After a significant momentum in Silver 11.77 to 29.85 silver started correcting in the month of Sep 2020 towards 21.66. Last week silver plunged 14.5% which offers a potential momentum pullback tradesetup towards the continuation of the previous uptrend.
Silver is firmly trading very close to the previous swing high 16.90 and the daily sentimental RSI continues to be positive for the 15th trading session and currently consolidating around the previous swing high reference. .
Now silver is trading around $16.36 mark & as we can see on charts, silver rally was strongly rejected by descending trend line & this will be the 4th time when we have a rejection here. This shows the strength of the trend line. As well as the price are trading well below 38.2% fibonacci retracement now with RSI below 50 mark now.
Recently, Indian govt announced a particular scheme in their budget notes which took a lot of attention, especially gold merchants and speculators. With gold prices tumbling since last couple of years, the new scheme-if it works, would not only increase the supply of precious metal at domestic level, in-turn cuts our international gold imports which further depresses the price at global scale.
If you are a regular reader of my articles, then you know “I hate technical indicators”. They are a derivative of price action, nothing more than a mathematical complex paralysis. My clients frequently question me-“Hey do you use any indicator”? Most probably my reply will be no-because majority of you guys know, I am a pure Price action trader!
Fundamental remains very weak for silver from last few months, gold with bad performance in 2014 kept pressure on silver as well as slowdown in leading manufacturing economy china slashes silver demand as industrial metal. With a positive start of 2015 from gold & a major expectation of QE from china , japan & europe together could provide a supportive ambiance for this metal.
Out with the old: Super Commodities such as Gold, Silver,Oil etc are in a so-called secular bear market that may stretch for years.Remember the commodities supercycle, that seemingly endless 2000s commodities boom? It drove oil, gold, copper and other commodities to record levels may be moving out of order
Gold bounce sharply as expected & broken the $1172-1182 resistance area turned into support now. After a sharp rise, profit booking is always been a normal thing. We expect to retest the support zone before making another upside move.
Gold consolidating after sharp fall & trying to retest the broken support level turned into resistance. WE may witness more weakness as far as $1182 area remains as EOD resistance.
Now silver is trading around $17.46 area & as we can see on charts, silver probably building support from 161.8% Fibonacci retracement of the last upside move. This level could be consider as neckline for silver future movement & well supported by the candlestick pattern & oversold indicators.
Now silver is trading around $19.78 & as we can see on charts silver fall sharply with gold in last weeks, even little more compare to gold. Meanwhile it touched the 161.8% feb correction area of the last ascending wave around $18.86 & bounced back. However the bounce was restricted at 38.2% correction.
GOLD COMEX has stiff resistance @1355-1360$ levels. Markets Looks to be in Favor of Bulls and it Seems that Gold will breach its Immediate resistance Levels. Next Minor Resistance Level that GOLD COMEX faces is @1370 and a Next Major Resistance is @1400$ which would also act as an psychological Level for GOLD. Alternatively if Unable to cross Resistance of 1355$ you may see Sell off below 1330$-1325$ and it can Head towards 1300$ mark.