By Vishal Dalvi, CMT
1/ Silver Daily Chart
2/ Silver Weekly Chart
3/ Silver Monthly Chart
4/ HANGSENG Monthly Chart
5/ HANGSENG Weekly Chart
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1/
Silver Daily Chart
Silver is showing some interesting fractal pattern with Cup and Saucer pattern formation on multiple timeframes.
Past performance is not indicative of future results
The daily chart shows a cup and saucer formation on Daily Chart. Prices haven broken out above $26 and taking support at that level now, which was initially offering strong resistance.
2/
Past performance is not indicative of future results
The second chart shows a cup and saucer pattern formed on Weekly chart. This pattern has taken nearly 11 years for formation and prices have already broken out the pattern and are now retesting support levels.
The most important question is whether these patterns have worked well in the past for Silver.
3/
Silver Monthly Chart
Past performance is not indicative of future results
Monthly chart shows that Silver has seen two big Bull markets, first from year 1973-1980 and the second one from year 2006-2012. Interestingly both the bull markets are preceded with long term cup and saucer pattern formations. Will history repeat again? A huge upside waits in Silver if it does.
4/
HANGSENG Monthly Chart
Past performance is not indicative of future results
China has been a strong underperformer in Emerging Markets and the Monthly chart of HangSeng Index shows it clearly. Prices are currently hovering around the same levels as in the year 2000, offering very minimal returns to a Long Term investor. The monthly RSI of 26 period made a lowest reading of around 32.00 in a capitulation move in October 2022. Historically I have seen that a monthly RSI reading below 35.00 has made some long-term bottoms for major Equity Indices, once some positive price confirmations are seen.
5/
HANGSENG Weekly Chart
Past performance is not indicative of future results
To see if there are some early signs of reversal and a possible revival in the Market, let’s look at the Weekly chart below. A sharp reversal from the oversold October 2022 levels was followed by a retest of the same low in Jan 2024. A bounce from the same level shows a strong possibility that a long-term Double Bottom pattern is in place. I like Double bottom formation pattern where both the bottoms are made with significant Candlestick pattern as it adds to the conviction. The pattern is also accompanied with Positive Divergence on momentum indicators RSI as well as MACD on monthly as well as weekly chart. Though structurally long term trend still remains down, but the price formation discussed above are giving early signals that the worst may be over. We have already made a Higher Low structure after the August 2024 lows of 16647 and a weekly close above 19640, would confirm a start of an uptrend based on Dow Theory.
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Originally posted 2nd September 2024
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