Silver on the verge of a breakout?
The precious metals complex received a nice boost off the weaker than expected Jolts and consumer confidence on Tuesday, and we have ADP coming on Wednesday that is expected to come in at 195,000. We are expecting this number will be a strong catalyst for the market, and if we can see a number higher than expected, we could see the market take a big hit to the downside for the precious metals and specifically the silver market.
On the technical side, silver carved out a nice bottom in the middle of august, and we are now trading out above a key pivot level of resistance of 24.70-24.77. Price action out above here keeps the bulls in control, and they need to defend that level which will now act as strong support moving forward.
Looking at the chart, there is strong trendline resistance from the highs back in May of this year. If we can see a good ADP number, Silver could take out this trendline and look to take out the 25.28 level, and then the next level would be 25.80-25.82.
We are getting close to overbought territory on this December contract for silver, and we typically see some selling pressure when the RSI gets near that 70 level, so there is great volatility to be expected this week with the strong technical points and the fundamental backdrop.
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.
On the technical side, silver carved out a nice bottom in the middle of august, and we are now trading out above a key pivot level of resistance of 24.70-24.77. Price action out above here keeps the bulls in control, and they need to defend that level which will now act as strong support moving forward.
Looking at the chart, there is strong trendline resistance from the highs back in May of this year. If we can see a good ADP number, Silver could take out this trendline and look to take out the 25.28 level, and then the next level would be 25.80-25.82.
We are getting close to overbought territory on this December contract for silver, and we typically see some selling pressure when the RSI gets near that 70 level, so there is great volatility to be expected this week with the strong technical points and the fundamental backdrop.
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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