Below are the up close daily chart of silver and also a dialed out daily chart to give perspective on the now bullish short-term technical situation.
Silver has clear support at the lateral support area that is in confluence with the 200 day moving average. In other words, key support is at 23.50 (+/-). It can poke below or hold above that level, but that is the key area to hold, especially on a weekly close. As you can see, RSI shows an overbought situation now remedied.
Dialing the chart out, you can see the progress that will have been made if it holds this support level. Silver spent a year trying to establish the top of the yellow shaded base as support and after a couple of gut wrenching breakdowns (bear traps) it finally did that.
Bottom Line
Silver is set up to launch after this refueling stop.
Silver bulls do not want to see another test of lower support at 22.20. I would think that many traders see the support at the SMA 200 and that is precisely the reason I don’t want to see it violated. If there is mass disappointment with a loss of that area, well, you know about silver’s volatility.
Silver is set up technically and seasonally. Now it needs to do the normal thing by TA standards and hold support at the SMA 200. If it does a target of 29 to 30 would be a reasonable near-term objective.
