Silver markets initially tried to fall during the trading session on Monday but continues to find buyers underneath. The $22 level underneath offers a significant amount of support that a lot of traders will be paying attention to, so therefore it is difficult to imagine that we are simply going to slice through the bottom. Even if we did, the 200 day EMA comes into the picture at $20.50 below, and then of course we have the psychologically significant $20 handle after that. If we were to break down below the $20 level, then I think it is likely that we would see the market break down drastically.
SILVER Video 29.09.20
All things being equal, if we can turn around a break above the $24 level, we will more than likely go looking towards the 50 day EMA which is just below the $25 level. That is an area that will attract a certain amount of attention, and I think at the very least we need to grind a bit in order to break out to the upside. I do believe that the market is likely to continue to see a lot of volatility, and therefore I think you should probably be a very cautious about how big of a position you put on. At this point, I think that the longer-term trend is still to the upside, but obviously with a lot of the questions when it comes to the global economy, the market is trying to figure out whether or not there is going to be enough demand due to the fact that silver is an industrial metal more than anything else.