Autochartist identified a Triangle breakout pattern on the 240-minute silver chart, portending a possible rally towards the $40 level once again. Silver futures have been range-bound in a large consolidation phase within this Triangle chart pattern, and this week's surge higher marks the first long term technical buy signal since the market broke through the $30 level several weeks ago.
The Triangle had been forming between the $32 and $35 per ounce price points, gradually narrowing to force the breakout near the apex. The pattern ranks high in all areas, with a Quality ranking of 7 bars. The breakout occurred on very strong 10-bar momentum, which underscores the potential for this move to achieve the projected price target.
The forecast range predicted by Autochartist calls for a minimum move to $35.78, which is equal with the top of the Triangle's initial starting point. Follow-through buying could carry silver to the top end of the range near $37.47 per ounce to complete the breakout. If the high end is exceeded, it will likely set up a longer term uptrend to eventually retest the $40 price level.
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