Silver Poised for Upside?SLV is setting up a strong case for a position trade. A similar situation recently played out with Palantir, although with greater risk involved due to being an individual stock, but we don't need to exclude the intrinsic value of precious metals. Multiple timeframes are showing technical confluence and this is something to watch beyond 2024.
Key Points:
SLV has formed a larger, albeit lopsided, cup and handle pattern on the monthly chart with another mild version of the same pattern post 2020. The dip having been formed by the 2022 bear market.
Price has simultaneously found support between the Ichimoku Kumo(formed by an offset of the average price between highs/lows) and a well-defined static support/resistance zone indicating stability.
The "Golden Cross" remains well intact from its formation in Q2 of this year. This is bullish bias.
The slow stochastic, also formed by highs/lows as opposed to a rate of change, has pulled back from overbought territory on both the weekly and daily timeframes. The weekly stochastic appears to be a well balanced oscillator for SLV. I personally find ROC oscillators and MA crosses better for exits.
We do have a bearish engulfing candle on this timeframe suggesting near term weakness, so it's critical to watch for incoming support.
Final Thoughts:
Silver remains structurally strong and we have a bullish case on multiple timeframes. While short term bearishness indicates caution, the overall technical picture suggests solid upside potential.
Support: $26
Resistance: $30.5
Target: $34+
