Evans’ Comments at the Chicago Fed and Silver Prices Breach
Silver prices have just breached last week’s low of $14.70 following somewhat more ‘hawkish’ than expected comments from the Chicago Fed’s CEO, Charles L. This has triggered Dollar buying and subsequently lower silver prices in today’s session.
Scalpers will probably use the $14.80 high as a base for short positions aiming for the psychological level of $14.50. We note that the October low is at $14.38 and prices will probably find some support as we reach this level. Scalpers will also probably book profits as we near this level.
Traders with a slightly longer term trading horizon will probably use the NFP high of $15.10 as the trend defining level. These traders are probably waiting for a pullback to the 14.83-14.89 range and see such an event as an opportunity to add to short positions.
The reason why they would not use the scalpers high of $14.80 is that it’s a weaker resistance level, and therefore not a stable enough platform for most traders to trade on.