Gold Market Wire
News, analysis and commentary for gold traders and investors
Silver Market Update
Silver Leads Metals Recovery
November 22, 2021 - (Gold Market Wire) - Silver has bounced back this early European a.m., and is getting set to take on the power downtrend from last week.
In the above chart we tweaked the main downtrend to show a more conventional approach. It has validity, but we still also consider our previous:
So, the important consideration is that Silver has managed a recovery in the face of a US Dollar that just won't quit. There has been a further weakening in EUR/USD, now down to 1.1270. With this in mind we can see little reason for a strategy change. Long Dollar and Long Metals, with a trading view on the latter.
Our last length is just shy of being flat to the market, but was very small in size. As it stands now, we hold that position, but want to see some confirmation with the power downtrend getting cleared. The general market is in a state of chaos, no doubt - but that is what metals feed on. For the nervous type, you can trade out of length here and get completely flat, awaiting developments. These days, one could hardly blame people for such a stance.
On the FX side, one has to admit, that everything is favouring the US Dollar. It's amazing to see such a thing, in the wake of a Biden Presidency which is, if anything, shambolic, or perhaps even deliberately shambolic. But, Europe is on the brink of near-revolution it seems. And few people would want to see a lot of capital parked in a Euro-Zone that is full of problems, on the border with Russia. The Dollar gets the action, by default.
Elsewhere, the international situation continues to deteriorate, step by step. Ukraine and Taiwan are issues that will simply not be calmed by diplomacy. Conflict is now inevitable. It is only a question of when and what form it takes. Some analysts believe confrontation over one or both of these 'theatres' could be less than a year away, with all that that portends. For the strategists who like to opine on such things, it would seem unlikely that one would take place without the other. Can NATO/US forces respond to both arenas simultaneously? It's questionable. But given the political chaos at home, it would provide an opportunity for deflection, in a country that is now so polarized it seems divided beyond repair. That division is presenting weakness to the world. The belief that instigating, or in this case, even responding to a war, to unify the country in an attempt to deflect domestic political problems, seems fraught with problems.