Silver Eyeing 21.5/19.0 Support

Hi traders!

Silver is bullish since March of 2020, as it made a five-wave (impulsive) recovery. A five-wave move in Elliott wave theory is a sign for the direction of the trend (in our case this is to the upside). That said, we know that nothing moves in straight lines, therefore we started observing a temporary correction, which started unfolding in the summer. We are observing a W-X-Y pattern in wave B), which is a complex pattern, and which is still missing one more leg lower for completion. Possible support and a turn for the metal can be at the Fib. ratio of 50.0/61.8 (21.5/19.0 zone).

A later five-wave (impulsive) recovery on the lower degree time frame charts will suggest a completed corrective wave B) and its pattern, and a resumption of the bullish cycle. That said, for a confirmation that bulls are in charge will be a break above the 26.02 level.

Silver, daily

If you are interested in more of our analysis and general outlook about the markets please check our video below where We will talk about the SP500, VIX, Commodities, USD, and sentiment.

Trade well!

Impulse wave

Impulsive wave is structured by five sub-waves in the direction of a stronger trend. The picture below shows a five-wave move to the upside, meaning that the price is in uptrend.

  • wave 1 must be an impulse or a leading diagonal
  • wave 2 can be any corrective pattern except a triangle
  • wave 2 must not retrace more than 100% of wave 1
  • wave 3 must be an Impulse
  • wave 3 must be longer than wave 2
  • wave 4 can be any corrective pattern (zig-zag, double or triple zig-zag, triangle, flat, double or triple three)
  • wave 4 should never trade into a territory of a wave 1
  • wave 5 must be an impulse or an ending diagonal
  • wave 3 should never be the shortest wave when compared to waves 1 and 5 

Disclosure: Please be informed that information we provide is NOT a trading recommendation or investment advice. All of our work is for educational purposes only.

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