Silver Pullback Ahead: Key Fibonacci Levels to Watch

Silver Forecast Video for 28.03.23 by Bruce Powers

Selling pressure picks up in silver following the completion of a 78.6% Fibonacci retracement on Friday. Silver has since broken below Friday’s low signaling a possible retracement. Last week’s high of 23.51 completed a 19% advance in silver off the most recent swing low at 19.76, so it would not be a surprise to see it pull back a bit before it sets up for a bullish continuation, if it is to do so.

Initial Lower Target

If silver does keep falling the 38.2% Fibonacci retracement level around 22.07 is an initial target zone. That price zone also includes the 21-Day EMA, which is now at 22.07 as well. The 200-Day EMA follows lower at 21.83. Given its significance as long-term, the 200-Day EMA should be the maximum retracement at this point in silver if it is to maintain a bullish outlook. However, given the choppiness of the past couple years the 50% retracement at 21.63 can be watched along with the 200-Day line.

If Bull Trend Continues

If instead of falling silver breaks higher above today’s high of 23.24 it triggers a possible bullish continuation. Whether the continuation happens soon or following a retracement, silver should be on track to first reach the 25.94 price zone, which would complete a 127.2% Fibonacci extension of the latest downtrend. That price target is followed by the swing high of 26.93.

Once silver exceeds the most recent swing high of 24.62 it has confirmed a breakout above the downtrend line and a declining parallel channel. This should provide additional confidence to the bulls as it one more barrier crossed. Such a move would put silver at an 11-month high.

Monthly Bull Flag on Deck

The current pullback, if it is to continue will be an opportune to time get positioned for what could be an accelerated move higher in silver. If you look at the monthly chart of silver the current declining parallel channel takes the form of a bull flag. Therefore, the breakout of the flag/channel would be an invitation to the bulls to get more aggressive as the uptrend is continuing.

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