The $31 level being a large round psychologically significant figure comes into the picture, but it's also an area where we've seen a lot of noise in the past. If we can break above that level, then the market is likely to go looking at the $32.35 level. This is an area that has been important more than once, so it is a situation where we will keep an eye on it.

Pulling Back Means Something

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Pulling back the way we have suggests that traders believe that the Federal Reserve will probably be fairly tight for a while. The fact that they chose to do nothing, and the statement is somewhat hawkish. It's possible that we may not see rate cuts at all this year and that would be negative for silver, at least in theory. All things being equal, I think this is a market that is still just simply stuck in a range. And as long as that is going to be the case, if you're a short-term back and forth type of trader, it could work out for you. But if and when we break above that $31 level, you have to assume that we are going to go higher. If we break down below the 200-day EMA, then we start to set our sights on the $28.75 level, which is where we just formed a major double bottom. That being broken to the downside probably sends silver plummeting. At this point though, I think we're just looking at a lot of sideways grind.

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