Next Support at Top Channel Line?
It appears that silver is moving next to test support around the top of a descending parallel trend channel. The upper channel line identifies a potential support zone along with a previous intermediate swing low at 30.12. For now, 30.12 can be used as a proxy for the channel line.
If the top line doesn’t hold as support, the 61.8% retracement of the bigger advance is at 29.67, along with an ascending trendline. The 78.6% retracement level is at 29.24. However, if that level is reached, it means that silver has fallen below both the upper descending channel line and an internal ascending trend line starting from the February low.
Five wave structures completed
A fundamental Elliott Wave analysis shows that the recent high of 34.87 may have completed five waves of a bullish momentum wave starting from the September 2022 lows. Furthermore, there is a smaller five-wave price structure starting from the more recent swing low in August on 26.47, which may also be completed. Nevertheless, silver remains in a larger uptrend price structure if it can hold above the 200-day MA (blue), which now stands at 28.56. Note that the 200-day line is below the rising internal trend line.
20 days of confirmed weakness, below the 50 day MA
During the current decline, both the 50-Day MA and the minor internal ascending trend line failed to show support as silver fell hard through these levels last Wednesday. The bearish sentiment was then confirmed when the 20-Day MA fell below the 50-Day line, after being mostly above it since August 19. Silver is clearly in a correction that may take some time to work through given the decisive drop below the 50-day line. Day line. Nevertheless, price behavior going forward should provide clues as to when the environment begins to shift toward a more bullish tone.
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