Silver eases lower to start European morning trade
Silver is down by a little over 4% to a fresh low of $27.80 now as we get things goin in Europe, with the hype starting to die down now after having peaked at $30 yesterday.
A key development this morning has been that CME has raised margin on silver futures and that is arguably a significant factor in driving prices lower today.
Adding to that is the fact that silver had moved up by 19% in just three days, so there was a case of things going too far, too fast as well. The $30 has been a key target for the “big boys” and profit-taking activity is certainly a consideration at yesterday's levels.
The drop now takes silver back under $28 and below its 38.2 retracement level – which stalled the earlier decline yesterday.
A firm break below $28 will put focus on the 50.0 retracement level @ $27.48 next but it could be a slippery slope lower towards the 100-hour moving average (red line) @ $26.86 next by the look of things.
That said, such a move will still put silver up by 6.5% compared to early Thursday levels.