Silver continues to be a moving target for traders, as we are looking at this via the interest rate situation, as higher rates continue to cause issues for silver.
Silver has fallen rather hard during the trading session on Monday, losing almost 5% as interest rates in the United States continue to skyrocket.
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All things being equal, the market is likely to continue to see a lot of questions as traders look at this through the prism of perhaps testing the $60 level.
The $60 level is a large, round, psychologically significant figure
The $60 level is a large, round, psychologically significant figure and an area that a lot of people will be watching. If we were to break down below the $60 level, it opens up the possibility of a move to the $56 level.
The market bouncing from here would make a certain amount of sense from a technical analysis standpoint, but with that being said, it is likely that interest rates could be a determining factor. If we test the $60 level and see interest rates drop in the United States, that opens up the possibility of some type of short-term buying opportunity.
The market is likely to continue to be very noisy, and do keep in mind that the silver market is highly sensitive to rates, especially as it is a non-yielding asset. It is much more sensitive to interest rates than gold.
That being said, longer term, I do like the idea of owning silver, and I am waiting to see whether or not I get an opportunity to buy and hold silver because there is a strong amount of demand out there and not nearly enough supply. That will continue to be the case, but right now we are looking at a situation where traders are trying to figure out where we are going next.
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