- Silver fell during the trading session on Thursday to show signs of negativity, but this is a market that has gotten so overbought that it does make a certain amount of sense that we would see some type of pullback.
- Ultimately, this is a market that has gotten so far ahead of itself it makes a certain amount of sense that we would drop.
- That being said, there are a couple of possibilities that I am looking forward to when it comes to this market.
A Couple of Possibilities
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Silver could do one of 2 things from what I see at this point. We could pull back and go looking for support at lower levels, which for me is actually the preferable round, because it gives traders the opportunity to pick up a bit of value at lower prices. At that point, I would anticipate that silver could find support near the $40 level. On the other hand, we could just simply go sideways. Sometimes, markets will bounce around going sideways suggesting that we are simply “killing time” in order to work off some of the excess froth from the move higher.
Friday Matters
The Friday candlestick will matter, mainly due to the fact that the Non-Farm Payroll announcement comes out, and that will have a major influence on interest rates, as well as the US dollar. This is a major influence on what happens in silver, and I think ultimately, we will perhaps see some type of volatility during the Friday session, but perhaps we will get some type of clarity. What I’m hoping for is some type of massive knee-jerk reaction to the downside, so I can start buying again.
After all, the longer-term trend is still very bullish, and we are at the top of a major uptrend in general. A little bit of a pullback from here would make a lot of sense, and wouldn’t change much other than giving you the opportunity to pick up “cheap silver.” I have no interest in shorting the market as things stand right now.
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