Recent run higher took the price to the highest level since June 2018
When I look at metals, I tend to focus on gold. However, silver has had a pretty good run higher over the last two months as well.
Technically looking at the daily chart above, the price since bottoming on May 28th, has moved from $14.29 to a high last week at $16.65. That is a 16.5% run. Not a bad move at all.
On the way, the price ran above the 100 and 200 day MAs (blue and green lines, and after a correction back toward those MA lines, surged above a topside trend line at $15.55 area, a higher trend line at $16.01 (nice natural level too) and swing highs from January and February at $16.19 (close risk now on the daily chart). Bulls have taken control.
Drilling to the hourly chart below, the price action has seen a period of consolidation after peaking on July 24 at the $16.65 level. Since then, the price has rotated down to the $16.32 level where there have been a number of lows (in the area). The price has been able to move below the 100 hour MA (blue line) on the correction lower, but so far been able to stay above the rising 200 hour MA (green line), currently at $16.372. There is a battle going on between the $16.65 level above and the $16.32 level below, with the 200 hour MA also in play.
If the price is able to crack the 200 hour MA and then the floor at $16.32, that should be enough to turn some of the buyers into sellers for a retest of $16.19 (support from the daily) and then the key $16.00 level. Below $16.00 and things get more worrisome for the bulls.
If, however, the $16.32 floor (see green circles) on the hourly can hold, I would expect another retest of the highs at $16.65 with a break then targeting the $17.35 highs from April and June 2018 (see daily chart).
So…battle on traders but look for the next shove (lower or higher) to provide the directional bias going forward.
PS. Giles Coghlan posted on silver yesterday and pointed out that the 50 day MA crossed over the 200 day MA. That move is called the Golden Cross and is supposed to be a bullish development. That may or may not pan out in the short term. That is, just because the MAs crossed does not necessarily mean we cannot have a correction (so continue to watch the aforementioned support levels). However, it does tend to signal to buy the dips at least in the near term. You can read Giles’ post HERE.