What Is the Silver Market Price Telling Us Now?

Precious metals investors are once again excited about silver as the price has shot up 10% in the past month.  Not only has silver experienced some nice gains in July, but it has also broken out above its multi-year Symmetrical Triangle Formation.  But, what is the current silver market price action telling us about where the shiny metal goes from here?  While we have seen some nice daily moves in the silver price, it seems to be peaking around that $16.60 area for the past week.  Currently, the silver price is trading at $16.62 at midday.

Furthermore, the silver price has outperformed gold, pulling the Gold-Silver Ratio down from 95/1 at the beginning of July to 85/1 today. Which means, in just a few short weeks, one ounce of gold can now only buy 85 ounces of silver compared to 95 oz two weeks ago.  Talk about a significant change in the Gold-Silver Ratio in a relatively short period of time.

So, where does the silver price go from here??  Good question.  Well, if we look at the following Long-Term Monthly chart of silver, we can see that it has broken out of the Symmetrical Triangle Formation. It has also moved nicely above the 50 Month Moving Average (MMA – BLUE LINE) at $16.23:

Each candlestick in the chart above represents one month’s worth of trading.  As we can see, the silver price has surpassed the 50 MMA and is attempting to reach the next important key level, the 200 MMA (RED LINE) at $16.76.  I would bet that the silver price will at LEAST touch that $16.76 level, or go possibly higher before any correction takes place.  Why?  Because, it wouldn’t be unusual for silver to pause for a moment and correct back down to the $15.50 before going higher.

However, that $15.50 Level is critical for the silver price for it to remain in a Bullish Trend because that is the top of the Symmetrical Triangle Formation line. I have seen this day in a day out in the markets.   A large percentage of stocks will go back and test (touch) the breakout area before moving higher.  Of course, it’s not a guarantee that this will occur. Especially how crazy the markets have become with the Fed possibly cutting rates next week, but we shouldn’t view it as unfavorable if it does happen.

Now, if we look at the Daily Silver Chart, the $15.50 level is also a key support area:

Please understand, I am NOT SAYING the silver price will go back down to the $15.50 level, but if it did, it wouldn’t be unusual for traders.  That being said, the $16.20 level is also another SUPPORT-RESISTANCE LEVEL.  From Feb-Jun 2018, $16.20 was a support level, but once it fell below that, it became a resistance level.  We can see this in the silver price action Jan-Feb 2019.  The silver price touched it twice but did not go above it.  Furthermore, the Daily chart RSI (top of the chart) shows that silver is overbought.  But again, it could go even higher.

So, you see, these TECHNICAL LEVELS are important guidelines for traders, hedge funds, investors, and institutions.  And, it is no coincidence that the $15.50 level in the Daily Chart was also a Key Level in the Monthly Chart via the Symmetrical Triangle Formation:

As I have stated several times, a BREAKOUT occurs when the price finally pushes through a critical resistance level in a big way.  So, when silver broke out of the upper Symmetrical Triangle Line in the monthly chart, it also broke above the very same $15.50 resistance level on the daily chart. However, BREAKOUTS tend to be more impressive when they do so from longer-term chart formations.

It will be interesting to see how the silver price performs over the next 7-10 days, before and after the Fed FOMC meeting on July 30-31st.  If the Fed announces a 50 basis point rate cut during the FOMC meeting, we could see the silver price breakout significantly above the 200 MMA of $16.76.  That is if the price remains close to this level for the next week.

There is a lot more I will be explaining about the Silver Price in my upcoming Youtube video this weekend.  If you haven’t subscribed to my SRSrocco Report Youtube Channel, please do so at the link below.

If you are new to the SRSrocco Report, please consider subscribing to my:  SRSrocco Report Youtube Channel.

HOW TO SUPPORT THE SRSROCCO REPORT SITE:

I would also like to thank those foundation supporters, who have chosen to become a member by making donations through PayPal to further the research and publishing work at the SRSrocco Report.

So please consider supporting my work on Patron by clicking the image below:

Or you can go to my new Membership page by clicking the image below:

Check back for new articles and updates at the SRSrocco Report.  You can also follow us on Twitter, Facebook, and Youtube below:

Enter your email address to receive updates each time we publish new content.

I hope that you find SRSroccoReport.com useful. Please, consider contributing to help the site remain public. All donations are processed 100% securely by PayPal. Thank you, Steve

newest oldest most voted
Notify of
Cobah.
Guest
Cobah.

Was truly flabbergasted by the dwindling silver production at Fresnillo mine. The mine was previously known as The Proaño mine.The former owners were Americans and sold the mine to Industrias Peñoles (parent company of Frenillo plc).The price was very inexpensive and it become the premier silver mine of Mexico. This are current production results. The total silver production for 1H was only 6,407 kg or 205,024 ounces of silver with a price tag of only 3,276,000 US Dollars.The decline was 21.2% for the 1 semester. Is obvious that the mine is a money losing operation,maybe a white eleplant.the only mitigating… Read more »

DisappearingCulture
Guest
DisappearingCulture

“It will be interesting to see how the silver price performs over the next 7-10 days, before and after the Fed FOMC meeting on July 30-31st.”

And how the COT sets up in the near future, and what happens as a result of that.

OutLookingIn
Guest
OutLookingIn

DC-

“It will be interesting…”
The COT numbers since Monday:
Total open interest (shorts) –
Monday 231,163 contracts
Tuesday 233,192 contracts
Today, Wednesday 234,975 contracts
Thats 3,812 contracts added in the last three days. One contract is 5,000 ounces.
They keep throwing paper silver at the market, in an attempt to shake the resolve of the longs into giving up. No such luck. These long holders are resolute and will stand for delivery.

DisappearingCulture
Guest
DisappearingCulture

“…and will stand for delivery?
Probably cash delivery.
But as long as they don’t capitulate…

Geedard
Guest
Geedard

Hi Steve, great observations.

Mike Maloney has also spoken of unusual silver pricing action for the last 2 weeks… see this weeks video and also last weeks too…

https://youtu.be/X1EnxOwXC7E

https://youtu.be/SkqdNa6mHy0

Interesting points and data sources. Cheers for now and continue your great insights.

4 oz
Guest
4 oz

Yeah Steve, it’s funny how I totally believe Silver priced under $36 is an absolute steal.
Yet somehow, it really irks me that very soon I may have to part with $20 an ounce….

Carl Richardson
Guest
Carl Richardson

The silver chart recently completed two bull flags on the way up . This is very bullish and looks like silver will continue up for now .

DisappearingCulture
Guest
DisappearingCulture

That depends on what can be done with the increasing number of shorts on the COT. That’s just the fact of the matter. And with “the Fed FOMC meeting on July 30-31st” that has always been a time for shorts to flex their muscle.
In a previous blog Steve has mentioned where [his take based on technical analysis] silver has to close on 7/31. If it closes below that [and he is correct], the price may languish.

OutLookingIn
Guest
OutLookingIn

DC –

Speaking of increasing number of shorts –
Another 1,530 paper contracts were added this morning, bringing the total up until now to 236,505 paper short contracts. One must remember that the size of one contract is 5,000 ounces of silver. The total number of paper silver ounces, is now approaching 12 million ounces!
Do you really think the primary market movers, Comex, LBMA, have that amount of physical silver sitting in vaults? Not likely and most probably not. So its now up to who will flinch first. The shorts? Or the longs?

OutLookingIn
Guest
OutLookingIn

In short comparison, how’s gold doing?

Currently on the Comex, open interest (shorts) on gold, is near the record high set on July 11th 2016 at 657,776 contracts.

DisappearingCulture
Guest
DisappearingCulture

https://www.youtube.com/watch?time_continue=2&v=eOt4XH7clOQ

I’ve only gotten part the way through this, but this topic [shorts & gold] are covered.

Steve
Guest

“silver price seems to be peaking around that $16.60 area for the past week”

Silver made an all time high for this run just yesterday
Today was option expiry on the comex so of course suppression was in overdrive
Monday we could go up 25 cents or more and continue to explode upwards
My chart is showing 11 of the last 14 candles have been green with many large candles whereas the 3 red ones were moderate
Buy on weakness, scale out into the rallies
Hold all core positions
The Fed is reversing course and this Bull has not even began to run

DisappearingCulture
Guest
DisappearingCulture

“The Fed is reversing course and this Bull has not even began to run”
The bull may stop to graze or relieve itself.