Yesterday, silver prices tagged the NFP-day low almost to the penny before reversing strongly higher to take back most of the prior day losses. But we aren’t buying that it will hold just yet.

Silver still has a fully-loaded boat of large silver traders long in the futures market (record long), of which their net position may have been reduced this week, but we won’t likely find that out in today’s COT report given it is for the week ending on Tuesday. The real meaty move lower came on Wednesday. At any rate, crowded trades are not where we want to be, but if price action suggests the crowd is right, though, then they are, at least until they aren’t. So far, broadly speaking they have been right, minus the newly minted long positions in the past three weeks.

The short-term chart still points lower since peaking on 7/11. During the Asian session, silver turned lower off a trend-line which runs off that peak created nearly two weeks back at 20.66. Lower lows and lower highs have been marking the trend lower.

At this time a move above the trend-line will be required to break the series of lower highs and lower lows, and until then silver leans bearish, neutral at best. A breakout above may not lead to a new leg higher, but the 20.66 area could be achieved as a broader daily range continues to build.

The support right around 19.20 will be pivotal; if the metal breaks below there, then a move into the mid-18s becomes the risk. Which is a spot that holds significant as long-term support. Perhaps by then some of the speculative longs will have puked out their positons and a possible reload for another shot higher could take shape. It is still too soon to discuss that, so we will stick with the short-term structure suggesting some work needs to be done by the bulls to turn the technical structure positive.

Silver (XAGUSD) 2-hour w/weekly inlays