Last October, my colleague mentioned that the price of silver has recently marked a new all-time high when it broke above its previous high at 21.34USD (kindly see this). He also mentioned that the sky is the limit for this commodity given the fact that it just broke out from the previous all-time high at 21.34USD and its price is far cheaper than gold. Yet, he was correct and in just 3 months silver price shot up by 46% to an all-time high of 31.23USD last week but since then, silver started correcting.
The recent drop of silver along with other commodities were caused by the profit taking of investors and traders including concerns on the US economic data coming ahead. Most currencies weakened against the US dollar as well.
From the technical point of view, silver has broken down from its 5-month uptrend and could head lower to its immediate support at 28.00USD. In case that level doesn’t hold, the next support could be 25.00USD. If silver further drops below that price mark, the next support could be the 28-month uptrend. On the bulls side, if silver heads back north, heavy selling pressure could be encountered at its all-time high. If that gets cleared out then the sky is the limit once again.