RJO FuturesCast

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Metals

Unlike Equites, Silver Futures are Not Melting Down

Posted 03/23/2018 8:55AM CT | Eli Tesfaye

March silver is trading 16.600 up about 21 cents on the day.  In previous articles, I discussed how silver was putting a potential bottom. The May contract is bouncing off recent lows of 16.10. Technically, the near-term lows are in. A close above 17.00 will confirm the downtrend has come to an end. Recent headlines of potential “trade war” with China is giving flight to safety type of support to the metals in general. As also mentioned previously, longs should come on strength rather than pick a bottom. I think the recent strength in silver is a catalyst for higher price action. “with punch and counterpunch moves” of US and China, silver is getting an opportunity to shine once again. 

Bulls should be encouraged that silver is not melting down with equities, and “dips” would be seen as an opportunity to buy rather than sell. Remember silver has been in consolidation for a very long time as the chart below shows. Breakout outside the specified range should be material in my view. Proper money management is key to trading successfully along with sound strategy. I would be happy to talk to you about trading ideas in the silver market. Fed and China are fueling the rally in recent days. One must exercise caution as bullish headlines have a way of fading into the background. As I have stated, trade outside of these ranges will probably cause silver to make a substantial move.

Silver Monthly Chart

silver_monthly_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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