August 21, 2020 - (Gold Market Wire) - A market in need of a lift, even if the second most quiet period of the year - end August - beckons. That's how it looks at present. The chart below is somewhat chaotic, but it does correctly identify a crossroad of sorts. Silver, our market leader, continues to hang on to its main trend line, but every day it seems to be challenged more and more. The downtrend line was passed on Tuesday - confidently, and then the market backed and filled.

So - what to make of it all? We definitely have some congestion going on here, and one also must be concerned that past two weeks is giving us lower highs - always a cause for concern. But against that we also have to recognize a basic fact: Silver remains inexpensive right now. That doesn't help us with the state of trade today, but it is an important reminder. That, of course, does not exclude a potential for a sell-off, which could materialize. The "Tree Shakers" have already shown us what they can do, so we also have to be careful to size trades correctly, and, as ever in Silver, avoid margin like the plague.

Beyond the "big picture" considerations, the bare fact remains - this market needs to get a move on. It's poised between a state of increasing struggle to hold the trend and the potential to leap higher at any time. That makes it frustrating.

A decently priced call spread could be a good strategy - but before a holiday period the Theta could just eat it away, so we prefer a small long position with a close stop below the trend to protect from downdrafts. As always, on Friday's, the close takes on added importance, and holding the trend will be important.

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