Silver: Bulls are driving the car and heading for long drive

Overview: From the past couple of weeks we are witnessing that bulls are leading in the silver and taking it to the northside. Presently silver is trading at multi year’s high of 26.80 level which is the fresh high since April 2013. Overall it is trading and sustaining above all the major and minor moving average lines.

Technical Analysis: From a long term perspective we can see that on a monthly chart pair has given us bullish breakout of the pure consolidation i.e. range bound territory of last few years. From a technical perspective, we can see that a valid breakout of previous swing’s high on the weekly chart which is a sign of bullishness. A short term uptrend line still remains intact so we will keep our view bullish and buy on dips is advised. Well, the present picture depicts that the bulls are driving the car and they are heading for a long drive so traders and investors are advised to sit in the car and have a long position, however, silver is rising up from 11.23 level to 26.80 level continuously so some correction can’t be ruled out but this correction should be taken as buying opportunity.

Odds are in favor of bulls and intraday to weekly bias remains bullish on the pair as long as 23.00 level remains intact on a closing basis. The parabolic SAR green dots are favoring the bulls and a bullish crossover on the MACD indicator is also favoring the bulls. RSI has arrived into overbought so some correction is also expected.

What Next: The 23 is immediate support level followed by 20.00 level whereas 28.20 level is immediate resistance level followed by 30.00.

Trade idea: Based on chart and studies above we would suggest to our traders and investors that buy silver at 26.50-60 level target is 28.20 and 30.00 level with the tight stop loss of 23.00 level on closing basis.