Silver might have carved a meaningful top around $30.00 handle, early last month. The metal had reversed sharply lower towards $23.50 lows immediately thereafter. Since then, it has been drifting sideways within a potential triangle structure.
Silver probable wave counts are as follows: At a larger degree, the metal has completed an expanded flat A-B-C around $30.00 mark. An expanded flat is a complex corrective wave that prints beyond the extremes, in this case below $13.60 lows.
The rally between $11.60 and $30.00 was potential Wave C within the expanded flat structure. Wave C typically unfolds into 5 waves, making an impulse and creating an illusion of a new trend. If the above holds true, Silver should remain below $30.00 and turn lower towards $11.60 levels again.
Looking into the lower degree wave structure, Silver might have carved lower degree Wave 1 after having dropped from $30.00 levels through $$23.44 earlier. The metal might be carving a potential triangle Wave 2 since then, and might have terminated around $27.53 yesterday.
If the above is correct, Silver should reverse sharply breaking below intermediary support seen through $26.00 levels. This would accelerate lower towards $23.44 and further. Over the next several weeks, the metal is expected to drop through $19.50 and $11.60 levels respectively.
Traders might be inclined to hold short positions taken earlier, with protective stops above $30.00 levels and projected targets below $11.60 respectively. Only a break above $30.00 would change the above bearish structure.
Technical Analysis Team
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