Earlier, we noted that gold had held its own above a key support level and that it may be on the verge of a comeback given the recent falls in bond yields and the Fed’s U-turn on interest rates. But it the other major precious metal which looks even more appealing from a technical standpoint: Silver’s dip yesterday to take out the prior lows around $15.00 was quickly rejected and the metal closed back above this key long-term support level. The resulting price action has left behind a long-legged doji/hammer candlestick pattern on the daily chart. So, not only do we have a bullish-looking daily price candle near a key support level, but we also have a potential reversal pattern in the form of a false break. That’s not to mention the fact that all of this has happened around the 200-day moving average. Given these technical considerations alone, we think that silver could be about to stage a meaningful rally. It has already shown some further bullish follow-through above yesterday’s range, which confirms that the bulls may have stepped back in. A break above the most recent high at $15.20/22 area could trigger further follow-up technical buying. That being said, any closing break back below the $15 level would invalidate our bullish view.

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DISCLAIMER: The information and opinions in this report are for general information use only and are not intended as an offer or solicitation with respect to the purchase of sale of any currency. All opinions and information contained in this report are subject to change without notice. This report has been prepared without regard to the specific investment objectives, financial situation and needs of any particular recipient. While the information contained herein was obtained from sources believed to be reliable, author does not guarantee its accuracy or completeness, nor does author assume any liability for any direct, indirect or consequential loss that may result from the reliance by any person upon any such information or opinions.

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