Silver is stuck near the floor of its multi-month range, and FXEmpire analyst Christopher Lewis sees $57 as the level that decides the next move. A break below it, he argues, opens the door to a slide toward $50.
Silver is holding near the floor of its multi-month range, struggling below its declining moving averages, according to FXEmpire's Christopher Lewis. He points to $57 as the level that matters most: a breakdown there, he writes, opens up the possibility of a drop toward $50.
Lewis flags the $60 area as a zone traders will watch closely, calling it a large level on the charts with a lot of market memory. On any move higher, he sees the 200-day EMA as a major problem and says he does not trust rallies from here.
A strong US dollar and strong interest rates in America are giving the silver market a little bit of trouble, Lewis says. As long as interest rates and inflation concerns push traders toward higher bond yields, he argues, a non-yielding asset like silver is likely to keep struggling. Measured against other currencies, though, he notes that silver is doing better.
For now, Lewis expects silver to bounce around its range. If it breaks through $57, he thinks the metal could really start to sell off; a move back above the 200-day EMA would be the signal that something has changed.
Source: FXEmpire
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