CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 81% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.
CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 84% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you can afford to take the high risk of losing your money.

Silver

Market Opportunities - 29/06/2022

29 June, 2022

The example below uses Contracts For Difference (CFDs). Calculations are only on the price of the specific instrument on the date below and calculations indicate a possible opportunity for profit or loss. No representation or warranty is given as to the accuracy or completeness of this information, consequently any person acting on it does so entirely at their own risk.

Silver weekly uptrend opportunity based On 1.00 Lot Calculation:

SILVER USE AND MARKET SHARE:

  • SILVER USE: Two thirds of annual demand come from industrial use, and the rest is used for jewelry and investments. According to BullionVault, silver is invaluable to batteries, dentistry, glass coatings, LED chips, medicine, nuclear reactors, photography, photovoltaic (or solar) energy, RFID chips (for tracking parcels or shipments worldwide), semiconductors, touch screens, water purification, wood preservatives and many other industrial uses.

  • MARKET SHARE (PRODUCERS): Mexico is the largest producer holding 22.7% of the markets, while Peru is the second largest with 14% of the markets. China is third on the list with 13.8% of the global production, while Chile takes up 6.00% of the markets. Russia holds 5.4% of total market share.

  • MARKET SHARE (CONSUMERS): The five largest silver consumer in the world are India, USA, UK, Germany and China.

  • EXPECTATIONS FOR SILVER (2022): Metals Focus forecasts a 5% rise in global silver demand due to further structural advancements in industrial fabrication, which is expected to achieve another record high in 2022. Jewelry and silverware demand should continue their post-pandemic recovery this year.

ANALYSIS:

  • EVENTS (STARTING JUNE): SHANGHAI (CHINA) REOPENING FROM COVID-19 LOCKDOWNS TO BOOST INDUSTRIAL DEMAND FOR SILVER. Shanghai is a large finance and industrial center in China, which hosts a lot of industrial factories that should reopen for operation starting June 1, 2022. Therefore, what was lost in terms of demand over the past weeks, will be soon recovered.

  • INVESTMENT USE: INFLATION HEDGE. Silver is also expected to rise in demand due to still very high inflation rates in the US and globally, as investors will seek to protect their wealth against inflation which eats away at the purchasing power of investors’ assets.

  • G-7 COUNTRIES US, UK, JAPAN, CANADA DECIDED TO BAN GOLD IMPORTS FROM RUSSIA. The risk grew that countries could target other commodity markets next.

  • TECHINCAL ANALYSIS: SILVER SEES STRONG PSYCHOLOGICAL SUPPORT AT $20. After breaking above the mark of $20 in July 2020, Silver has ever since managed to stay above that strong psychological price.

  • RECENT PRICE ACTIONS: SILVER HAS HAD A DOWNWARD CORRECTION OF AROUND 22% OVER THE PAST THREE MONTHS (FROM $26.197 TO $20.431). Silver tested its lowest price since July, 2020 ($20.431).

  • ANALYST OPINION: Commerzbank sees silver reaching $26 an ounce in 2022.

Silver, June 29, 2022
Current Price: 20.70

Silver

Weekly

Trend direction

UP

Resistance 3

25.00

Resistance 2

23.50

Resistance 1

22.00

Support 1

19.50

Support 2

19.00

Support 3

18.50

Example of calculation base on weekly trend direction for 1.00 Lot1

Silver

Pivot Points

Resistance 3

Resistance 2

Resistance 1

Support 1

Support 2

Support 3

Profit or loss in $

43,000.00

28,000.00

13,000.00

-12,000.00

-17,000.00

-22,000.00

Profit or loss in €2

40,901.74

26,633.69

12,365.64

-11,414.44

-16,170.46

-20,926.47

Profit or loss in £2

35,242.15

22,948.37

10,654.60

-9,835.02

-13,932.94

-18,030.87

Profit or loss in C$2

55,290.26

36,002.96

16,715.66

-15,429.84

-21,858.94

-28,288.04

1. 1.00 lot is equivalent of 10,000 units
2. Calculations for exchange rate used as of 12:55 (GMT+1) 29/06/2022

Fortrade recommends the use of Stop-Loss and Take-Profit, please speak to your Client Manager regarding their use.

  • You may wish to consider closing your position in profit, even if it is lower than suggested one

  • Trailing stop technique can protect the profit – Ask your Client Manager for more detail

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