Silver is "Coiling Up" on the Daily chart and there is also a minor downward sloping trendline that may be coming into play soon. Take a look at the Daily chart below and the drawings. What the Coiling pattern shows me is there is a lot of tension in the recent open interest and that makes it a compression chamber of energy brewing. There is only one side in the zero sum game of futures that can make a profit so should Silver start to make a move away from the Coil with an increase in Volume, the losing side of the contract is going to be feeling some heat, especially those who are "leveraged". Exiting the losing trade will increase the fuel for further trend continuation. It all comes down to how strong are the hands in the open interest and which way Silver breaks out of the pattern. There are those on the sideline that may move into the trend and make the loser pay up. I believe the Coil type pattern offers a trader a higher than normal chance for non-random price excursion on the breakout based on the logic behind supply and demand and not some bogus "technical indicator".
The path of least resistance is still lower on the Daily chart, but the path of least resistance doesn't stay in one direction forever. The bottom line here is that the Silver Bulls have had little to cheer about, and there may be more disappointment on a failure to breakout here to the upside, but there is a chart development that should be paid very close attention to in my strongest opinion for the near term.
(Click on chart to expand)
On the Weekly chart the Horizontal Overhead resistance is where there is the greatest probability for an increase in Supply from the longer term time frame investors and traders. This is around $26.00 per ounce. Should Silver start to move above 26.00 the path of least resistance will no longer be lower and that is when things will get very interesting for the Bulls.
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