FXS:Silver stalled its relentless advance and fell over $15 in two weeks
The buying frenzy in the world silver market has finally found a top, at least in the near term.
After narrowly missing the all time high near $50 per ounce set in 1980, silver stalled its relentless advance and fell over $15 in two weeks. This rise and subsequent fall has established the widest trading range ever seen in silver, with bullish speculators still very strongly believing new highs are imminent despite the price correction.
The range has narrowed after the initial breakdown, with trading between $32 and $39 per ounce price handles establishing trend line support and resistance for a simple Triangle chart pattern to take form. Silver is now positioned in the middle of this range, which should come to completion in Monday or Tuesday’s session as the trend lines converge.
The Triangle chart pattern carries a mild bias to an upside breakout, which would confirm a continuation of the previous trend higher and likely encourage a retest of the initial resistance at $39.00 per ounce. A break below the key support provided at $33.50 could trigger another leg down and perhaps a move to below $30, which would set a bearish longer term tone for the market.
