Progress Halts after Reaching Last Week’s High
The resistance around the prior swing high of 24.61 from December 22 halted the progress last week. This price level was identified earlier as a potential target due to its historical significance as a resistance point. The key question now is whether silver will continue its upward trend or if a retracement is likely. The possibility of a pullback has increased following the price action seen last week.
However, if silver manages to decisively rally above last week’s high of 24.64, it could potentially reach a higher target before any retracement occurs. The next target to watch for is around 24.81, where a rising ABCD pattern (magenta) completes a 161.8% Fibonacci extension of the pattern. This would be the third target from the pattern, with the lower levels already being surpassed on the upside.
Overall Bullish Outlook
In the broader picture, there is an initial higher target for silver around 27.15 where a larger rising ABCD pattern completes (green). Given the recent strong rally in silver, reaching this higher target seems reasonable. Traders will be on the lookout for bullish signs of reversal off retracement lows during any weakness. A drop below last Friday’s low of 24.17 would indicate a potential pullback.
The 8-Day MA is at 23.83, followed by the 38.2% Fibonacci retracement at 23.73. The last significant resistance level that was breached is at 23.50, near the 50% retracement level at 23.46. If a retracement occurs before new highs are reached, these price levels could act as support and potentially lead to a bullish reversal.
Additionally, the monthly chart shows a bullish reversal signal triggered earlier this month. The follow-through to the upside suggests strong demand and points towards higher prices in the future.
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Insight: The article highlights the key levels and patterns to watch for in the silver market, indicating possible areas of support and resistance. Traders and investors are encouraged to pay close attention to technical levels and potential reversal signals as the market dynamics continue to evolve. The bullish sentiment in the market suggests a positive outlook for silver, but it is important to monitor price action and key levels for confirmation of the trend.