It’s a sell everything mood in markets today as the flight to safety reverberates across asset classes. Precious metals were standout performers in the last few months but have been overdue a more significant pullback. This might be where that comes in, with silver feeling the pinch now in a fall back under $30.
Silver (XAG/USD) daily chart
The daily price action shows that silver had been struggling to hold a firm break above the $32 mark in May. And on the rejection there, price has been finding support closer to $30 and the 38.2 Fib retracement level at $30.03. That was also the case yesterday but we’re seeing sellers start to seize more control today instead.
As a reminder, June is historically the worst month for silver over the last 20 years as seen here.
And as the break lower looks to hold now, there is scope for the pullback to run much deeper in my view. The Fib levels noted in the chart above are ones to watch but if broader markets are to carry the momentum from today, I wouldn’t rule out a push back towards the May low near $26 as well.
Looking elsewhere, gold is also down 0.8% to $2,331. The pullback there isn’t as stark with the precious metal still hugging a consolidative range since last week. But outside of precious metals, we are seeing copper also take it on the chin in a drop to $4.55 per pound. The eternal metal might be targeting a steeper drop on a break below its 38.2 Fib retracement level today:
Copper futures (HG) daily chart ($ per pound)