- Silver’s 1-hour momentum is stalling, giving rise to the prospects of a correction.
- A Fibo analysis of the W-formation on the daily chart acts as a means to measure the downside target.
Nevertheless, the price has carved out a daily W-formation which is a bearish chart pattern.
Once the momentum starts to slow, bears will look for an entry to target the neckline of the formation or at least a 38.2% Fibonacci retracement of the bullish impulse.
If there is a confluence of both, such as is the case where things stand currently, then this offers additional conviction that the level will be tested.
The following illustrates the prospects of a downside correction from both the daily and hourly chart from where traders can monitor for a bearish environment, structure and optimal entry point.
On a break of $27.56, prior line char highs, $27.33 as the 38.2% Fibo comes into play as the next downside target.
Meanwhile, the chart’s conditions are still bullish and bears will monitor for bearish structure and a shift in technical conditions.
Until then, there is still room for an upside extension.