Silver is currently showing strong upward momentum, distinguishing itself from gold, which remains largely range-bound. This divergence highlights the unique dynamics at play in the silver market. The key feature on the chart is a classic inverse head and shoulders pattern, marked with a blue rectangle on the right-hand side. This pattern is a well-known bullish reversal signal, suggesting further upside potential for silver.
What makes this setup even more compelling is the repetition of history. A similar inverse head and shoulders pattern emerged in mid-November, also near the same level. That formation led to a sharp rally, taking silver to the green resistance level. Given the technical similarities, the current pattern seems poised to follow a similar trajectory.
The breakout of the neckline, marked by the orange resistance, has already occurred, confirming the bullish sentiment. The next target is the green resistance zone, which previously capped gains in November. The technical landscape suggests a high probability of reaching this target, as the pattern aligns well with silver's ongoing upward trend.
This setup is one of the more reliable technical formations, and the odds strongly favor a continuation of silver's bullish momentum.