdrop is picking up a little bit in some of the silver-sensitive parts of the U.S. economy, but nothing drastic. This is a market that can find itself testing $45 on some type of significant surge with rates. Right now, I think you still have to look to the downside.
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