Silver: Wild Swings In A Wide Range, Long Term Still Bullish
Investors with exposure to the silver market have been anxiously asking us whether silver will ever move higher. Our answer is that we stick to our silver price forecast, which says that the US dollar ultimately has to set up a top in the not too distant future. This would be the fuel needed for silver to move aggressively higher.
It has been a tough ride for silver investors. Admittedly, the price action in silver has been disturbing because of the wild swings. Also, our US dollar forecast will work out eventually, just not immediately. In other words, it is important to stomach the silver swings for longer until silver starts a trend.
As seen on the most basic silver price chart, even without our annotations, it is clear how silver has been in a trend-less state for four full months now. Up until this point, it has been experiencing a violent consolidation.
Whenever it feels uncertain and whenever there is a consolidation, it is important to zoom out to see the big picture. The chart that helps us understand the big picture is the monthly silver chart, as shown below. The monthly chart, contrary to the daily chart, has a very bullish setup. It is the type of chart that makes us happy.
The monthly silver chart suggests that even a silver spot price of $16/oz would not cause any damage to silver’s long-term profile.
We do acknowledge that we are bullish on silver and have been for a while now, and that our bullish sentiment did not translate into higher silver prices. We also have to acknowledge that the market has not been creating any trends since November of 2021. For one full year, markets have either been in a downtrend or consolidating. Any uptrend in any market has been short-lived at best and violently sold worst case.
The reason for silver’s inability to move higher is the US dollar. It's as simple as that. We must wait for the US dollar to find a top which, if and when it happens, will light a fire in the silver market.
Sooner or later, our silver call will deliver. Between now and then, it's important to be patient and seize your silver position(s) to be able to mentally disconnect from your silver holding(s).
More By This Author:
The Market Will Not Move 50% Lower Contrary To What The Gurus Are Telling You
Silver: A Strongly Bullish Long Term Setup In Its Leading Indicator
Bitcoin: The 5 Year Bull Market Trendline That Will Be Critical In 2023
We continue to monitor silver in our premium services, very closely even. In our Momentum ...
more
Comments
