First Majestic Silver About To Start A Monster Rally In 2018?
We said recently that Silver Investing May Become Very Profitable in 2018 primarily because the long term chart shows an extremely important event is about to take place: a breakout or breakdown out of a very long term triangle pattern. We shared the ‘latest and greatest’ long term chart last week in 35 Year Silver Chart Indicates Big Move In Silver About to Start.
The silver price may be signaling a major move is about to take place, as per our revised silver price forecast 2018, but silver miners are as flat as it can be. We wrote about this in Silver Miners Chart Signals “Time Is Not Ripe” Yet.
However, once the price of silver breaks out we expect silver miners to start trending strongly. In other words, we consider the current consolidation in silver miners the proverbial ‘stillness before the storm’.
How to play a silver breakout? Very simple, choosing one of the major silver mining pure plays. One such play is First Majestic Silver, a pure play silver miner with a market cap of $1.2B.
A month ago we identified a great chart setup in First Majestic Silver when we wrote: First Majestic Silver To Become A Multi-Bagger In 2018?
Note how, most likely, there is a rounded bottom which started in the summer of 2016, bottomed in January of this year, and is likely to set a series of higher lows in the next weeks and months. This is a textbook chart pattern, one that is very bullish.
This setup is still in play, and, interestingly, this stock, after breaking out a few weeks ago, is now rising above its long term trend (moving average). It is bumping into heavy resistance, right at a time when the price of silver is about to start trending, and, most likely, break out.
Simply said, if the price of silver breaks above $18, for 3 consecutive weeks, we believe First Majestic Silver will become a multi-bagger in a short period of time.
(Click on image to enlarge)
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