Just as in the case of Gold (XAUSUD) analysis published previously; Silver (XAGUSD) seems to have formed a contracting triangle corrective pattern in wave 4 as indicated by the wave structure of the sideways price action in September and October and by the converging trendlines that connected the extremes of waves (a), (b), (c), (d) and (e).
What is most interesting is that Elliot Wave alternation guidelines were followed correctly. Wave 2 unfolded as a zigzag and retraced 78.6% of wave 1, while wave 4 unfolded as a triangle and retraced 50% of wave 3.
According to Elliot Wave Theory, triangle always precedes the final move of a sequence. And once a correction is completed, the price resumes in the direction of the major trend, which is bullish in this case.
The triangle correction has set up a potential Wave 5 rally in Silver, and the projected target is 61.8 Fibonacci extension (blue area) on the chart.
Price has broken the extreme of wave (d) of the triangle, so the pattern has been confirmed, and traders should be looking for buy opportunity in subsequent HL on the lower timeframe.
Thanks for reading!
Veejahbee.
What is most interesting is that Elliot Wave alternation guidelines were followed correctly. Wave 2 unfolded as a zigzag and retraced 78.6% of wave 1, while wave 4 unfolded as a triangle and retraced 50% of wave 3.
According to Elliot Wave Theory, triangle always precedes the final move of a sequence. And once a correction is completed, the price resumes in the direction of the major trend, which is bullish in this case.
The triangle correction has set up a potential Wave 5 rally in Silver, and the projected target is 61.8 Fibonacci extension (blue area) on the chart.
Price has broken the extreme of wave (d) of the triangle, so the pattern has been confirmed, and traders should be looking for buy opportunity in subsequent HL on the lower timeframe.
Thanks for reading!
Veejahbee.
