Silver 1 OZ 999 NY (XAG=X) Markets extraordinarily negative
Silver markets were extraordinarily negative during the trading session on Thursday and sliced through the $16.00 level. By doing so, the market shows just how weak it is, because the area had been so supportive in the past. Looking at the size of this candlestick, it’s obvious that there is a lot of negativity there, and a breakdown below this candlestick would send this market down towards the $15.50 level.
Any rally at this point will certainly look at the $16.50 level as significant attempt to break above there as bullish if it does in fact happen but at this point, I don’t anticipate it being very easy to do. After all, silver has a certain industrial component to it, and it should be noted that the US dollar strengthened considerably during the day. This shows that metals are going to be on the back foot not only due to a strengthening dollar but perhaps a lack of inflation.
Going back to the industrial part of silver, it’s obvious that we don’t have much in the way of demand at the moment, as the market is obviously focusing on the fact that industry is running very slow in this environment. If that’s going to be the case, silver is going to continue to be very sluggish and not needed. After all, although there is a precious metal aspect to the market, the reality is that the silver markets tend underperform gold, which of course is getting crushed during the session as well. At this point, fading rallies continues to work as silver is ready to rollover yet again.
Overall, the bias in prices is: Downwards.
Note: this chart shows extraordinary price action to the downside.
By the way, prices are vulnerable to a correction towards 17.50.
The projected upper bound is: 16.56.
The projected lower bound is: 14.74.
The projected closing price is: 15.65.
A big black candle occurred. This is bearish, as prices closed significantly lower than they opened. If the candle appears when prices are “high,” it may be the first sign of a top. If it occurs when prices are confronting an overhead resistance area (e.g., a moving average, trendline, or price resistance level), the long black candle adds credibility to the resistance. Similarly, if the candle appears as prices break below a support area, the long black candle confirms the failure of the support area.
During the past 10 bars, there have been 4 white candles and 6 black candles for a net of 2 black candles. During the past 50 bars, there have been 26 white candles and 24 black candles for a net of 2 white candles.
Three black candles occurred in the last three days. Although these candles were not big enough to create three black crows, the steady downward pattern is bearish.
Momentum is a general term used to describe the speed at which prices move over a given time period. Generally, changes in momentum tend to lead to changes in prices. This expert shows the current values of four popular momentum indicators.
One method of interpreting the Stochastic Oscillator is looking for overbought areas (above 80) and oversold areas (below 20). The Stochastic Oscillator is 18.4892. This is an oversold reading. However, a signal is not generated until the Oscillator crosses above 20 The last signal was a buy 7 period(s) ago.
Relative Strength Index (RSI)
The RSI shows overbought (above 70) and oversold (below 30) areas. The current value of the RSI is 26.85. This is where it usually bottoms. The RSI usually forms tops and bottoms before the underlying security. A buy or sell signal is generated when the RSI moves out of an overbought/oversold area. The last signal was a sell 46 period(s) ago.
Commodity Channel Index (CCI)
The CCI shows overbought (above 100) and oversold (below -100) areas. The current value of the CCI is -168.This is an oversold reading. However, a signal isn’t generated until the indicator crosses above -100. The last signal was a buy 6 period(s) ago.
The Moving Average Convergence/Divergence indicator (MACD) gives signals when it crosses its 9 period signal line. The last signal was a sell 10 period(s) ago.
Rex Takasugi – TD Profile
PREC.M.XAG= closed down -1.056 at 15.697. Volume was 8,900% above average (trending) and Bollinger Bands were 130% wider than normal.
Open High Low Close Volume___
16.730 16.911 15.480 15.697 42,403
Short Term: Oversold
Intermediate Term: Bearish
Long Term: Bearish
Moving Averages: 10-period 50-period 200-period
Close: 16.88 17.71 17.12
Volatility: 54 33 28
Volume: 4,240 848 212
Short-term traders should pay closer attention to buy/sell arrows while intermediate/long-term traders should place greater emphasis on the Bullish or Bearish trend reflected in the lower ribbon.
PREC.M.XAG= is currently 8.3% below its 200-period moving average and is in an downward trend. Volatility is extremely high when compared to the average volatility over the last 10 periods. There is a good possibility that volatility will decrease and prices will stabilize in the near term. Our volume indicators reflect very strong flows of volume out of XAG= (bearish). Our trend forecasting oscillators are currently bearish on XAG= and have had this outlook for the last 9 periods. Our momentum oscillator is currently indicating that XAG= is currently in an oversold condition.
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