Hi Traders! Silver forecast update and follow up is here. On September 29th I shared this “Silver Technical Analysis And Forecast” post in my blog. In this post, let’s do a recap of this setup and see how it has developed now. If you would like to learn more about the way we trade and the technical analysis we use then check out the Traders Academy Club. Spoiler alert – free memberships are available!
My Idea
Looking at the H4 chart after the strong bearish move, it looks like a correction is happening currently. We have a potential bearish hidden divergence between the first high that has formed on 15th September 2020 and the second high that has formed on 29th September 2020 based on the histogram of the MACD indicator. Also looking at the Stochastic Oscillator we could see that it has reached its extreme. We may consider these as evidences of bearish pressure. So based on all this, my view is bearish here and once this pullback completes itself I expect the price to continue lower further.
Silver H4(4 Hours) Chart Current Scenario
Based on the above-mentioned analysis my view was bearish here and I was expecting the price to continue lower further after pullbacks. The price action followed my analysis and the facts were supporting the bearish view here. We had a false break with bearish divergence that has formed between the first high that has formed at 24.394 and the second high that has formed at 24.507 based on the MACD indicator which we may consider as evidence of bearish pressure. Also on the H1 chart, we had a breakout of the most recent uptrend line and there were no contradictory signs. The price then moved lower further exactly as I expected it to and delivered a fantastic move to the downside.
(Note: You can learn about a Killer Forex Strategy “Double Trend Line Principle” here)
You can see this move clearly and the most recent uptrend line breakout on the H1 chart below:
As traders we always have two choices, the first one is to fall in love with our analysis and try to convince the market and expect the price to move in the direction as per our wish. The second one is to follow the facts that the market provides us and make the right actions according to that. As you know the first option won’t help us and as you can see in the example above what happened when we followed the facts that the market hinted us and took the right action according to that.
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Happy Trading!
Yordan Kuzmanov
Chief Trader at the Traders Academy Club
