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Silver Price Forecast: Consolidation Phase or Bullish Uptrend Continuation?

By:
Bruce Powers
Published: May 8, 2023, 20:42 GMT+00:00

Silver's bullish behavior persists even as it moves into fifth week of consolidation.

Silver, FX Empire

In this article:

Silver Forecast Video for 09.05.23 by Bruce Powers

Silver continues to consolidate near trend highs, and it remains above near-term support at 24.47. The high of the current uptrend is at last week’s high of 26.12. An upside breakout and bull trend continuation triggers on a decisive rally above that high and is then confirmed on a daily close above it. The next higher targets for silver are then at 26.93 followed by 28.73.

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Potential Double Top Forming

There is a potential double top bearish reversal pattern forming in silver. This is a pattern that is not close to triggering just yet but can be watched to see if it follows through. Silver hit the first top at 26.07 a month ago and a second high last week at 26.12. A breakdown triggers on a decisive drop below 24.47. The target derived from the pattern is 22.82. That is very close to the 50% retracement of the latest upswing at 22.92. Notice that the 34-Day EMA (orange) line is close to the neckline of the potential double top. Therefore, a drop below the double top will also trigger a break below the 34-Day line.

Tight Consolidation Near Highs is Bullish

We have begun the fifth week that silver is consolidating in a tight range near trend highs. This is bullish behavior in general as price has remained above both the downtrend line (top of large declining parallel trend channel) and above the previous swing high at 24.62 from January. And it is staying strong and continuing to trade near trend highs. This, following a 32% advance in only 25 days. Of course, the rally is bullish but also the consolidation phase given that the retracement has been shallow having only completed a 23.6% Fibonacci retracement so far.

Symmetry in Silver Chart Shows 26.84 Target

Silver remains on track to eventually complete an AB=CD pattern at 26.84. That target matches the March 8, 2022, swing high at 26.93 (close enough). At that point the second leg up in the uptrend (CD) will match the advance in the first (AB) thereby reflecting symmetry or similarity between the two swings.

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About the Author

Bruce boasts over 20 years in financial markets, holding senior roles such as Head of Trading Strategy at Relentless 13 Capital and Corporate Advisor at Chronos Futures. A CMT® charter holder and MBA in Finance, he's a renowned analyst and media figure, appearing on 150+ TV business shows.

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