Silver – Approaching a key $29.80 to $30.00 resistance zone

This was the move in Silver I was looking for last Thursday, however I expected to see a simple 3-wave (w,x,y) correction rather than an expanded flat (see 120 minute chart below), whereby price makes a slightly lower low before correcting back higher. After the recent developments in the past 48 hours, the short-term technical landscape as well as the current risk vs. reward environment now favors Silver bears. As stated on Monday, “this leads us to believe potential rallies are likely to be faded and a larger setback is due before finding a more meaningful bottom”, and this C-wave or “rally” is what we are currently looking to fade. The precious metal is currently approaching a confluence of resistance between $29.80 and $30.00. Therefore, I believe establishing ½ our short position at current levels ($29.65) & the remaining ½ between $29.85-95, with stops above $30.85 looking for an eventual move towards $27.85/90 initially could make sense.



KEY TECHNICAL LEVELS:

* Long-term Trendline Support, now Resistance = $29.85/95 (blue trendline)
* C = 1.618 x A at $29.95
* 50% Retracement = $29.88
* Prior Wave 4 High = $29.85
* Horizontal Pivot = $29.30/35 (blue highlight)
* January 7th low (now support) = $28.30

Пот материалам : FOREX.com

13.01.2011