After a sharp correction, silver initially turned upwards at the end of June.
After a sharp correction, silver initially turned upwards at the end of June. The precious metal was able to set important accents, but silver was denied the actual liberation. Has the chance already passed?
Review. In our last comment on silver from 27.06. it said, among other things „[…] Silver was initially able to break away from the US$23 and then attacked the resistance area around US$24.4. A sustained breakout above this resistance zone would have provided the precious metal with further upside potential in the direction of US$ 25 or even in the direction of US$ 26+ (former double top). But that didn’t happen, because at the decisive moment silver gave up and it went down again. The setback immediately developed veritable downward momentum. The $23 was broken again. An extension of the pullback toward $22 was imminent. However, silver has turned back up and is currently grappling with $23 again. in short. The past few days of trading have shown that given the current mix, the metal’s upside potential appears to be limited to the $24.4 area. Stronger impulses are needed from the fundamental side. A bout of weakness in the greenback would be one. However, the US dollar is currently characterized by its robustness. In this respect, the situation for silver will remain tense and a challenge for the time being.”
The chart picture has brightened up significantly over the past few days and weeks, although the precious metal has not managed to break through the correction scenario.
The break of the downtrend (shown in red) as well as the recapture of the all-important zone around $24.0/$24.4 provided some easing. However, a look at the chart makes it clear that the real challenge – the double top area around $26 – has not been seriously tackled. And so it came as it had to come. The advance faltered.
Meanwhile, silver has retreated to the $24.4/$24.0 zone. This threatens to fail the recovery. A pullback below $24 would be interpreted as a warning signal. At the same time, in this case, there would be a threat of an expansion of the movement in the direction of US$ 23 or even US$ 22.
in short. Recovery is at a crossroads. The recent setback is putting a lot of pressure on the recovery scenario. A break of $24 would probably finally pull the plug on the recovery. Looking to the upside, silver needs to clear the resistance areas around $25 and especially $26 (double top).