Breaking News
0
Ad-Free Version. Upgrade your Investing.com experience. Save up to 40% More details

Silver: Breakout Beyond $26 Tough Without Dollar Wilting 

By Investing.com (Barani Krishnan/Investing.com)CommoditiesMar 23, 2021 04:00AM ET
www.investing.com/analysis/silver-breakout-beyond-26-tough-without-dollar-wilting-200568901
Silver: Breakout Beyond $26 Tough Without Dollar Wilting 
By Investing.com (Barani Krishnan/Investing.com)   |  Mar 23, 2021 04:00AM ET
Saved. See Saved Items.
This article has already been saved in your Saved Items
 

After five weeks of silver's lock-step, directional move with gold, longs in the white metal are resigning to the probability that without a significant dollar retreat, the $26 resistance will remain their point of frustration—just like gold bulls butting heads with low $1,700 pricing.

Silver Weekly
Silver Weekly

All charts courtesy of SK Dixit Charting

While surging bond yields have traumatized risk assets for weeks, the pain has been subdued since the start of this week, with the benchmark US 10-year Treasury note struggling to progress beyond last week’s 13-month high of 1.75%. 

The Dollar Index has picked up the slack instead, staying close to the key 92 level and putting fresh pressure on the two choice precious metals of longs.

In Tuesday’s pre-New York session, spot silver was at $25.645 an ounce by 2:00 AM ET (6:00 GMT), down 0.4% from Monday’s official US settlement.

Silver 4-Hourly
Silver 4-Hourly

Chartist Anil Panchal wrote in a post on FX Street: 

“Unless crossing a confluence of 50-day SMA (Simple Moving Average) and a short-term resistance line near $26.40, silver buyers shouldn’t return to the desk.”

Typically wedded to gold and regarded as little more than the yellow metal’s “poor cousin”, silver breaks out occasionally on its own. Such instances are inspired either by a sudden acknowledgement of its depressed industrial value or the animal spirits of traders trying to buck the trend. But those moments are rare, more so in the present environment where yields and the dollar are commanding the universe of markets, including stocks.

Over the previous five weeks between Feb. 5 and Mar. 12, spot silver lost 4.0% while spot gold lost 4.8%.

Vladimir Zernov, another silver tracker, wrote in a separate blog on FX Empire:

“Silver is still stuck in the range between the support at $25.85 and the resistance at $26.25. Both support and resistance levels have been actively tested this week, but silver failed to develop any momentum.”

He noted that the dollar, meanwhile, was gaining ground against the basket of currencies it was pegged to.

“In case the US Dollar Index manages to settle above the resistance at 92.25, it will head towards the next resistance level at 92.50 which will be bearish for silver and gold.”

Zernov observed that the gold/silver ratio—a measure of how much silver one gets for the price of an ounce of gold—could bring more pressure onto the yellow metal after its cross into the 67-range that it stayed below last week. He added: 

“Silver will have a chance to gain material momentum once it manages to get out of the current range, but it remains to be seen whether silver traders are ready for serious moves ahead of the weekend.”

Sunil Kumar Dixit of SK Dixit Charting in Kolkata, India said unless spot silver sustains above previous week high of $26.63, the metal is headed for a next lower leg in the 50-week EMA (Exponential Moving Average) of $23.60.

Dixit wrote:

“Silver has broken previous week low of 25.74, made low of 25.40 and continues to sustain below previous week low.” 

“Prices are sustaining below 10-week EMA of $26.07 & 20-Week SMA which happens to be middle Bollinger Band of $25.67. These factors make silver bearish on weekly charts. The daily chart shows silver trapped in a tight range, between the 50-Day EMA of $26.22 and 200-Day SMA of $25.61.”

But he said there was a chance of spot silver staging a recovery if markets acknowledged its “oversold Stochastic reading at 22.”

“That can trigger some limited upside pull back to $25.93 and $26.22,” he added.

Silver Daily
Silver Daily

Technicals: Spot Silver Remains A 'Strong Sell'

On my end, Investing.com’s Daily Technical Outlook maintains a “Strong Sell” on spot silver.

My reading shows that should the market extend its bearish trend, a three-tier Fibonacci support is likely to emerge, first at $25.487, then $25.291 and later at $24.972.

In the event of a rebound, then a three-stage Fibonacci resistance is expected to form, first at $26.125, then $26.321 and later at $26.64. 

In any case, the pivot point between support and resistance is $25.806.

As with all technical projections, we urge you to follow the calls but temper them with  fundamentals—and moderation—whenever possible.

Disclaimer: Barani Krishnan uses a range of views outside his own to bring diversity to his analysis of any market. For neutrality, he sometimes presents contrarian views and market variables. He does not hold a position in the commodities and securities he writes about.

Silver: Breakout Beyond $26 Tough Without Dollar Wilting 
 

Related Articles

Silver: Breakout Beyond $26 Tough Without Dollar Wilting 

Add a Comment

Comment Guidelines

We encourage you to use comments to engage with other users, share your perspective and ask questions of authors and each other. However, in order to maintain the high level of discourse we’ve all come to value and expect, please keep the following criteria in mind:  

  •            Enrich the conversation, don’t trash it.

  •           Stay focused and on track. Only post material that’s relevant to the topic being discussed. 

  •           Be respectful. Even negative opinions can be framed positively and diplomatically. Avoid profanity, slander or personal attacks directed at an author or another user. Racism, sexism and other forms of discrimination will not be tolerated.

  • Use standard writing style. Include punctuation and upper and lower cases. Comments that are written in all caps and contain excessive use of symbols will be removed.
  • NOTE: Spam and/or promotional messages and comments containing links will be removed. Phone numbers, email addresses, links to personal or business websites, Skype/Telegram/WhatsApp etc. addresses (including links to groups) will also be removed; self-promotional material or business-related solicitations or PR (ie, contact me for signals/advice etc.), and/or any other comment that contains personal contact specifcs or advertising will be removed as well. In addition, any of the above-mentioned violations may result in suspension of your account.
  • Doxxing. We do not allow any sharing of private or personal contact or other information about any individual or organization. This will result in immediate suspension of the commentor and his or her account.
  • Don’t monopolize the conversation. We appreciate passion and conviction, but we also strongly believe in giving everyone a chance to air their point of view. Therefore, in addition to civil interaction, we expect commenters to offer their opinions succinctly and thoughtfully, but not so repeatedly that others are annoyed or offended. If we receive complaints about individuals who take over a thread or forum, we reserve the right to ban them from the site, without recourse.
  • Only English comments will be allowed.

Perpetrators of spam or abuse will be deleted from the site and prohibited from future registration at Investing.com’s discretion.

Write your thoughts here
 
Are you sure you want to delete this chart?
 
Post
Post also to:
 
Replace the attached chart with a new chart ?
1000
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Thanks for your comment. Please note that all comments are pending until approved by our moderators. It may therefore take some time before it appears on our website.
Comments (11)
Jan Skilbrei
Jan Skilbrei Mar 24, 2021 12:08AM ET
Saved. See Saved Items.
This comment has already been saved in your Saved Items
thanks friend, let us try get in near a bottom perhaps when inflation and gold picks up : )
SunilKumar Dixit
SunilKumarDixit Mar 24, 2021 12:08AM ET
Saved. See Saved Items.
This comment has already been saved in your Saved Items
Jan Skilbrei. You said it right its good to buy the bottom. However, by the time people realize that it is a bottom, it has already moved away from the lows significantly due to momentum buying by value hunters. Going by the prevailing price action is ideal.
Dennis Lawson
Dennis Lawson Mar 23, 2021 7:26PM ET
Saved. See Saved Items.
This comment has already been saved in your Saved Items
Silver,start heading for it's,( HIGH).I believe on every pull0 back keep buy8.
Abbas Khan
Abbas Khan Mar 23, 2021 12:20PM ET
Saved. See Saved Items.
This comment has already been saved in your Saved Items
hi krishnan sir in Powell testifies what u expected and your opinion about gold up trend possible
Barani Krishnan
Barani Krishnan Mar 23, 2021 12:20PM ET
Saved. See Saved Items.
This comment has already been saved in your Saved Items
I'm watching as I write this, Abbas :) Hard to say ... he hasn't really moved the needle on yields/dollar each time he spoke the past two months.
Abbas Khan
Abbas Khan Mar 23, 2021 12:20PM ET
Saved. See Saved Items.
This comment has already been saved in your Saved Items
Barani Krishnan thanks a lot dear krishnan sir thank u so much
SunilKumar Dixit
SunilKumarDixit Mar 23, 2021 12:20PM ET
Saved. See Saved Items.
This comment has already been saved in your Saved Items
Abbas Khan. Must be careful about 1719-1725 range.
Robert Flores
Robert Flores Mar 23, 2021 11:32AM ET
Saved. See Saved Items.
This comment has already been saved in your Saved Items
Oil, copper and most commodities are giving us a taste of infation, meanwhile a high dollar is recessionary for the globe, if trend continues we will be in a worldwide stagflation environment- I Hope the dollar breaks soon ... its for the best
Barani Krishnan
Barani Krishnan Mar 23, 2021 11:32AM ET
Saved. See Saved Items.
This comment has already been saved in your Saved Items
In an ideal world, yes, Mr Flores. If only the whales would allow markets to be. Sigh.
SunilKumar Dixit
SunilKumarDixit Mar 23, 2021 11:32AM ET
Saved. See Saved Items.
This comment has already been saved in your Saved Items
And these days whales have been on rampant violation of all resistance and support theories for their own greed.
Golden Berg
goldenberg Mar 23, 2021 10:36AM ET
Saved. See Saved Items.
This comment has already been saved in your Saved Items
COMEX deliveries very often do not actually leave the COMEX vaults. The buyer gets a warrant to the metal but it stays in the vault. There is a process to physically remove metal from the vault but CME makes it cheap to store your metal in their vaults and most buyers don't want physical delivery...at this point in time. Also the process to get your bars back into a COMEX vault is expensive (they have to verify the quality of the bars) which is a further deterrent from doing loadout. How many owners have duplicate warrants / claims to each ounce in the vault? Some say it's 100:1.
Barani Krishnan
Barani Krishnan Mar 23, 2021 10:36AM ET
Saved. See Saved Items.
This comment has already been saved in your Saved Items
Nice perspective. Goldenberg. Thanks.
SunilKumar Dixit
SunilKumarDixit Mar 23, 2021 10:36AM ET
Saved. See Saved Items.
This comment has already been saved in your Saved Items
Splendid explanation.
Allatra Yiveh
AllatraYiveh Mar 23, 2021 10:27AM ET
Saved. See Saved Items.
This comment has already been saved in your Saved Items
Spot price manipulation at its finest. Brought to you by JPM and Goldman.
Barani Krishnan
Barani Krishnan Mar 23, 2021 10:27AM ET
Saved. See Saved Items.
This comment has already been saved in your Saved Items
Yes, unfortunately.
chris hauck
DropnsumNYC Mar 23, 2021 9:36AM ET
Saved. See Saved Items.
This comment has already been saved in your Saved Items
Never mind the silver shortage, the Perth Mint basically defaulting, or the outrageous premiums being paid for physical over spot.  Supply and demand mean NOTHING in the silver market.  It's all about the dollar.  SMH
Barani Krishnan
Barani Krishnan Mar 23, 2021 9:36AM ET
Saved. See Saved Items.
This comment has already been saved in your Saved Items
DropnsumNYC: Thanks for the backing perspective. Bests.
SunilKumar Dixit
SunilKumarDixit Mar 23, 2021 9:36AM ET
Saved. See Saved Items.
This comment has already been saved in your Saved Items
Chris. That's reason why gold to silver ratio is a game changer...
Don Burris
Don Burris Mar 23, 2021 8:30AM ET
Saved. See Saved Items.
This comment has already been saved in your Saved Items
spot price means nothing. Market price and spot have decoupled long ago.
SunilKumar Dixit
SunilKumarDixit Mar 23, 2021 8:30AM ET
Saved. See Saved Items.
This comment has already been saved in your Saved Items
Don Burris. As per industry established practices which are indisputable, spot prices represent the real time value. Futures are on discount in bear trend and premium sets in when prices are on uptrend. This is normal.
Barani Krishnan
Barani Krishnan Mar 23, 2021 8:30AM ET
Saved. See Saved Items.
This comment has already been saved in your Saved Items
SunilKumar Dixit  Thanks for clarifying that.
Tobias Schrøder
Tobias Schrøder Mar 23, 2021 8:00AM ET
Saved. See Saved Items.
This comment has already been saved in your Saved Items
I think its possible to see both USD and Gold go up simultaniusly in a near future
Barani Krishnan
Barani Krishnan Mar 23, 2021 8:00AM ET
Saved. See Saved Items.
This comment has already been saved in your Saved Items
Hello Tobias, that's not impossible, and it has happened before, though the dollar is wielding too much influence now.
Nicolas Berdyaeff
Nicolas Berdyaeff Mar 23, 2021 5:30AM ET
Saved. See Saved Items.
This comment has already been saved in your Saved Items
Yes yes. Next week it will be written....bulls are on the desk. When everybody around is writing about bearish bearish....strong bull movement is expected. You"d better write it end of february when it was 28.3 not now
Barani Krishnan
Barani Krishnan Mar 23, 2021 5:30AM ET
Saved. See Saved Items.
This comment has already been saved in your Saved Items
We're in tough, range-bound trading times for the top two precious metals. Hope the $26 and $1,750 ceilings crack for both.
Bradly Bundrant
Bradly Bundrant Mar 23, 2021 4:30AM ET
Saved. See Saved Items.
This comment has already been saved in your Saved Items
Terrific analysis! Filled with useful facts, timely and highly educational, I will keep in Notes to refer to for some time to come. West Texan
Barani Krishnan
Barani Krishnan Mar 23, 2021 4:30AM ET
Saved. See Saved Items.
This comment has already been saved in your Saved Items
Thanks much, BB, truly appreciate.
 
Are you sure you want to delete this chart?
 
Post
 
Replace the attached chart with a new chart ?
1000
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Add Chart to Comment
Confirm Block

Are you sure you want to block %USER_NAME%?

By doing so, you and %USER_NAME% will not be able to see any of each other's Investing.com's posts.

%USER_NAME% was successfully added to your Block List

Since you’ve just unblocked this person, you must wait 48 hours before renewing the block.

Report this comment

I feel that this comment is:

Comment flagged

Thank You!

Your report has been sent to our moderators for review
Disclaimer: Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. All CFDs (stocks, indexes, futures) and Forex prices are not provided by exchanges but rather by market makers, and so prices may not be accurate and may differ from the actual market price, meaning prices are indicative and not appropriate for trading purposes. Therefore Fusion Media doesn`t bear any responsibility for any trading losses you might incur as a result of using this data.

Fusion Media or anyone involved with Fusion Media will not accept any liability for loss or damage as a result of reliance on the information including data, quotes, charts and buy/sell signals contained within this website. Please be fully informed regarding the risks and costs associated with trading the financial markets, it is one of the riskiest investment forms possible.
Continue with Google
or
Sign up with Email