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 2^nd 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.

Silver $21.46

How far is 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?

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