Dec. Silver is trading around 24.495 as I write. Interestingly, the market was around this area when I lkast wrote about silver. A succession of rejection is keeping silver from flying higher. As you can see below, we have a decent-sized flag forming that requires sustain action to come out of these congestions.

Honestly, it is impressive that the bears have been keeping silver in check with all the headlines such as the U.S. election just a few days away, the stimulus deal, and Brexit. Given the U.S. dollar index technical improvement, silver will need a great deal of news to make gains. Flight to safety type of buying hasn’t been as present as one might expect with one of the most challenging election seasons in recent history. Maybe Silver fears deflation.

For now, I think we are looking at a wait and see the type of price action. A break below $23.30 will signal further selloff. And we need to see $25.50 or above for the bulls to assert their will. For now, everything we see shows a sideway to lower type of price action. The daily dollar chart also shows a sign of turning upwards and added downside pressure on Silver.

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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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