FX.co ★ Silver Wave analysis for January 08, 2013

Silver Elliott Wave
Since our last analysis silver has been trading downwards, corrective (B) wave (coloured green) of the bigger (4) wave (coloured red) has been developing. Yesterday during the Asian and European sessions we could observe descending movement from 30.43 towards the 29.84 level and we can consider this move as the end of the (B) wave (coloured green). Therefore, during the New York session when development of the final (C) wave started, silver retraced back to 30.18 level. At the moment this commodity is trading around 30.20 level and we expect the price gets higher today. In accordance with our wave rules and taking into account that the wave 4 should retrace 38.2% of the wave 3, we can define the potential targets with measuring wave 3 with take profit at 30.96 (38.2% of wave 3). To reduce the risk, we can use support at 29.90 level as stop loss.

Support and Resistance
(S3) 29.237 (S2) 29.548 (S1) 29.852 (PP) 30.163 (R1) 30.467 (R2) 30.778 (R3) 31.082

Trading forecast
Proceeding from Elliott Wave rules today, the trend is expected to begin the upward movement. That is why long positions at level 30.25 with stop loss 29.90 and take profit at 30.96 are recommended.