Silver Technical Bottom?

December 15, 2017 11:23AM CST

March silver is trading 16.040, up about 10 cents on the day. The aftermath of Fed rate decision, silver looks to have found a bit of a technical bottom. What I see impressing this morning is that silver is moderately strong even in light of bullish dollar price action. In a broader term, silver could benefit from a friendly tax reform that would increase demand for its industrial use.

Silver is modestly trading higher with a technical improvement from a recent 1 dollar break in price. These days the only time you hear about silver is its reference to Bitcoin (Litecoin). As in Bitcoin is to gold, litecoin is to silver. Commodity markets have lost some lust as the result of Bitcoin mania. 

The Commitment of Traders with Options report (COT) released today will probably show increasing non-commercial and non-reportable traders are adding to their net long positions from the week ending December 8, 2017, No doubt that the bull camp needs a farther catalyst to drive price higher. Decent correction in equities and fresh geopolitical concerns in hot spots around the globe could push price higher. 

Bargain hunters can ease into the long side from these levels with a tight risk. As I have stated before though, those who want to be long silver will be better served if they come in on strength rather than weakness.  That said, a close above 16.50 should signal that near-term lows are possibly in. I expect to see strength in silver in coming days. 

Silver Mar '18 240min Chart

Silver_Mar18_240min_Chart

RJO Futures | 222 South Riverside Plaza, Suite 1200 | Chicago, Illinois 60606 | United States
800.441.1616 | 312.373.5478

The risk of trading futures and options can be substantial. Each investor must consider whether this is a suitable investment. Past performance is not indicative of future results. Trading advice is based on information taken from trades and statistical services and other sources that RJO Futures believes to be reliable. We do not guarantee that such information is accurate or complete and it should not be relied upon as such. Trading advice reflects our good faith judgement at a specific time and is subject to change without notice. There is no guarantee that the advice we give will result in profitable trades.

This material has been prepared by a sales or trading employee or agent of RJO Futures and is, or is in the nature of, a solicitation. This material is not a research report prepared by RJO Futures Research Department. By accepting this communication, you agree that you are an experienced user of the futures markets, capable of making independent trading decisions, and agree that you are not, and will not, rely solely on this communication in making trading decisions.

Distribution in some jurisdictions may be prohibited or restricted by law. Persons in possession of this communication indirectly should inform themselves about and observe any such prohibition or restrictions. To the extent that you have received this communication indirectly and solicitations are prohibited in your jurisdiction with registration, the market commentary in this communication should not be considered a solicitation.