Silver Price Forecast: Former $55 Support Turns Into Selling Opportunity

Silver continues to see a lot of pressure, with more selling coming to the forefront on Thursday.

Silver

The silver market has been rather noisy during trading here on Thursday as we remain well below the $55 level. For reference, the $55 level is an area I've been watching closely for some time, as it was massive support, but we broke down below it.

The market is likely to continue to see that as an important region. So, any rally at this point in time, I'll be looking to short if we get anywhere near there. That being said, silver looks extraordinarily fragile.

I am paying very close attention to the $50 level.

I think at this point, with higher rates still being an issue, although they're not as high as they once were, and GDP being hot while PCE continues to be where the Fed had anticipated, there are concerns that the Fed will have to tighten. In fact, the FedWatch Tool right now puts about an 80% chance of the Federal Reserve hiking in December and as much as a 45% probability of it doing so in March.

This flies in the face of what people have been hoping for. Of course, higher rates will work against silver. I like silver longer term, and I do think that there is still plenty of demand out there for silver. But we had gotten so far ahead of ourselves last year that a popping of the bubble pretty much needed to happen.

The question now is, where do we find support? I am paying very close attention to the $50 level. That's an area that previously was significant market resistance, and the market memory should be very strong there. This goes back decades. So, I think that might be where we're getting ready to try to get to. Short-term rallies for me remain selling opportunities.