Silver has caught my eye this week as price action shapes up in a weekly chart congestion pattern and it could be worth watching for any new momentum-based trend line breakout. Traders also need to keep an eye on the US$ index, however, as it is shaping up in a bullish-reversal chart pattern that, if it evolves, could undermine any recovery efforts for Silver and other commodities. In this post I review the charts of Silver, a Silver ETF and a Silver stock.
Silver monthly: price action was essentially in a down trend from 2011 to earlier this year. The print of lower Highs and lower Lows ceased once price printed back above the $20 level. The $30 level now seems to be the resistance zone to navigate:
Silver weekly: the most recent weekly candle was an indecision-style Spinning Top as price action shapes up in a congestion triangle of sorts. This is giving the weekly chart a bit of a Bull Flag appearance and note how bullish momentum is trending higher.
- Any bearish trend line breakdown would bring the $19 level into focus as this is a recent reaction zone and near the weekly 61.8% Fibonacci.
- Any bullish trend line breakout would bring the recent High, near $30, into focus.
Silver weekly + Ichimoku: price action is above the weekly Cloud but note how volume has been on the decline. Watch for any volume breakout to help confirm any price action breakout:
Silver daily: the daily chart shows that momentum has been fairly flat for much of the last 3 months but has just started to edge higher:
Silver daily + Fibonacci: the $22 level is a support level to monitor for any bearish breakout as well as the $19 region:
Silver 4hr: price action is above the 4hr Cloud but momentum is currently declining and is below the 20 threshold level. Watch for any momentum-based trend line breakout:
US$ Index
DXY weekly: the US$ index closed the week with a bullish-reversal Inverted Hammer candle and is still shaping up in a bullish-reversal Descending Wedge. Silver and commodity traders should keep an eye on the US$ index as any bullish recovery here would put pressure on Silver and commodities:
Silver ETFs and stocks
- Silver ETF, SLV
SLV weekly: the Silver ETF, SLV, is shaping up similarly to the base metal:
- Any bearish breakdown would bring the $17 level into focus as this is a recent reaction zone and near the weekly 61.8% Fibonacci.
- Any bullish breakout would bring the recent High, near $27, into focus.
SLV weekly + Ichimoku: as with the base metal, price action is above the weekly Cloud but note how volume has been on the decline. Watch for any volume breakout to help confirm any price action breakout:
- First Majestic Silver: AG
AG weekly: watch First majestic Silver, AG, for any ADX move above 20 to confirm either a bullish or bearish trend line breakout:
AG weekly + Ichimoku: keep an eye on volume as well and watch for any volume breakout to help confirm any price action breakout:
Final comments:
Silver is shaping up in a congestion triangle pattern but bullish momentum is building on the weekly time frame. Traders should watch for any trend line breakout that is supported by any uptick with momentum and volume.