Silver Brewing a fall soon?
Sell Silver Futures
Rationale:
Silver has formed a rising wedge pattern on the 4-hour chart, indicating exhaustion in the recent uptrend. Price action shows multiple rejections near $48.40–$48.50, while the CCI momentum indicator is flattening after reaching overbought territory, hinting at a potential reversal. A breakdown below $48.00 could trigger a corrective wave toward $45.70.
Macro Headwinds:
• US Dollar Strength: The Dollar Index continues to hold firm above 105 amid hawkish Fed commentary, limiting upside for precious metals.
• Rising US Yields: The US 10-year yield remains elevated, making non-yielding assets like Silver less attractive in the short term.
• Cooling Industrial Demand: Recent Chinese PMI data points to a softening recovery in the manufacturing sector, a key demand driver for Silver.
• Fed Rate Outlook: Markets are now pricing in the possibility of delayed rate cuts, keeping real rates higher for longer that is a negative for Silver.
Key Levels:
• Entry Zone: Below $48.05
• Stop Loss: $49.47
• Target: $45.70
• Risk–Reward Ratio: ~1:2.5
Technical View:
Trendline breakdown confirmation on the 4-hour timeframe would validate the short setup. Sustained trade below $48.00 may invite further selling pressure, with supports seen near $47.00 and $45.70. A decisive close above $49.50 would invalidate the bearish structure.
