silver price is correcting back after rallying during may.
the correction is likely to run out of steam eventually and the uptrend to resume.
support at $27.51 may provide the staging post for a bullish revival.
silver (xagusd) price is correcting back after the strong rally in may became overbought and bullish traders unwound their longs.
despite the correction, the short-term trend for silver remains bullish and given the old adage that “the trend is your friend,” it is expected to resume and push higher once the pull back ends.
4-hour chart
there are no signs yet that the correction has ended – though downside momentum is slowing – and it is possible silver could continue falling.
the next major support level that may act as a barrier to further losses is at the former april 26 highs at $27.51. a reversal at that level could signal the resumption of the dominant uptrend.
a break above the may 10 high at $28.77 would indicate the formation of a higher high and suggest extension.
beyond that there is the possibility of a retest of the $30.00 long-term range highs.
