Silver Price Forecasts & Predictions

Silver has definitely been in the spotlight lately, namely due to the incredible #silversqueeze rally. But as of right now, there is one detail that’s pointing to silver’s next movement.

Gold moved higher yesterday (Feb. 23) and so did the rest of the precious metals sector. But as you will see below, this didn’t really change anything. And there’s one detail that actually perfectly fits this kind of movement. Let’s take look at the charts, starting with the key one – and no, it’s not the one featuring gold.

Figure 1

Despite yesterday’s (quite sharp for a daily move) upswing, the breakdown below the neck level of the broad head-and-shoulders remains intact. It wasn’t invalidated. Consequently, all its bearish implications remain up-to-date.

Having said that, let’s move to the detail that actually fits what happened yesterday (and so far today). Namely, silver is going through a triangle-vertex-based reversal at the moment.

Figure 2

Indeed, after moving slightly above yesterday’s intraday high in today’s overnight trading, silver moved back down. The move lower is not yet super significant, but given the reversal point, it could just be the beginning. Remember the triangle-vertex-based reversal at the beginning of the year? Back then, practically nobody wanted to believe that silver and the precious metals market was topping at that time. It was the truth, though. Gold and mining stocks were never higher since that time and the same thing would have most likely happened to silver if it wasn’t the #silversqueeze popularity that gave it its most recent boost...

A brewing silver short squeeze has been hot in the news recently. On the heels of the Gamestop (GME) short squeeze which sent the price of the troubled videogame retailer higher by nearly 2,000% in six weeks, the Wall Street Bets Reddit group has now turned its attention to the silver market via the Wall Street Silver forum. With a membership of 32,600 investors and growing, there certainly appears to be some firepower behind the growing possibility of a short squeeze in the physical silver market.

High Premiums for Silver

Investors are choosing physical bars and coins, as well as ETF’s, in order to attempt to squeeze the major wall street banks which are short silver on the New York COMEX futures exchange. As evidence, we note that most major online retailers are experiencing shipment delays of several weeks, and premiums on coins and bars are running 30% - 40% above the spot price of silver! That is an incredible premium to be paying for physical delivery of silver.

Unless one currently owns no physical silver whatsoever, in which case the establishment of a core position is essential, we do not recommend paying such high premiums to accumulate the physical metal. Other ways to acquire silver have thus become popular, such as the Sprott Physical Silver Trust (PSLV), which has witnessed its highest all-time monthly volume as of February 22:

What will be the result of this developing short squeeze?

While silver rising back to $50 again (the 2011 peak) and possibly beyond may fit in with our long-term expectations, let us focus on the intermediate-term projection for the pending squeeze that we can calculate based on observable data. For that, we turn to the charts.

Silver Price Forecast

Spot...