Silver Rallying Sharply; Watch out for Key Resistance Around 20

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Silver Rallying Sharply; Watch out for Resistance Around 20

Silver has been rallying since forming a price bottom around 18.70, which was in a multi-year support area. The 6/12 price action was strong but we should start watching out for resistance as price approaches the 20 handle.
silver 6/12 daily chart

As you can see in the daily chart, just under 20, we have some common resistance that we saw in April and May. Price will also be challenged by a falling trendline that came down from the year’s high near 22. If you see price settle under 20, expect a bearish attempt .The prevailing trend in the daily chart is bearish in 2013 before the February bullish correction.

The 4H chart shows today’s strong rally off a trendlien that has been developing since early May.Although there is a bullish swing developing, note that the moving averages reflect bearish market. Thus as price moves further above these moving averages, there is increased chance of a reversion back towards the moving averages. Thus if we start to see price stalling, and maybe a bearish divergence with the RSI, expect a bearish attempt.
silver 4h chart 6/12

To contact the reporter of this story, email Fan Yang at fan@forexminute.com
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Fan Yang has been a professional forex trader and analyst since 2007. He specializes in technical analysis and has a Chartered Market Technician designation since 2011. He was the chief technical strategist at CMSFX He was also the founder and chief currency strategist at FXTimes Over the years, Fan has not only been a trader and analyst but also an educator. As a proponent of both technical and fundamental analysis in trading, Fan advocates simplicity and discipline as key factors in making trading decisions when faced with so many "clues" and "signals". Currently Fan Yang is the chief currency analyst and webinar instructor at forexminute.com.