How Low Will Silver Go?

Squeaky_Hobbs

Hi there!

I'm new here, and relatively new to Fibonacci Retracements, but looking at the SLV daily chart, it appears to me that it is on its 3rd leg down, and I THINK it is headed to at least $15.50.

I look forward to all serious replys.

Thanks!!!

SH

markd

A natural support level would seem to be 15.10-15.25. 15.10 is the approximate 61.8 retracement of the leg up from Sep2018 to Sep2019. 15.25 approx is the Jan-Feb2019 peak, which is resistance that could become support.

But, if the recent legs up are the beginning of a much longer bullish trend, prices could stay above the 61.8 level and form a base around the 15.72 50% retracement level without getting as low as 15.10-15.25. There was considerable volume in August above the breakout, so buyers at those levels could come in to add to their positions.

lmkwin

How low can it go? It can retrace 100% or more of its recent movements. This security has spent more time making 52 week lows than 52 week highs in its lifetime. Now, it did recently make a 52 high, on decent volume.

I don't use Fibonacci really but another way to "see" Fib retracement levels is to use a Point and Figure Chart. Put a 1 period SMA on it. The 1 period SMA bisects each column, so you can see where the middle is for visualizing "retracement" levels.

16.00 is a High Pole Warning on the traditional 3 box reversal chart. Those are usually not a great thing to see on a PnF chart. Especially if it adds more boxes of O's to cover the entire rise in X's. That is called a 100% Pole if it does. In Prashant Shah's new book on Point and Figure charting he backtests various patterns against 20 years of data and found 100% Poles to be among the more reliable patterns. Poles come in two flavors, Bullish and Bearish.

Now, admittedly, the 50% retracement isn't really a true Fibonacci number but you can get a ball park of the 38 and 62 levels by using the box or two (depending on the price of the security) above and below the 1 period SMA mark.

Another thing you may find of interest is to add the 5 column SMA on to the PnF chart. These also will provide an additional visual of where short/ intermediate term support or resistance may lie.

Many "advanced" or complex PnF patterns have 5 or more columns. These would be patterns like triple tops and bottoms and triangles. Basic Buy and Sell patterns have 3 columns. The 1 column MA above the 5 column MA usually presents a bullish appearance, below is bearish.

PnF charts also provide ready made Vertical Price Objectives based on counts. Wyckoff used Horizontal count method on PnF charts which can also provide insights.

How low can it go? Is anyone's guess. History says it tends to live near the lows, but.... commodities may be perking up. They "should" at some point, right?