This does not look for precious metals. After yesterday’s strongly bearish observation on gold’s (GOLD) price chart as we wrote It’s Official: Gold Price Breaks Down we now see the silver miners breaking down as well.
The fact that silver miners are breaking down is an extremely important event because we consider them a leading indicator for the precious metals space. The proof is in the ‘pixel perfect’ pattern they have been moving into since early last year.
Today, silver miners started to move outside their pattern. That is very bearish, make no mistake. Not only is it bearish for miners, it also is for silver and the whole precious metals space.
We have followed silver closely since April, when we concluded that a new strong in silver and precious metals was coming. Without any doubt, it has been a sensational period, because it was very hard to forecast the direction the metals would go. With continous ups and downs, false breakouts and false breakdowns, it has been nerve-wrecking to say the least.
This is what we wrote:
- Early June: Silver Miners Confusing Bulls And Bears
- Mid-June: Silver Miners Facing Another Critical Test
- Early June: Silver Miners: Another Awesome Chart Setup
- May: Silver Price: 7th Breakout Attempt, Amazing Chart Setup
We always remained firm to our Silver Price Forecast 2017, and we were even on MarketWatch with our Silver Price Prediction when we said that mid-April was the top of the year for silver. It seems now that our forecast was spot-on again.
If silver miners (SIL) don’t get back in their triangle pattern in the coming days we believe they will test their early 2016 lows, which is a 50% drop from today’s levels. If that materializes, and they would set a higher low, it would be a huge buy opportunity!