The price stalls after hitting the major trend line

• Silver has met resistance at a trend line and is stopping after a bull run.
• It should make a decisive break above the trendline to continue its uptrend.

Silver (XAG/USD) hit a key trend line in the $30s and stalled. He has posted several Doji-like candlestick patterns in recent days. Dojis are days when the price closes very close to the level at which it opened. This is a sign of market indecision.

Silver daily chart

Silver has been in an uptrend since the early August lows, although it has also corrected in the second half of the month. Since it is a principle of technical analysis that “the trend is your friend”, the uptrend in Silver is more likely to extend. Therefore, it could go higher. A decisive break above the trend line would confirm a breakout and continuation at $32.94, the 0.618 Fibonacci ratio of the C leg extended above.

A decisive break would be one accompanied by a long green candlestick that broke clearly above the level and closed close to its high, or three candlesticks in a row that broke above the level.

Although the price action has formed several Japanese Doji candles in recent days, it has not formed an inverted candlestick pattern such as a Shooting Star, Bearish Engulfing or Hanging Man, for example. As such, it is still too early to say that the precious metal will correct lower.

Silver has likely completed a Measured Move price pattern from the August 8 low. Such patterns consist of three zigzag waves. Another characteristic of these patterns is that the A and C waves are usually of similar length. In the case of silver, A and C reached a similar length. This further suggests that prices will stop and rest for a while or even pull back.