Silver Daily Technical Outlook

Oil N' Gold Team from Oil N' Gold at 10/19/09

Comex Silver (SI)

Silver's consolidation from 18.175 is still in progress and some more consolidation could still be seen. Nevertheless, short term outlook will remain bullish as long as 16.785 resistance turned support holds. Above 18.175 will bring rally resumption to 61.8% projection of 13.495 to 17.69 from 15.76 at 18.35 first and break will target 100% projection at 19.95 next. However, strong break of 16.785 will be the first signal that rise from 12.435 has completed, possibly with bearish divergence conditions in daily MACD and RSI. Focus will then be shifted to 15.76 support for confirmation.

In the bigger picture, whole medium term rise from 8.4 is still in progress and should extend further towards 19.55 resistance next. However, note that we're not seeing a clear impulsive structure from 8.4 yet and hence, we'd treat such rise as part of the long term, wide range, consolidation pattern that started at 21.44 back in Mar 08. In other words, current rise from 8.4 is expected to be limited by 19.55/21.44 resistance zone and bring at least one more medium term fall. On the downside, break of 15.76 support will be the first sign of topping. Further break of 12.435 will confirm that rise from 8.4 is finished.

Comex Silver Continuous Contract 4 Hours and Daily Charts