As we continue to hover near the 50-day exponential moving average, silver markets declined on Tuesday. Ultimately, this market has been in a great downturn for quite some time, and I am confident that this will continue in the future. As the global economy slows and silver being an industrial metal, it is difficult to envisage a circumstance in which you would want to buy silver at this time. Ultimately, we are in a position where the decline has continued, and we continue to closely monitor this line. In addition, we have the $20 level above that which will cause major resistance.
When examining this chart, it is evident that Friday’s hammer is key, and if we break below it, it is likely that the market will target the $18 level. The $18 level is a crucial support level that has been quite tenaciously guarded, indicating that if we were to break below it, silver would likely collapse to the $15 level, followed by the $12 level. At this time, rallies will encounter considerable resistance; thus, if we can break above the $20 barrier, we might reach the $21 level.
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At this moment, the only thing I believe you can bank on is a great deal of volatility; hence, I believe that the market will continue to be choppy, and you should be cautious about your position sizing and overall level of aggression.