Capped! Over the last two days, silver prices tried to break $29.08 but failed and return to look for support at $28.85. It is acting just like gold, trading within a tight band between $28.50 and $ 29.00. However, the short term Bollinger band is converging with a slight bias to the downside. We remain bearish for now despite silver latest attempt to make higher highs and lows.
Low volume trading in yesterday market does not help sentiment. The white metal remains in consolidation mode but the upper Bollinger band is pointing lower to converge. Past technical experience tells us that we are close to a bottom and given that it is oversold, a rally to the upside is possible. In addition, the fast line on the stochastic remains positive and it is awaiting a positive breakout on the MACD to help move prices higher.
Short silver at $ 28.45 with a stop loss of $ 28.55 and target $ 28.15. Looking to buy if $ 29.15 is given and place a long trade to target $ 29.50.
- Resistance: $ 29.50, $ 29.74 (38.2%), $ 30.19 (50%)
- Support: $ 27.93, $ 27.50
