• 10 hours Lyft IPO: Get Ready For A Bumpy Ride
  • 13 hours Newmont Mining Teases Investors With Special Dividend
  • 16 hours Central Banks Double Down On Gold
  • 18 hours Don't Write Off Cryptocurrencies Just Yet
  • 1 day Trade In Counterfeit Goods Hits Half A Trillion Dollars
  • 2 days Tesla Struggles To Compete In European Market
  • 2 days China: The New King Of Caviar
  • 3 days Gold Mid-Tiers Rally On Fresh Earnings Reports
  • 3 days Can The British Pound Overcome Brexit?
  • 4 days Is A Gold Breakout Near?
  • 4 days Federal Reserve Downgrades U.S. Growth And Cuts Rate Hikes
  • 5 days Disney Beats Out Comcast In $71.3B Mega-Merger
  • 5 days The Feds Continue To Prop Up Equities Markets
  • 5 days Bejing's Sway In South China Sea Is Fading
  • 5 days Saudis Eye Billions As Stocks Get Emerging Market Boost
  • 6 days Airbnb In Acquisition Mode Ahead Of IPO
  • 6 days Gold Hangs At $1,300 Ahead Of Fed Meeting
  • 6 days Champagne Sales Slow As European Economic Worries Grow Louder
  • 6 days Putin Signs “Digital Iron Curtain” Into Law
  • 7 days Russian Metals Magnate Sues U.S. Over Sanctions
Tesla Struggles To Compete In European Market

Tesla Struggles To Compete In European Market

Tesla continues to catch the…

Trade In Counterfeit Goods Hits Half A Trillion Dollars

Trade In Counterfeit Goods Hits Half A Trillion Dollars

The counterfeit market has breached…

  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