The price of silver has declined significantly during the past week, displaying signals of weakness once more. The $18 level is a large, round, psychologically significant number, as well as a historically important support level. If that level is breached, the $15.00 level could become a potential target for sellers. Clearly, this is a very bearish weekly candlestick, and it suggests that longer-term losses will continue.
The US dollar continues to be a wrecking ball for practically everything, and silver is particularly sensitive to the dollar’s value. The Federal Reserve obviously continues to tighten monetary policy as interest rates continue to increase. If such is the case, industrial demand would most likely be stifled, and a global recession will almost certainly ensue. If this recession occurs, it is difficult to imagine silver gaining traction very soon.
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However, if the Federal Reserve decides to alter its general stance, silver prices could rise, though I believe this is unlikely. In light of this, I predict that the market will continue to be extremely volatile for the foreseeable future. However, once the Federal Reserve reverses course, we might witness a major move to the upside in a longer-term “buy-and-hold” scenario. At the moment, we are still very much in a trading range, but I find it hard to imagine becoming positive on this market anytime soon.
