close icon

What Is Next for Beaten Down Silver?

Silver was hovering around the highs of $16 an ounce just a week ago, but suddenly fell by a dollar and is currently hesitating near the $15 mark. Could this sharp decline be predicted and if yes – how? We cannot tell you how others might have done it, but our way is not by anticipating economic news, nor is it by assuming the impact of geopolitical or any other kind of events. Instead, we prefer analyzing price charts from the perspective of the Elliott Wave Principle. This was the forecasting method we used in “Silver Seems to Be Running Out of Fuel” on March 22nd. Here is how the forecast looked like back then.
silver 22.3.16
As visible, the 4-hour chart of silver was showing a five-wave impulse to the upside from 13.64 to 16.13. According to the theory, every impulse is followed by a three-wave correction in the opposite direction. To us, that was more than enough of a reason to believe that the price of silver was likely to reverse to the south very soon. We thought that perhaps the bulls might have a little power left for another swing high near 16.20, but as the next chart will demonstrate, they turned out to be even weaker the expected.
silver 29.3.16
Almost immediately after the forecast was published, the bears took the wheel. Seven days later, they are still charge. This is another excellent example of the Wave principle’s ability to save traders money by warning them for an upcoming reversal before it is too late. However, there are signs that silver might regain positive bias for a while. The 30-minute chart explains why.
silver 29.3.16 30m

As the chart shows, the decline from 16.13 to 15.04 consists of five waves. So, same rules apply. Just as an impulse on the 4-hour chart is followed by a correction in the opposite direction, so is an impulse on a 30-minute chart. But this time the impulsive sequence points down, which means the three-wave retracement should be to the upside. The relative strength index is also supporting this claim, by showing the typical divergence between waves 3 and 5 of (A).
If this is the correct count, silver is supposed to start recovering in wave (B) soon. However, this is not the time to go long, because the bulls might get tired very soon and once they do, wave (C) should take the price of silver below 15.00.

What other markets are you interested in? Prepare yourself for whatever is coming. Order your on demand Elliott Wave analysis now or pre-order one of our 8 Premium Forecasts due out every Monday. Stay ahead of the news in any market with the Elliott Wave principle.

Stay informed with our newsletter

Latest Elliott Wave analysis on different topics delivered to you weekly.

Privacy policy
You may also like:

Silver Bears Discouraged by Fibonacci Encounter

We last wrote about silver in March 2019, when the precious metal was hovering slightly above $15. Our analysis of its 4-hour chart gave us plenty of reasons for optimism. And indeed, six months later in September the price reached $19.65. Currently, silver is trading near $17.75, up from $16.53, but still down from that…

Read More »

Gold ‘s Surge and US-Iran Have Little In Common

Gold climbed to a six-year high on rising tensions between the US and Iran following the assassination of Iranian General Qasem Soleimani. The safe-haven asset reached $1590 earlier today as #WorldWarThree started to emerge on Twitter. We hope WWIII remains just a hashtag. In the meantime, we are once again baffled by how the media…

Read More »

Gold Traders Better Off Ignoring the News

In our previous article about the precious metal readers saw how the Elliott Wave principle put us ahead of gold ‘s $72-decline from $1531 to $1459. In short, the hourly chart made us think a three-wave decline from $1555 was still in progress. Hence, the bears remained in charge and more weakness could be expected.…

Read More »

Explaining Gold ‘s Weakness With Elliott Wave Logic

Gold bulls suffered in four of the last five daily trading sessions. A week ago, on September 24th, the price of gold briefly exceeded $1535. Earlier today, it touched $1459 before recovering to $1466 as of this writing. In the meantime, global economic growth is slowing and several recession indicators are flashing red; In what…

Read More »

Famous Pattern Put Gold Traders Ahead of the Curve

Last week, gold finally broke out of the consolidation it has been locked in for almost a month. The price fell to $1400 before rising to $1453 on Friday, July 19th. But instead of maintaining the positive momentum, the bulls lost steam and allowed the bears to close the weekly session at $1425.66. Fortunately, a…

Read More »

Silver Looking for Support near $15 Mark

A little over a month ago, the price of silver was hovering around $16 following a strong rally from as low as $13.90 in November 2018. Many traders saw this 15% surge as a sign of even better things to come. Unfortunately for them, yesterday an ounce of silver was switching hands for about $15.…

Read More »

In Gold ‘s Elliott Wave Footsteps from 1200 to 1350

Gold bulls can be very pleased with their progress in 2019 so far. Three days ago, the precious metal climbed past $1346, bringing its total year-to-date return to 5.2%. Furthermore, gold is up 12.6% from its mid-November low at $1196. “Uncertainty” is once again the usual reason people use to explain gold’s surge. Trade war…

Read More »

More analyses