Silver is Primed for a Big Move
Silver has been caught in a technical wedge since the all-time highs of April 2011 and the lows of March 2020. Price action in the year of 2023 has started to coil up tightly as prices battle the bottom and topside of the wedge ranges. Moving forward, real interest rate yields, and a slowing Chinese economy will remain major headwinds to silver and the precious metals complex as a whole. Interest rate yields have been breaking out to the upside which have sent prices lower as of late.
With that being said, the 50 Day EMA will provide near term support, and if this level were to fail, the next level to watch would be the 22.55 – 22.75 level on the December 23’ futures contract. The bottom end of the wedge range “Major Trend Line Support” will be the final area of defense for the silver market.
Conversely, if silver can hold the 50 day EMA as support. This shows near term consolidation/strength. We would need to get above 24.00 before we can retest the top end of the wedge range “Major Trend Line Resistance” and this top end will act as a brick wall for the silver market. To understand momentum, as the silver market is approaching major support and resistance levels, a trader can use the Golden Cross, or Death Cross Strategy. The Golden Cross occurs when the 50 day EMA crosses above the 200 day EMA, while the Death Cross occurs when the 50 day EMA crosses below the 200 day EMA.
Check out CME Group real-time data plans available on TradingView here: tradingview.com/cme/ Disclaimers: CME Real-time Market Data help identify trading set-ups and express my market views. If you have futures in your trading portfolio, you can check out on CME Group data plans available that suit your trading needs tradingview.com/cme/
*Trade ideas cited above are for illustration only, as an integral part of a case study to demonstrate the fundamental concepts in risk management under the market scenarios being discussed. They shall not be construed as investment recommendations or advice. Nor are they used to promote any specific products, or services.
Futures trading involves substantial risk of loss and may not be suitable for all investors. Trading advice is based on information taken from trade and statistical services and other sources Blue Line Futures, LLC believes are reliable. We do not guarantee that such information is accurate or complete and it should not be relied upon as such. Trading advice reflects our good faith judgment at a specific time and is subject to change without notice. There is no guarantee that the advice we give will result in profitable trades. All trading decisions will be made by the account holder. Past performance is not necessarily indicative of future results.
With that being said, the 50 Day EMA will provide near term support, and if this level were to fail, the next level to watch would be the 22.55 – 22.75 level on the December 23’ futures contract. The bottom end of the wedge range “Major Trend Line Support” will be the final area of defense for the silver market.
Conversely, if silver can hold the 50 day EMA as support. This shows near term consolidation/strength. We would need to get above 24.00 before we can retest the top end of the wedge range “Major Trend Line Resistance” and this top end will act as a brick wall for the silver market. To understand momentum, as the silver market is approaching major support and resistance levels, a trader can use the Golden Cross, or Death Cross Strategy. The Golden Cross occurs when the 50 day EMA crosses above the 200 day EMA, while the Death Cross occurs when the 50 day EMA crosses below the 200 day EMA.
Check out CME Group real-time data plans available on TradingView here: tradingview.com/cme/ Disclaimers: CME Real-time Market Data help identify trading set-ups and express my market views. If you have futures in your trading portfolio, you can check out on CME Group data plans available that suit your trading needs tradingview.com/cme/
*Trade ideas cited above are for illustration only, as an integral part of a case study to demonstrate the fundamental concepts in risk management under the market scenarios being discussed. They shall not be construed as investment recommendations or advice. Nor are they used to promote any specific products, or services.
Futures trading involves substantial risk of loss and may not be suitable for all investors. Trading advice is based on information taken from trade and statistical services and other sources Blue Line Futures, LLC believes are reliable. We do not guarantee that such information is accurate or complete and it should not be relied upon as such. Trading advice reflects our good faith judgment at a specific time and is subject to change without notice. There is no guarantee that the advice we give will result in profitable trades. All trading decisions will be made by the account holder. Past performance is not necessarily indicative of future results.
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