RJO FuturesCast

Daily Futures Market News, Commentary, & Insight

Metals

Silver Taking a Break From Technical Bounce

Posted 05/24/2019 9:44AM CT | Eli Tesfaye

July ’19 silver futures trading at 14.53 down 7 cents today. The market is soft today after a nice technical run yesterday as you can see on the chart below. The bears hold an overall technical edge, BUT downside pressure is weaning. Trade is working an “inside day” chart set up. Breakout from that could send it to 14.75 or psychological level of 14.00. The technical indicators I use continue to show divergence, please reach out to me to discuss that aspect of it. Also, the dollar is weak this morning, and silver is not getting a kick out of it.

The US/China trade talks have been less than productive, and silver hasn’t taken advantage of that; however, the market still thinks a resolution of some kind between the two economic giants will come sooner than later.  I don’t assure protracted economic “war” is suitable for either country. Stocks are poised for a rebound.

The chart below shows gold/silver ratio on the top of the range. The ratio should give silver a bit of an edge over gold at least for the near-term.  All in all, the short-term technicals are still supportive of silver. One can’t rule out a wash to 14.00. There could be an opportunity for aggressive bulls, but caution advised as the big picture and longer-term trend still appears to be bearish for now.

Silver Jul ’19 Daily Chart

Silver Jul '19 Daily Chart

 

Gold/Silver Ratio Weekly Chart

Gold/Silver Ratio Weekly 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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