Silver Price Forecast: Higher Silver Prices for Many Years to Come
In a previous article, Moolman highlighted how a head-and-shoulders bottoming pattern on the silver chart suggested that the silver rally since the beginning of 2016 is likely to continue. This pattern has now matured nicely, thanks to the retrace to the breakout area.
On the chart in the article the breakout is highlighted, as well as the retrace to it. Interestingly, there is now a flag formation. A breakout at the top of the flag will be the beginning of an explosive rally. There is still a possibility of a return to the retrace area before that happens.
The next leg up will be far more intense than the rally since the beginning of the year, because the pattern is at the trigger point of a larger pattern on the silver chart.
The current season is ideal for silver and gold rallies, and this increases the likelihood that the above patterns will resolve soon. We are also in stock market crash season, which could be the greatest driver for the coming silver rally, since significant nominal peaks in the silver price tend to come after significant nominal peaks in the Dow.
The two most significant nominal peaks of the Dow were in 1929 and 1973. Silver made a significant peak in 1935, about six years after the Dow’s major peak in 1929. Again, in 1980, silver made a significant peak, about seven years after the Dow’s major peak in 1973.
If the Dow is currently forming a significant top, we can expect a major peak in silver towards the end of this decade, to early next decade. This means we are likely to have rising silver prices for many years to come.