SLV daily 2 Dec 1st
With the extreme price volatility over the last two trading sessions, coupled with the fact that I had received several inquires on the precious metals over the weekend, I wanted to add to the previous comments on silver. Shortly after that last update, SLV ever so slightly exceeded the 16.05 resistance/buy trigger due to the extreme momentum-fueled run-up earlier today. Brief overshoots of support & resistance are very common when the momentum is very strong leading up to a key technical level (basically, “inertia” for a stock or etf). However, prices immediately reversed from there and moved right back to the underside of the downtrend line. For those that were/are considering going long SLV, it might be preferable to wait for the next break above 16.05 (or even better, 16.10) before establishing or adding to a position if you have not done so yet.
For those already long, my take is that today’s very bullish price action (over 100% recapture of all of Friday’s big loss in SLV) tilts the near & intermediate-term outlook from SLV back to bullish following Friday’s “win” for the bearish case. Once again, with gold & silver chopping around key support/resistance levels lately & volatility ramping up, longer-term investors & more risk-adverse traders might opt to just sit aside while the bulls & bears battle it out here.
My bias for gold & silver (short, intermediate & long-term) remains bullish but I believe that solid technical case, bullish or bearish, can be made either way right now. Quick, nimble traders might take advantage of this volatility to trade the metals long and short while more aggressive swing traders or investors might opt to continue to scale into long or short, depending on their outlook for the metals. The important thing is to make sure to not become married to that position and allow losses to get out of hand, if wrong. Best of luck & don’t hesitate to contact me if you have any questions.