Monster Silver Rally Brewing
On silver’s 1-year chart we can see that a fine large Double Bottom is completing. We already had the breakout on good volume from the 2nd trough of this Double Bottom in the middle of February, and it was this event that has (rightly) caused traders to pile into silver, although the price hasn’t moved much – yet. The better silver stocks, on the other hand, are already on fire, because the “writing is on the wall”. Right now the price is consolidating following the breakout in a fine tight Flag formation, from which upside breakout looks imminent.
(Click on images to enlarge)
How far is the next major uptrend in silver likely to carry? – to figure that out we turn now to the long-term 14-year chart, which shows silver’s entire bullmarket to date. On this chart we see that, despite the severity of the reaction of the past 3 years, silver never broke down from its long-term uptrend, which now looks set to reassert itself with a vengeance after a fine base pattern has formed at a classic juncture, in a zone of strong support just above the support line of the long-term uptrend. Volume indicators are positive, relative to price, and everything is in place for a monster uptrend to begin, with the giant blue arrow drawn on the chart designed to assist those of you with limited powers of imagination in grasping its potential magnitude – little wonder then that silver ETFs and stocks are such compelling investments here – their performance soon could put many tech stocks in the shade.
Speculating about the possible reasons for such a big uptrend is a complete waste of time – maybe John Kerry will succeed in starting WW3, who knows?
Analysis of 20 silver stocks analysis follows for subscribers…
Clive Maund is an English technical analyst, holding a diploma from the Society of Technical Analysts, Cambridge, England. He lives in Chile. Visit his subscription website at www.clivemaund.com. [You can subscribe here].
Disclaimer: The above represents the opinion and analysis of Clive Maund, based on data available to him, at the time of writing. Clive Maund's opinions are his own, and are not a recommendation or an offer to buy or sell securities.
Clive Maund is an independent analyst who receives no compensation of any kind from any groups, individuals or corporations mentioned in his reports. As trading and investing in any financial markets may involve serious risk of loss, Clive Maund recommends that you consult with a qualified investment advisor, one licensed by appropriate regulatory agencies in your legal jurisdiction and do your own due diligence and research when making any kind of a transaction with financial ramifications.
Although a qualified and experienced stockmarket analyst, Clive Maund is not a Registered Securities Advisor. Therefore Clive Maund’s opinions on the market and stocks can only be construed as a solicitation to buy and sell securities when they are subject to the prior approval and endorsement of a Registered Securities Advisor operating in accordance with the appropriate regulations in your area of jurisdiction.
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