Bearish below 30.29
A breakdown occurs on a decline below last week’s low at 30.29. That would lead to a drop below the trend line and a drop below last week’s low. It should be emphasized that last week’s candlestick pattern was a bearish shooting star. Perhaps the price was not in the ideal location of the trend as it is within a weekly consolidation zone, but nevertheless the price was bearish. And since the rising trendline correlates with last week’s low, attention should be paid to this.
Previous support around 29.68 to 29.64 could be tested if last week’s low fails to hold as support. While the potential for a triple bottom exists, it is also possible that silver continues lower, below the double bottom, to support around the downtrend line or the 78.6% retracement zone at 29.24. Regarding the double bottom, if last week’s low is broken, the double bottom pattern can be considered a bust. That would be another bearish piece of evidence if this were to happen.
Bulls are likely to appear above 30.29
On the bullish side of the analysis, a sustained rally above Friday’s high at 30.29 would trigger a one-day bullish reversal and a regain of the 20-day MA. Subsequently, a daily close above this high would confirm strength and position silver to likely challenge the double bottom neckline at 31.54 and the recent interim swing highs of 32.33.
During the recent bearish correction starting from the October swing highs, silver maintained its upward price structure as support was seen on the rising internal trendline. This reflects a valid upward trend that is still present. It can be assumed that this trend will continue until there is evidence to the contrary. The opposite would first emerge from a decisive decline below last week’s low.
For a look at all of today’s economic events, check out our economic calendar.