Silver has been trading in a tight range for the past 22 days. Price action during this period has been confined in a flat channel with a height equal to 4.1% of the last closing price. Such pattern has not occurred in SLV since inception. This market is searching for direction. Historically, a 20-day channel with a height of less than 10% of last price shows a small positive bias for short positions that hold a trade for 20 days or 10% profit.
The 22-day flat channel is indicated on the SLV chart above and lies between $28.50 and $27.35. A scan showed that a channel of these duration and proportion has never occurred before in SLV. Channels with a height less than 10% of last close offer a small positive bias for short positions as already mentioned but significance is borderline. This may be a true case of a stand still market where participants have no idea what to do next.
Disclosure: no relevant position at the time of this post and no plans to initiate any positions within the next 72 hours..
Charting program: Amibroker (Charts created with AmiBroker – advanced charting and technical analysis software. http://www.amibroker.com/”)