The September silver contract closed at $19.20 on 8 July, above the range where the white metal had been trading from lows around $17.50 to highs around $19.00, which could represent a breakout for the precious metal, per Charles Schwab.
Key quotes
“The positive move in silver could be explained by its safe-haven status, similar to gold it is expected to perform well in times of uncertainty. Recent events in the South China Sea regarding land claims by China and recent sanctions imposed by both countries could add to a move to safe-haven assets. The increase in COVID-19 cases poses further uncertainty for the equity markets.”
“The current silver-to-gold ratio stands at approximately 92, near its multi-decade high of approximately 110, and well above the low end of the historic range. Any lessening of the ratio would be bullish for silver.”
“The 14 day RSI momentum indicator at 70.37 indicates strong momentum but also signals a potential overbought condition for silver.”
“Looking at the daily chart for SIU20, the price is above the previous resistance of 18.65, moving forward this price level should act as support. Additional support can be identified at that level, with the 20 day SMA at 18.55 and trend line support also lining up at the same price level.”
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