Silver’s Doing Exactly What It Was Likely to Do

Investorideas.com (www.investorideas.com
Newswire) As I warned my subscribers, silver was likely to form a
double top, with the second high slightly above the previous one.

That’s what’s taking place right now.

Breakout or Fakeout? The $51–$52 Question

Silver just jumped
above $50, meaning that it’s already above the first top. The
question now becomes:

How high is too high for the white metal?

Given the momentum and the breakout that we just saw (to new all-time
highs), and knowing silver’s tendency to form fake-breakouts, it
wouldn’t be surprising to see silver top at about $51 – $52
before surprising almost everyone and sliding.

This means that we might not have seen the top today just yet. It also
means that my previous comments on silver – and other markets
– remain up-to-date:

Probably forming a double-top. The second top is likely to be
slightly above yesterday’s one.

Here’s why:

Silver’s 2011 top was a double top. The second high was
slightly above the first one.

The second top formed in less than a week after the first top had
formed.

Silver’s 2008 top was also a double top. The second high was
slightly above the first one.

The second top formed in a bit more than one week after the first
top had formed.

Can 2008 and 2011 really tell us anything about what’s likely
to happen now? Even though both happened so long ago and the
geopolitical and economic environment is so different?

Of course. The fear and greed that make people react similarly to
similar price moves continue to work in the same way regardless of
geopolitics.

Besides, silver topped in a double-top manner in pretty much all
recent cases.

While silver’s long-term upside is enormous in my view
(and those that had bought silver for their retirement are likely to be extremely happy with the results), it still looks like it needs to decline significantly before
truly breaking outand soaring tens of dollars higher.

Speaking of silver’s
long-term upside, it’s clear not only
based on fundamentals, but also given silver’s very long-term technical picture.

Yes, silver is likely to decline along
with gold
and miners in the following weeks/months, but after that…

After that it’s likely to soar in an unprecedented manner.

Silver formed a very-long-term cup-and-handle pattern, with the 1980
– 2011 performance being the cup and the 2011-now part being the
handle.

Interestingly, the 2011 – now performance is a cup of its own
kind. We have a cup that’s actually a handle of the bigger
pattern.

This means that when we get this decline and the final handle is
formed, we’ll then be likely to get a spectacular rally based on
both patterns. How high could silver soar then? I don’t give you
the exact number right now, but $100 is on the lower end of the likely
values.

Again, a bigger decline is likely to take place earlier, and
today’s performance of mining stocks confirms that.

Caution Ahead: The Rally’s Final Stretch?

Gold, silver, and miners are up, but while gold and silver are up to
new highs, mining stocks are not – they are only testing their
Oct. 6 high – nothing more.

The miners are underperforming while silver is outperforming –
that’s a
classic behavior
that we see close to the tops.

Now, as I wrote earlier, we might have the final top this week or in
the week – at least in silver (and gold).

Will we get miners at new highs as well? That’s possible, but I
doubt that – please note that based on Friday’s close,
October was a down month for both: GDX and GDXJ.

In my view, this is the period when it’s dollars to the upside
and tens of dollars to the downside in case of the mining stocks.

And silver? It’s likely to soar, but not without declining
first.

Of course, the above is up-to-date at the moment of writing these
words, and the outlook can change if silver manages to successfully
confirm this breakout. I strongly suggest that you stay informed about
the latest news on the precious metals market right now, even if that
was not normally your focus area.

Thank you for reading my today’s free analysis. For more premium
insights, including trading details – I encourage you to
subscribe to my
Gold Trading Alerts.

Thank you.

Przemyslaw K. Radomski, CFA
Founder
Golden Meadow®

Check out the
Exploring Mining podcast
at Investorideas.com with host Cali Van Zant for the latest mining
stock news and insightful interviews with top industry experts

Latest episode: https://www.youtube.com/watch?v=KRLWHJdZuSE

Research mining stocks at Investorideas.com with our free mining stocks directory
at Investorideas.com

Sign up for free stock news alerts at Investorideas.com:

https://www.investorideas.com/Resources/Newsletter.asp

About Investorideas.com – Big Investing Ideas

Investorideas.com
is the go-to platform for big investing ideas. From breaking stock
news to top-rated investing podcasts, we cover it all.

Learn more about our news, PR and social media, podcast and content
services at Investorideas.com

https://www.investorideas.com/Investors/Services.asp

Follow us on X @investorideas @stocknewsbites
Follow us on
Facebook
https://www.facebook.com/Investorideas
Follow us on YouTube
https://www.youtube.com/c/Investorideas

Contact Investorideas.com
800 665 0411