- While hedge funds are badly cornered by the frenzy of the GameStop individual investors, bears in silver market could hardly face the similar risk.
SINGAPORE: Spot silver may rise into a range of $32.90-39.86 per ounce over the next three months, as suggested by its wave pattern and a projection analysis.
The metal is riding on a wave C from $21.64, which is the third wave of a three-wave cycle from the March 18, 2020 low of $11.6177.
This wave may either end around $32.90, its 61.8% projection level, or extend to $39.86, the 100% projection level.
Silver seems to have gained a lot of momentum from Jan. 28 low of $24.84, surged more than 15% since then. This momentum has easily pushed the price above a key resistance at $28.60, the 38.2% projection level of the wave C.
The wave C is highly unlikely to end around $28.60. The next resistance will be at $30.75, a break above which could lead to a gain to $32.90.
On a long-term weekly chart, the current rally seems to be a resumption of the previous uptrend from the 1991 low of $3.51, as they have a strong mathematical relation.
The current trend is presumed to be riding on a wave C from $11.6177, which is about to break a resistance at $29.1897 and travel towards $34.62.
Eventually, this wave could extend into the range of $46.76-$57.62. It seems that the GameStop effect has indeed expanded into the silver market.
However, it must be noted that stock and silver markets are two completely different worlds, each equipped with different trading mechanism.
While hedge funds are badly cornered by the frenzy of the GameStop individual investors, bears in silver market could hardly face the similar risk.
Even though silver could achieve 40% to 100% gains over the next few months, it may never catch up with the pace of GameStop.
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