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Metals

Short Term Silver Indicators Favor Bull Camp

Posted 11/02/2017 3:31PM CT | Eli Tesfaye

As of November 2, 2017, December silver is trading at 17.125, down about 5 cents on the day with the daily low of 17.05. A pullback in the US dollar index once again is helping to stabilize silver. Silver is getting into attractive price levels with lows holding near 17.00. The 240 min chart below shows support structure is in the short term to facilitate higher price action. Momentum will probably send silver to retest 17.50 levels. A break above that will probably entice farther rally. All that said, break below 16.60 in December contract will likely put near-term lows.

Silver has been consolidating in a tighter range. The Commitment of Traders with Options report (COT) shows increasing non-commercial and non-reportable traders are steadily adding to their net long positions. No doubt that the bull camp needs a farther catalyst to drive price higher. Decent correction in equities and/or fresh geopolitical concern coming out of North Korea might drive price higher. 

Bargain hunters can ease into the long side from these levels with a tight risk. 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 17.05 should do the trick provided that near-term lows are possibly in.

 

Dec ’17 Silver 240 min Chart

Dec '17 Silver 240 min Chart

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Eli Tesfaye

Senior Market Strategist
Eli started his career in the futures and options market while he was in graduate school finishing up his MBA in 2003. Eli specializes in Automatic trading strategies and systematic options trading strategies in futures market. He has been Series 3 license holder since 2005. Eli's is an avid reader, runner, and yoga practitioner.
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