Friday's Market Minute: Is Silver Starting To Slip?

Gold futures have seen some of the biggest trading action across the commodities space lately. The yellow metal finally snapped a 9-day streak of gains yesterday, but it’s still up a hefty 10% during the same time period. Silver looks to be taking a breather – in relative terms at least, as it’s only up about 6% this week. But technical indicators suggest the metal’s advance could be slowing, and this could be significant as the two metals typically show strong correlation.

Tuesday’s new highs in Silver retreated into a Spinning Top candle pattern, which typically suggests indecision among traders and can be the precursor to a reversal. Furthermore, the RSI showed bearish divergence on Tuesday, as price reached new highs while this momentum indicator did not. RSI now sits on the brink of the overbought level, and a move below the 70 level would be another bearish signal. Volume Profile shows an area of heavy trading near 23, so watch for support there, as well as around the 21-day EMA near 21.45. For gold, 1900 is the price level to watch for now.