Silver… Away!

The monthly chart of the silver price shows a break through the long-term resistance zone and a tick to an 8 year high. Suspect underpinning though it may seemingly* have (#silversqueeze) a straight TA view is positive and was positive last week. From Friday morning’s NFTRH update…

“A final thought; when looking at the silver price simply as a TA this is completely viable in its own right because the silver price held its up-trending SMA 50 and as such a successful break through resistance and a new high could easily bring on $xx [omitted] eventually.”

So with the crazy hype behind it, we have two upside targets in play. But that is just for the near-term. I don’t know where the silver price will stop. It could be incomprehensibly high but probably not. Where ever it stops, the aftermath will not be pretty or the volatility will be epic.

Now, on to some macro work, if the burst in silver is causing the Gold/Silver ratio to do this…

gold silver ratio

…and the US Dollar is doing this…

us dollar

…we ask again, can the silver bugs alter the macro?

The break in silver, as off the hook as it is thus far, is 100% in line with the macro view that had the recent pause in inflation expectations and associated markets as just that, a pause, and not the end of the inflationary reflation trades. With other markets jumping silver’s train (you know, the Silver Bullet) if we had never heard of #silversqueeze, the move would be making much sense in its own right.

The outlier? USD has not gotten the memo yet. Very curious, and it’s a small caveat at the moment because the Gold/Silver ratio and USD ride with each other in this macro situation, both to the inflationary upside and the deflationary downside. USD is still in a little bounce pattern below thick resistance, but in an overall bearish trend.

* You know, it occurs to me that if the conspiracy theorists are correct and a cabal of banks really does control the silver price, dem boyz may just be sayin’ “let’s give dem bugz what dey want cuz we outta head of it anyway. We always winnin’, duh, and dem trends was up anyway.”

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