I’ve written recently about the important levels to watch for in silver and went so far as to state that a “breakout” day was close. It appears as though today is that breakout day but unfortunately for longs it looks like the breakout was to the downside. This could imply that prices are now going to trend downwards to test the old support or, as is often the case with silver, we may see a whipsaw move to reverse. Bottom line, confirmation on the move is needed.
As I warned in another of my posts, it all comes down to how you treat silver. That is, whether or not you consider it to be a monetary metal or an industrial metal. I used the breakdowns in copper and platinum as my examples that foretold the potential breakdown in silver coming.
With Platinum rallying hard today, it is yet to be seen whether this is merely a counter trend bounce or the start of a new rally in Platinum. However, the breakdown in silver is what we are focussing on now. Here’s the latest chart using the SLV. Short term, this could have ominous ramifications for the price of the white metal. Silver needs to reverse hard or face testing the old lows of $26.15 fairly soon.