Silver Price Analysis: Silver is now probably in an uptrend

Silver price has probably reversed its short-term downtrend and begun a new uptrend.
It has broken above the May 7 highs – a key sign the short-term trend has reversed.
The possibility now exists for the precious metal to rise back up towards the $30.00 mark.

Joaquin Monfort FXStreet

Silver (XAG/USD) price might well have changed trend in the short-term after breaking above the key May 7 highs at $27.51.

The change of trend is significant because of the old saying that “the trend is your friend” – the environment now probably favors longs over shorts.

4-hour Chart

Silver has risen strongly since bottoming at the beginning of May. It has broken above the last higher low of the downtrend and breached all the major moving averages – the 50, 100 and 200 Simple Moving Averages (SMA). Bullish momentum has been strong during the up move. The sequence of higher highs and higher lows – of peaks and troughs – is now also rising rather than falling.

The break above the May 7 highs now signals the likelihood of a continuation higher. The first upside target lies at $27.74, and this has almost been met. The next target after that lies at around $28.80 where the consolidation that formed the multiple Head and Shoulders price pattern in the first half of April is concentrated. Beyond that there is the possibility of a retest of the $30.00 long-term range highs.

Author

Joaquin Monfort

FXStreet

Joaquin Monfort is a financial writer and analyst with over 10 years experience writing about financial markets and alt data. He holds a degree in Anthropology from London University and a Diploma in Technical analysis.

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