Silver May Have Seen This Pattern Before
Silver has rallied sharply since the fourth quarter began, and previous history may suggest the white metal has further upside.
Today, we’re considering a two-part pattern that occurred on the weekly chart in September 2010 (see below) and July 2020.
The first component is the break of a falling trendline. The second part is holding above a previous high before the trendline breakout. (Marked with the dotted horizontal line.)
Such price action may show when a period of weakness ends, followed by the onset of buying.
Fast forward to April 2023 and similar developments could be taking shape. There’s a falling trendline along the highs of May 2021 and March 2022. XAGUSD rallied through this resistance and paused. It’s now attempting to remain above the January high of $24.64.
You also have weak U.S. dollar and signs of the Federal Reserve nearing the end of its rate hikes. That macro backdrop could also embolden silver bulls.
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This content is for informational and educational purposes only. This is not a recommendation regarding any investment or investment strategy. Any opinions expressed herein are those of the author and do not represent the views or opinions of TradeStation or any of its affiliates.
Investing involves risks. Past performance, whether actual or indicated by historical tests of strategies, is no guarantee of future performance or success. There is a possibility that you may sustain a loss equal to or greater than your entire investment regardless of which asset class you trade (equities, options, futures, or digital assets); therefore, you should not invest or risk money that you cannot afford to lose. Before trading any asset class, first read the relevant risk disclosure statements on the Important Documents page, found here: https://www.tradestation.com/important-information.
Today, we’re considering a two-part pattern that occurred on the weekly chart in September 2010 (see below) and July 2020.
The first component is the break of a falling trendline. The second part is holding above a previous high before the trendline breakout. (Marked with the dotted horizontal line.)
Such price action may show when a period of weakness ends, followed by the onset of buying.
Fast forward to April 2023 and similar developments could be taking shape. There’s a falling trendline along the highs of May 2021 and March 2022. XAGUSD rallied through this resistance and paused. It’s now attempting to remain above the January high of $24.64.
You also have weak U.S. dollar and signs of the Federal Reserve nearing the end of its rate hikes. That macro backdrop could also embolden silver bulls.
TradeStation has, for decades, advanced the trading industry, providing access to stocks, options, futures and cryptocurrencies. See our Overview for more.
Important Information
TradeStation Securities, Inc., TradeStation Crypto, Inc., and TradeStation Technologies, Inc. are each wholly owned subsidiaries of TradeStation Group, Inc., all operating, and providing products and services, under the TradeStation brand and trademark. TradeStation Crypto, Inc. offers to self-directed investors and traders cryptocurrency brokerage services. It is neither licensed with the SEC or the CFTC nor is it a Member of NFA. When applying for, or purchasing, accounts, subscriptions, products, and services, it is important that you know which company you will be dealing with. Please click here for further important information explaining what this means.
This content is for informational and educational purposes only. This is not a recommendation regarding any investment or investment strategy. Any opinions expressed herein are those of the author and do not represent the views or opinions of TradeStation or any of its affiliates.
Investing involves risks. Past performance, whether actual or indicated by historical tests of strategies, is no guarantee of future performance or success. There is a possibility that you may sustain a loss equal to or greater than your entire investment regardless of which asset class you trade (equities, options, futures, or digital assets); therefore, you should not invest or risk money that you cannot afford to lose. Before trading any asset class, first read the relevant risk disclosure statements on the Important Documents page, found here: https://www.tradestation.com/important-information.
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