Silver to Continue Finding Buyers Underneath

Kate Leaman
Kate Leaman

4 November 2019

2 min read

Silver trading

  • Relatively neutral candle for Monday
  • Above crucial $18 level
  • Major support just below

Silver markets were choppy and noisy to say the least on Monday, as traders came back from the weekend. Currently, the market is trading above the $18.00 level, which is worth paying attention to.

Beyond that, silver is quite often used for safety, which is useful as central banks around the world continue to liquefy markets. With the easy monetary policy around the world, it should continue to favor precious metals overall. And while gold gets the headlines, the reality is that silver moves right along with it.

we are going to continue to see a lot of upward momentum

Silver has the added benefit of the potential economic rebound picking it up as well, being an industrial metal used in several different processes.

Ultimately, the market has been rising for quite some time. The fact that we pulled back a bit from the 15% gains in August and simply ground sideways with a slight upward tilt suggests we are going to continue to see a lot of upward momentum.

Uptrend observed

The uptrend continues based on what we have seen recently. Therefore, it’s likely that the market will continue to find plenty of reasons to go higher. All it will take is a little bit of a rush to safety to send this market much higher.

However, that central bank easing can be a catalyst as well, so overall it looks as if the longer-term attitude of the market should remain the same.

Technical analysis

Silver chart

Beyond the uptrend, we have the 50-day EMA trading just below current levels, which is quite often going to be used as support. The uptrend line just above there should also offer quite a bit of support, and although the market was a bit choppy during the day on Monday, it does suggest that there are plenty of buyers underneath. If the market was to break down below the 50-day EMA, then it almost certainly would open the door to the $17.00 level.

To the upside, it’s very likely that the market will try to get to the $18.75 level, and then possibly the $19.75 level.

Overall, this is a market that continues to find plenty of reasons to go higher, and it could be more of a longer-term “buy-and-hold” type of scenario.

Silver should continue to find plenty of buyers, and therefore buying on dips should be the best way going forward. Also keep in mind that it is going to be very noisy and difficult, so it most certainly should be patiently paid attention to.

Selling isn’t a thought until we get down below the $17.00 level. At that point, it’s likely that the market will have changed its overall attitude in general, causing lots of pain for those who have been holding silver over the last several months.

Kate Leaman
Written By
Kate Leaman

With over 10 years experience as a trade news writer, Kate is our FX and commodities expert. Kate is also a talented voice over artist and BBC TV presenter, mother of two and yoga fan.

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