The current silver price trend is once again at a critical juncture. It has been four years since the price of silver crossed an important trend line. However, the present setup will result in either another correction lower, or a much higher price.
This is a ten-year chart which shows the current trading setup for silver:
The blue line represents the 50 month moving average,and the red line, the 200 month moving average. Since the price of silver fell below the blue line at the beginning of 2013, its support has been the red line. It did not fall below the red line at its low in the beginning of 2016 and has bounced twice off the blue line, which is now acting as resistance by traders.
Currently, the silver price is hitting up against the 200 month moving average blue resistance line. If the silver price breaks above and closes above it, we could see a much higher silver price. However, if does not, then we could experience another short-term correction.
Looking at the current silver COT REPORT, there is a record commercial short position against silver. The Commercial short positions are from the large bullion banks: