Are you ready to take advantage of the bullish reversal on a channel breakout in the silver market? As experts in the stock market and trading, we at Extreme Investor Network have analyzed the recent developments and have some unique insights to share with you.
On July 3, silver broke out of a bearish retracement channel with a decisive move, forming a wide ranged green candle that closed near the highs. This breakout not only pierced through a downtrend line but also signaled a bull breakout of both the 20-Day MA and 50-Day MA. What’s interesting to note is that during the recent decline, the 20-Day MA approached the 50-Day MA without dropping below it. As prices reverted towards the mean, the convergence of the two moving averages hints at a potential strong rally ahead.
But why stop here? Lower volatility typically precedes higher volatility, suggesting that silver may be gearing up for more significant price movements. Investors may use any declines towards support levels as an opportunity to build positions at lower prices. This strong support area is expected to fuel a bullish rally that could surpass the recent swing high of 31.76. A pullback before an eventual breakout may refresh the market dynamics, setting the stage for a sustained rally towards previous highs ranging from 32.30 to 32.52.
The 50-Day MA trend support has proven to be pivotal in recent price action, serving as a crucial area for trend continuation as prices appreciate. Despite a recent attempt to breach below the 50-Day MA, the support eventually held, leading to a bullish recovery and a recapture of the line. While another test of support may be on the horizon, the 50-Day MA is expected to remain strong and prevent further declines in prices. Additionally, a bullish signal on the July monthly chart adds to the bullish outlook, suggesting the potential for follow-through on a larger time frame.
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