As you readers might be knowing, silver made a smart move upwards today. So, I thought it might be worth our time to have a look at silver.
25.60s was is the same level from where silver bottomed out even in May, making it the level to watch out for. The last move upwards was thwarted by MA(50), as was the case even in early April. The MA(50) now lies around the 28.50, so one can expect resistance there this time too. Though the move today was impressive, there was one thing missing. Any guesses?? Give yourself full marks if you answered volume. In fact, looking at the above chart, one can see that the volume pattern has been really bearish the last three months or so. Let's go back a little more in time to know about the importance of 25.60s, the level from where silver has bounced twice in the last two months.
It turns out that this is the same level from where silver had bounced even in late December. Time for some more time travel.......
It is from this very level that silver had bounced even in January 2011, the beginning of what turned out to be a record run. Another fact which is very evident from the above chart is the downtrend that silver has been in since the middle of last year.
To sum it up, 25.60s is a very crucial support for silver. But remember, more and more a support keeps on getting tested, the weaker it keeps on going. Also, MA(50) would be the immediate resistance level to watch out for.
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Take care and good luck!
