Silver Forecast: Silver Continues to See Overhead Pressures

• In my daily analysis of commodities, the silver market has shown itself to be depressed, due to the fact that the interest rates in America continue to be very strong.
• This will more likely than not result in traders being a little bit hesitant to continue the hesitation in the silver market as it is extraordinarily sensitive to interest rates.
• Recently, we have seen the 10 year yield pop higher, reaching 4.6% in the United States, which is toxic for silver as it simply easier to hold bonds with a juicy yield than it is to be bothered hoarding silver.

Furthermore, you also have to think that if interest rates in America are going to stay somewhat strong, that works against business, and of course silver is a highly sought after industrial metal that people will be looking at. The market currently sees quite a bit of resistance just above, and the technical analysis does look quite a bit more dire in the silver market than it does the gold market, which is typically the case when you are starting to see problems.

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Technical Analysis

The technical analysis for the silver market is rather dire, but we are hanging around the 200 Day EMA, so that does of course suggests that there could be buyers in this general vicinity. If we were to break down below here, then the $28.75 level is an area I’d be paying attention to as it offers a little bit of support previously. In that environment, we could have a situation where traders are looking to pick up some value, but if we blow through that level, I don’t really see what keeps silver from dropping down to the $27 region.

On the upside, if we were to break above the $30.33 level, at that point I might be convinced that we will probably go higher, and perhaps try to take out the 50 Day EMA. The biggest problem with a move to the upside is that it would have to be done with very little liquidity, so I would be a bit hesitant to put a lot of money into that trade.

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