Jun 5, 2020
Silver & Copper Prices Have Had a Good Ride — But Is It Time to Jump Ship?
Talking Points:
- Silver prices could fall back as negative RSI divergence shows a decreasing drive.
- Copper prices have increased over 20 percent, and are currently trading above the 17-year upward trend.
- The monthly viewpoint shows the base metal has entered into a key compression zone.
Silver Price Outlook.
The price of silver has risen by over 50 percent after reaching a multi-year low at around 11.90. The precious metal keeps trading well above the mid-March trend and has cleared the upper tier of the congestive range at 17.440–18.110. Saying that XAG/USD may encounter a withdrawal as negative RSI divergence shows a decreasing drive.
Silver Futures — Daily Chart
In this situation, silver prices may withdraw to a steep slope of appreciation, however, it is uncertain whether it will hold. Breaking below it could bring the start of a cooling down period before silver prices continue their recovery. However, if the upward trend holds, XAG/USD may look to break the ceiling at 18.944, one level below September’s 2019 high of 19.647.
Copper Price Outlook.
Copper prices continue to rise alongside the multi-week upward trend which formed after it had broken below a 17-year support channel and subsequently fell by over 13 percent. Saying that the base metal has addressed some of its losses and has now risen by over 20 percent since mid-March. If the upward drive continues to be strong, the next level to breakthrough might be a point between 2.6225 and 2.6325 (white-dotted lines)
Copper Futures — Daily Chart.
If you look at the monthly chart it shows copper prices have slightly climbed back on the 17-year upward trend, but may now end up in a compression zone between support and descending resistance from back in 2012. The slender nature of the area may support an upward or downward spike and could uncover an underlying directional bias. Given the nature of copper, it could likewise tell a story about the fundamental viewpoint.
James Stewart
Fundamental Analyst for Global Markets
James has over 20 years of experience trading FX, cryptocurrencies and investments products for a range of investment banks and brokers
He spent the last 10 years analyzing and writing about foreign exchange, crypto-currencies and the global financial markets
He has also spoken at a range of conferences around the globe on various financial topics.
