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(Kitco News) – The silver price breakout appears to be gaining momentum. As you can see on the daily chart below, silver has formed a new higher low/higher high pattern and has surged above the psychological $25/oz area. This seems to have a lot to do with the correlation that gold and other precious metals are bulls. Still, the market supports the gray metal.
Looking closer at the technicals, the trend line in gray has finally been broken. There is always a chance of a retest of the trend line, but the encouraging sign is that volume has surged higher on the break. Also, the price is above the Volume Control Point (VPOC), denoted by the red horizontal line. This is a good signal that the trend is turning bullish.
In terms of resistance zones, the next one is marked by the high volume nodes on the volume profile indicator. $26/oz has been sticky in the past and could become sticky again. Additionally, $28.90/oz is the more important one and when prices get that high, the prominent price of $30.35/oz follows.
On the downside is VPOC area (red line) but the consolidation low just below $22/oz is the key area of support.
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