Silver market update: While more volatile than gold in terms of price swings, silver often moves in tandem with its shinier cousin. We saw this in the recent price collapse – both markets were down substantially. Silver though hasn’t recovered like gold and is only marginally above its low from Tuesday, April 16. This analysis from Silver Seek provides some insight into where silver may go.
According to 7- and 20-year charts, and other technical data on trading volume, it is possible for silver to test another key support level of $19-$20. These support levels are determined by examining a market’s high and lows over time. Larger than usual volume on last week’s selloff is considered a bearish indicator. On the 7-year chart, you can see how silver broke its support level of $26 last week, and that while $19-$20 may prove to be the bottom, further downside risk would need to be considered at that time. More interesting is silver’s 20-year chart, which includes the inception of the bull market. As we can see, even if silver drops to $15, it will still be in a “bull” market. If the lower trendline fails at that point, the bull market may very well be considered dead. The author notes though that this will (likely) only happen in big liquidation of assets like we saw in 2008. Read more….