It is a metaphor, of course. We are not talking about the comic character, surfing throughout the universe at the speed of light. Unless he is also a trader, who shorted silver in the middle of July.
“We should not be surprised by prices around 16.00… maybe even lower.” This is the last sentence of an article, called “One Last Breath for Silver”, which we published on 12th July 2014. If you have been following silver for the last two months, you probably know that it is not there yet. However, it seems to be on its way. Now we will give you two charts of the price of silver. The first one shows silver as it was on 12th July. The second one demonstrates the development after the forecast.
As you can see, silver was trading slightly above 21.40 after a long month-and-a-half rally that began at 18.62. So what gave us the courage to express the opinion that silver should fall towards 16.00? As always – the Elliott Wave Principle. It gives us the opportunity to focus on the market itself, regardless of the external factors, which the “fundamental” majority is using. As you may have heard, in the markets the majority loses. So, instead of relying on mass opinions, we prefer analyzing the wave structure of the price action. A chart is all we needed, in order to prepare for what was coming in silver.
Recommended reading: We warned you about silver, remember?
“The price action looks like a simple zig-zag A-B-C, where wave B is a triangle. Triangles precede the final swing of the larger sequence. In this case it is wave C. Once it is finished, we will be expecting a strong reversal to the downside for silver.” That’s all. No demand and supply reports, no central banks’ reserves, no geopolitical risk safe havens. Just a chart. Now let’s see what happened to silver prices during the last couple of months.
Right after our forecast silver started a long journey to the south, leading prices to 17.80 so far. The wave analysis suggests for more weakness ahead, which means that the target of 16.00 is still on the table. So, anyone who caught this “wave” deserves to be called a “Silver Surfer”. And he must be very pleased.
Silver Surfer image by www.nomoremutants.com