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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