Chartists predict that silver will top out somewhere near $640/oz. My calculations put the current leg of the silver rally to top out at $21-22. Here is the graphic that led me to that conclusion:
Something bugged me about this graphic, so I redrew it using a different starting point. That put the top past $21/oz. Which is right?
So I went back a little further to see what might be the start of the current rally.Is there a justification for using either starting point? This is what I found:
When you look at the data this way, you can see a cup and handle pattern that terminated very early in March, followed by a baseline rally that began mid March.
So, if you take the starting point at the right of the cup (first of March) this current leg might top out at 20-21. If you take the mid March starting point then the current rally should top out a few dollars higher.
Market sentiment is still pessimistic, meaning the current rally has further to go.
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