Silver is testing the 100m EMA

2020年1月21日

The title and a basic moving average strategy covers most of what we need to understand. I have taken out osome of the intermediate longer term moving averages (the 200, 300, 400) to focus on what I think are the higher probability scenarios.

I clearly think silver is in a descending triangle. If the 100 EMA holds as support and we travel sideways out of the triangle or continue upward then this chart and scenario is negated. The 500 and 600 EMAs are potential targets and at this point it would be anybody guess as to which will be the final resting place. I'll be looking for high volume when price action meets one of the EMAS/SMAs before I get comfortable. The easiest reversal of all time to grade would be if the price action hits one of these EMAS right as they hit the rising purple support line.

If the 100 EMA falls as support I see a multi-year period where the 20 EMA/SMA will act as resistance which sets up general repeat of the black oval showing price action from around 1987 to 1993. There may be a break out attempt above the 100 EMA as buyer continue to exhaust themselves as price action thrashes around the 20EMA/SMA/Bollinger band baseline but over the course of a year or so the 20 will become resistance.

Conclusion
You won't have to worry about missing out on this trade if I am right. Once the 20 EMA asserts itself as resistance you will have many chances to short this over the next couple of years. I am going to be in in short silver ETFS for the next couple of years, at least. I'll take profit at the bollinger band lower limit and look to reshort the 20 or top of the bollinger band. You can trade as you see fit; this isn't financial advise.