Silver markets went sideways initially during the day but as soon as the jobs number came out, the silver market rallied towards the $16 level, but then broke down significantly as it appears that the Federal Reserve will have to raise interest rates rather soon. That of course works against the value of precious metals, and I think we are going to continue to grind down to the $15.50 level, and then eventually to the $15 level underneath. That’s an area that has a significant amount of psychological support, and if we can stay above there might be some type of hope, but I think we will eventually break down. I like selling short-term rallies, as the interest rates going higher will work against not only Silver but gold as well.
Gold markets look horrible, so do Silver
I believe that the Silver markets are simply going to mimic what happens in the gold markets, although they may be a little bit stronger due to the fact that there is a certain amount of industrial need when it comes to silver, but in the end most traders look at it as an interest rate play, and interest rates are going higher, which has an inverse correlation to the precious metals sector. As we continue to grind lower, once we break below the $15 level, we should then go to the $14 level, the $13 level, and so on. This market continues to be very volatile, and more importantly, very negative. The 24-hour exponential moving average continues to offer resistance as well, so therefore I am paying attention to that indicator also. I do not have a scenario in which a willing to buy silver, unless of course some type of geopolitical issue flares up.
SILVER Video 10.7.17
This article was originally posted on FX Empire