The selling, which was evident for both gold and silver on January 8, has had a more profound and longer-term impact on the industrial metal, which has struggled to recover ever since and has remained rangebound around the volume point of control at $18 per ounce, and is now an area layered with various levels of support and resistance.
From a bullish perspective, the most important of these is the resistance line immediately above the VPOC (yellow dash line) at $18.05 per ounce and denoted with the red dashed line. This is a level which has been tested repeatedly over the last few weeks and held firm with one exception. Below are several support areas, the strongest of these at $16.60 per ounce.
The key for silver is dependent on the performance of gold and much like the U.S. indices, it will be a case of one pulling the other higher. In this case, gold is pulling silver with it as the bearish sentiment is weighing heavily, and is also confirmed by the trend monitor indicator. Note the weakness in the rally of late January with the volume falling away, before the sellers moved in once more.