FX.co ★ Silver technical levels and trading recommendations for February 8, 2013

Overview

Proceeding from the today's H4 chart, silver takes a downward move after breaking the upward trend line yesterday, but it is trading between the Support level 31.50 and the Resistance level 31.80, keeping its move above the upward trend line. If the pair continues its slightly downward move and manages to close 4 hours below the Support level 31.50, this will give a strong indicator for a bearish movement enabling the Support level 31.20. Then we should wait for breaking this level to continue the bullish view. On the other hand, if silver is able to break the upward trend line and the Resistance level 31.80, this will provide us a good opportunity to buy, enabling the Resistance level 32.30. Then we should wait for closing above the Resistance level to continue the bullish movement. If silver breaks this Resistance level it indicates a bullish strength providing new buy-signals with 32.50 level target, the technical indicators will provide sell-signals. But as long as silver is stabilizing above the upward trend line, the upward move is still expected also invalidating the bullish outlook. Therefore, we should wait for more confirmations before making the decision.

Resistance and Support levels:

R3(32.50) R2(32.30) R1(31.80) S1(31.50) S2(31.20) S3(30.75)

Trading recommendations: According to previous analysis, we recommend selling after bouncing from the upward trend line with TP1 31.40, SL closing 4-hour chart above the Resistance level 31.80.