SILVER Technical Levels and Trading Recommendations for October 5, 2012 2012-10-05
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The H4 chart demonstrates today that silver is still stabilizing between the Resistance level of 35.00 and the Support level of 34.25 after its failure to break the Support level of 34.25 today. If silver takes an upward movement and manages to close 4H above this Resistance level, it will provide a good opportunity to buy above the Resistance level as well as make it possible to reach the Resistance level of 35.50 as the level target. After that we should wait for breaking out of this Resistance level to continue the bullish move. In case silver is able to break the Resistance level of 35.50 and close 4H above, we will get a bullish strength which will provide new buy signals and enable the Resistance level of 36.00 as a level target.
On the other hand, if silver reverses its bullish move and takes a downward move after its rebound from the Resistance level of 35.00, it will be a strong indicator for the bearish move after closing 4H below Support level 34.25 enabling Support level 33.90. In this case we should wait for breaking this Support level to continue the bearish view. Based on the given H4 chart, the technical indicators provide buy signals, but as long as the Resistance level 35.00 is unbroken, the downward move is still expected and invalidating the upward movement. Therefore, we should wait for more confirmations before making the decision.
Resistance and Support levels
According to the previous analysis, we recommend buying in case of closing 4H above the Resistance level of 35.00 with TP 35.50; SL closing 4H below the Resistance level might be appropriate.