We spend a lot of time focusing on gold, however, its little brother silver is currently in a much more interesting situation from a technical perspective:

Click to enlarge

Silver_Daily

There is substantial promise in the silver chart:

  • Strong support clearly exists around and just below the $19 level
  • Bullish momentum divergence at December low ($18.72)
  • First time price moves above the 50-day simple moving average since October (indicative of a bottoming process with a potential fresh uptrend)
  • Little resistance above $20.50 until $21.50-$22 area
  • Gold/silver ratio currently near 62 should see some reversion to the mean (around 55) this year

We are seeing some early buying coming into silver futures in Asia - $20.25 is an important short term level with the key breakout level at $20.50 just above:

 Silver_1.12.2014