At the beginning of this month, silver finally broke above $40 per ounce. Since then, it hasn’t looked back. Overnight, it briefly broke above $47 to hit its highest level since May 2011, just as it was coming off its all-time high around $50.
Silver has gained over 17% in September so far. But, as with gold, its daily MACD shows that it is very overbought. Traders should be prepared for a significant pullback. But timing such a move is incredibly difficult, and there’s nothing in the rules (because there are no rules) that says silver can’t rally further and become even more overbought.
There’s no doubt that, after a very slow start, silver is finally playing catch-up with gold. And it could be that silver’s rally has further to run, once it puts in a decent correction, thereby giving the daily MACD an opportunity to reset.
Source: TN Trader
