Welcome to Kitco News’ Perspectives 2022 series. The new year will be filled with uncertainties as the Federal Reserve seeks to pivot and tighten monetary policies. At the same time, the inflationary threat continues to grow, meaning that real rates will stay in low to negative territory. Stay tuned to Kitco News to learn from the experts on how to navigate turbulent financial markets in 2022.
(Kitco News) – Veteran commodity futures traders are familiar with the old trading adage: “Markets can and will do anything imaginable to frustrate as many traders as possible. Money is particularly good in this area. Reason: It has the luxury of acting as a safe haven asset on some occasions, and acting as a risky industrial metal on other occasions, with no one being able to predict what personality the metal will present at any given time. This is why it is very important for silver traders and investors to look at the charts for clues about the future direction of prices.
Nearby Comex Silver Futures weekly continuation chart favors the bearish camp. Prices have been trending down for 11 months, from the February 2021 high of $ 30.35 an ounce. Silver futures price movement will be required near above resistance major psychological at $ 25.00 for bulls to be billed, from a longer term technical basis.
The silver futures monthly continuation chart is more neutral, showing that the price action in recent months has been mostly choppy and sideways. A fall below the longer term chart support at $ 21.00 would give the bears more longer term technical power and also suggest a dip towards the $ 15.00 area.
Combined, the weekly and monthly silver futures charts provide a longer-term bearish neutral position for the market. It is important to note, however, that one major fundamental has come into play and will likely continue to be in place for at least the next year or so: a continued rise and even problematic price inflation around the world. History shows that durable assets, including precious metals, tend to be favored over paper assets, like stocks and bonds, in times of superheated inflation. Silver will continue to follow the gold market fairly closely, especially during times of high risk aversion in the market.
Warning: The opinions expressed in this article are those of the author and may not reflect those of Kitco Metals Inc. The author has made every effort to ensure the accuracy of the information provided; however, neither Kitco Metals Inc. nor the author can guarantee such accuracy. This article is for informational purposes only. It is not a solicitation to effect an exchange of commodities, securities or other financial instruments. Kitco Metals Inc. and the author of this article accept no responsibility for any loss and / or damage resulting from the use of this publication.