Today, the U.S. dollar stands at 78.90, silver at $33.89 and gold at $1,733.50, so we got what we expected.
On Jan. 9, we posted the following chart, which compares the current silver "bubble" to the Nasdaq Bubble a decade ago:
(Click HERE for the entire article).
Now let's see where we are today.
Just like the Nasdaq, silver has set a lower/equal low, accompanied by a higher low of the MACD index, and has now rallied quite sharply:
Compare this to the Nasdaq:
An overlay of both charts shows us where we are today:
If we zoom in a bit:
If the pattern holds, we should be about halfway the "Bull trap," as many will view this as the Return to "normal."
If the pattern doesn't hold, and silver blasts through $40/oz, it's probably on it's way to the all-time high. In that case, the next big move would be to the upside, with potential targets of $70/oz and potentially triple digit silver prices.
As long as the pattern holds, I would be careful if silver hits $38/oz.
Willem Weytjens
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