• 24 hours Hawkish Fed Sends Gold Prices Crashing
  • 2 days Bezos Is Heading To Space This Sunday
  • 5 days El Salvador’s Surprise Bitcoin Move
  • 8 days Markets Unfazed As Inflation Hits 13-Year High
  • 9 days How the Token Economy is Disrupting Financial Markets
  • 11 days FBI Investigating 100 Types Of Ransomware Attacks
  • 13 days Fed Ends Corporate Credit Emergency Lending Program
  • 15 days AMC Becomes the Latest Winning Meme Stock After GameStop
  • 16 days The Real Reason Your 401k Has Been Lagging
  • 17 days China Lifts Cap On Births, Allows Three Children Per Couple
  • 19 days The Market Is Ripe For Another GameStop Saga
  • 22 days Senate Grills Big Banks Over Pandemic Opportunism
  • 23 days Cannabis Has A Major Cash Problem
  • 24 days Ransomware Netted Criminals $350M In 2020 Alone
  • 25 days Russia Is Taking On Google
  • 26 days Chinese Regulators Deal Another Big Blow To Bitcoin
  • 27 days Ohio Residents Brave Vaccine for Chance To Win $1M
  • 29 days Inflation Is Coming. Are You Prepared?
  • 30 days Travel Might Get Another Supersonic Disruption
  • 31 days The World Is Running Out Of 6 Key Resources
The Problem With Modern Monetary Theory

The Problem With Modern Monetary Theory

Modern monetary theory has been…

Billionaires Are Pushing Art To New Limits

Billionaires Are Pushing Art To New Limits

Welcome to Art Basel: The…

  1. Home
  2. Markets
  3. Other

This Suggests That Silver Will Soon Spike Significantly Higher

The silver price and the US Dollar/South African Rand exchange rate (USD/ZAR) have a very interesting relationship that goes back a long way.

Basically, in the long run, the two move in opposite directions. When the USD/ZAR rate is moving up, then the silver price is moving down, and vice versa. Furthermore, when the USS/ZAR rate is making a top, then a bottom in silver is normally very close (before or after the USD/ZAR peak).

Due to the nature of this relationship, I find that the USD/ZAR chart is often a leading indicator for a silver bottom as well as a silver rally.


Then – It signalled the bottom

Earlier this year, the USD/ZAR chart signalled the fact that the December 2015 low in silver was actually the bottom for the 5-year decline. This, from my February 2016 premium service (in italics):

Below, is a comparison showing the relationship between USD/ZAR peaks and silver bottoms:

USD/ZAR peaks and    silver bottoms
Larger Image

On the chart (from tradingview.com), I have drawn blue lines at the 2001, 2008 and potential Jan 2016 USD/ZAR peaks. One can see how close to these peaks the 2001, 2008 and potential Dec 2015 silver bottoms were.

Given, the look of the Jan 2016 candlestick; it is likely that the USD/ZAR chart has peaked.

If it has indeed peaked, then there is a very strong likelihood that the December 2015 bottom in silver is actually the bottom since the 2011 peak. It is interesting to note that there is a 7-year interval between the silver bottoms.


Now - it signals a rally similar to that of August 2010 – April 2011

Below is a USD/ZAR chart from 2004 to 2016 (from tradingview.com):

USD/ZAR 2004-2016 Chart
Larger Image

On the chart, I have marked two significant peaks (October 2008 and January 2016). Silver also made a significant bottom around the same time during both peaks. The USD/ZAR had a significant breakdown in July of 2010 as indicated. This was followed by a significant silver rally that really  took off around the end of August 2010.

The USD/ZAR chart recently had a similar breakdown as indicated. This tells me that silver will soon spike significantly higher. This fractal analysis of a previous article also suggests that silver is close to a significant spike.

Warm regards,

 


For more of this kind of analysis, you are welcome to subscribe to my premium service. I have also recently completed a Gold Mining Fractal Analysis Report as well as a Silver Fractal Analysis Report.

 

Back to homepage

Leave a comment

Leave a comment