This prolonged consolidation phase is now drawing renewed attention from market participants, particularly as global risk sentiment shifts and technical structures begin to take shape.
According to Apurva Sheth, Head of Market Perspectives and Research at SAMCO Securities, the recent price action has developed into a classic cup and handle structure, a technical pattern often watched closely by traders for breakout signals.
Sheth notes that this structure emerged as “every dip found support at the 50% retracement near 46 and every rally stalled around 54.”
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The technical setup, he explains, is now nearing a critical juncture. “The chart shows that bulls have come back with force,” Sheth observes, highlighting that the handle formation has nearly completed.
Notably, Sheth points out the upside potential based on the pattern’s height: “The height of the pattern suggests that silver has room to add roughly eight to nine dollars from the breakout point, which opens the path towards levels of $63–64/ounce.”
Prices are currently testing the upper boundary of the established range. A sustained close above the $54 level, according to him, would confirm a fresh breakout from this pattern.
While prices have not yet broken out decisively, the broader trend remains intact.
As per Sheth’s analysis, the formation of higher highs and higher lows continues to signal underlying strength. “Higher highs and higher lows indicate steady buying pressure on every correction. As long as prices stay above the $46 support zone, the structure stays strong and dips are likely to get absorbed quickly,” he said.
Adding further perspective to silver’s historical behaviour, Sheth remarks that “silver has already shown that it prefers trending moves after periods of rest.” This characteristic, combined with the current setup, suggests the metal could be preparing for the next leg of its uptrend.
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With prices hovering near key levels and technical indicators aligning, silver continues to attract close scrutiny from traders and analysts alike. Whether the breakout materialises remains to be seen, but as per Sheth’s reading, the conditions are beginning to resemble past setups that have led to significant directional moves.
(Disclaimer: Recommendations, suggestions, views and opinions given by the experts are their own. These do not represent the views of The Economic Times).
