Early Market Update: Silver Bounces Right Off The Important $27.50 Level

After silver fell nearly $2.50 from its highs in Asian trading last night, it bounced right off its important $27.50 level, twice this morning. It will be interesting to see where the silver price rests and the end of the day.

This morning on my SRSrocco Report Twitter Feed, I posted the following Tweet:

DON'T THINK TECHNICALS MATTER... LOL

The silver price bounced twice off the long-term monthly $27.50 level.

While it can fall below it, it is important that silver closes above $27.50 by the end of August for a continued RALLY to $35. pic.twitter.com/mUe87sZxw4

— SRSrocco Report (@SRSroccoReport) August 7, 2020

Now, there is no coincidence that the silver price RETESTED the $27.50 yesterday and bounced off it again this morning.  Then about an hour later we had the following intraday silver chart:

(Click on image to enlarge)

After the silver price hit the $27.50 level, then it moved up considerably. If we look at the past four (1-Hour) candlesticks, the long wicks on the bottom suggest that the BULLS are more in charge than the BEARS… time will tell.

I have seen this sort of bullish setup several times the past month. Typically, when there are 2-3 of these bullish candlesticks, it suggests a short-term bottom, with a higher trend.

For silver to continue to $35 during this present rally, it must close above the $27.50 level, shown on the monthly chart, on the last trading day in August.

(Click on image to enlarge)

Again, it will be interesting to see how the silver price trades over the next three weeks. If we look at the silver price trend during late 2010, it did not close below the $27.50 level. So, it seems that this is a critical level for silver to hold to remain in an upward trend over the next several months.