Silver markets have shown bullish pressure to the upside, breaking above the top of the hammer from the previous session. Silver is highly likely to go looking towards the $18 level next, and then eventually the $18.50 level. Breaking above there it opens up the door towards the $19 level. To the downside, the 50 day EMA offers support, just as the 200 day EMA well.
In other words, I think that dips will continue to attract buyers, especially as the Federal Reserve continues to throw money at anything that moves. Over the longer term, this should devalue the US dollar, but even if it does not there is also the “safety trade” when it comes to the precious metals sector.
I think that we will continue to see a lot of choppy behavior, so I believe it is easy to look towards the dips as short-term buying opportunities, and I will approach the market as such.
I do not necessarily think that the market is going to simply break to the upside, so although I am bullish of silver I think at this point it is likely that we will see a lot of choppiness in the meantime, so with that being the case you need to be a bit cautious and perhaps even keep your position size somewhat small.
Nonetheless, I believe that the market continues to see a lot of buying pressure overall, so I have no interest whatsoever in shorting this market as the fundamentals line up for silver going higher. Yes, I also believe that it will lag the gold market, but at the end of the day I think that silver is a winner.