Silver: 18.50 Within Reach as Bearish Pressure Persists
The medium term daily candle chart below shows the price of Silver, a contract for difference (CFD) on the underlying precious metal Silver, and currently trading around 18.625 around time of publication today.
Last time Silver was reviewed in the Ideas You Can Trade series, a false-breakout to the upside return swiftly back into the downtrend that Silver still remains stuck within.
Since then the metal has traded lower, and is very close to a support level near 18.50, an area in which Silver has rebounded from bearish momentum on at least three occasions since last December.
If support around 18.50 fails, Silver should continue its bearish trajectory, whereas if buyers come in around this level expecting a reversal then Silver could see a quick lift back higher even if it is short-lived. An additional candle chart below shows the overall trend over a longer term period.
Below are examples of how to trade a bearish continuation or a bullish reversal:
1. BULLISH BUY ENTRY ORDER: Create a “Buy Entry Stop” @ 18.82 with a Limit to take profit @ 18.99 and a stop-loss @ 18.67 Risk/Reward Summary: Limit risk = +17 points profit / (-15) Stop-loss risk = Gain to Loss ratio = 1.13
2. BEARISH SELL ENTRY ORDER: Create a “Sell Entry Stop” @ 18.59 with a Limit to take profit @ 18.49 and a stop-loss @ 19.68 Risk/Reward Summary: Limit risk = +10 points profit / (-9) Stop-loss risk = Gain to Loss Ratio = 1.11
Medium term chart (daily candles):
Medium term chart (daily candles) zoomed out: