The biggest silver news story of the last week has been the metal's much-needed rebound, and that could kick off a double-digit rally to close 2017…
According to Money Morning Resource Specialist Peter Krauth, silver could gain another 27.8% during Q4 2017. And silver's price action over the last week is a sign the rally is just about to begin.
Although silver prices were largely flat last week, they shot up 0.9% to a one-week high of $16.79 on Friday, Oct. 6. This gave the metal a weekly gain of 0.6% – its first weekly gain in a month.
Investors have been embracing silver despite the dollar getting stronger. That's because the dollar's rally appears to be ending after the currency fell back below an important level…
After bottoming at a two-and-a-half-year low of 91.35 on Sept. 8, the U.S. Dollar Index (DXY) – which measures the dollar against currencies like the euro and the pound – has rallied back to 93.25. It even touched the 94 level for the first time since July.
Since silver is priced in the dollar, a rising dollar tends to lead to lower silver prices. That's because any rise in the dollar makes silver more expensive for users of other currencies, which lowers the demand for silver, which lowers its price.
But the dollar's climb from 93.08 to 93.80 last week, combined with silver's 0.7% gain, indicates silver investors don't expect the dollar's strength to last much longer.
This is why Peter – a 20-year veteran of the silver market – thinks the price of silver will run much higher before 2018…
The DXY couldn't maintain above the 94 level last Thursday, indicating that may be a resistance level that could cap the dollar's gains the rest of the year.
"After poking above the 94 level, the DXY has pulled back below 93.80," Peter said. "I believe that, after the dollar's gains of the last month, it could now flatten."
Today, we're going to show you Peter's bold silver price targets for Q4 2017, one of which indicates a 27.8% gain before the end of the year.
First, let's take a closer look at silver's important rebound last week…
Here's the Silver News That Boosted Prices 0.6% Last Week
After settling at $16.68 on Friday, Sept. 29, silver prices opened lower near $16.60 on Monday, Oct. 2. The metal traded in the narrow $16.60-$16.65 range for most of the session, eventually settling at $16.65 for a small 0.2% loss.
Tuesday was uneventful, as both silver and the dollar traded mostly flat the entire session. As the DXY barely moved from 93.56 to 93.57 on Tuesday, the silver price saw no gain either, closing the day at $16.65.
On Wednesday, Oct. 4, silver fell despite the DXY also trending lower throughout the day. After reaching a high of $16.84 in morning trading, silver prices declined from there as the dollar dropped from 93.57 to 93.46. The metal settled the day 0.2% lower at $16.62.
This chart shows the DXY's performance since Wednesday, Oct. 4…
Silver showed more resilience in the face of a rallying dollar on Thursday. The DXY climbed to 93.96 by that session's close, touching a more than two-month high of 94 during intraday trading. Still, the price of silver managed to settle at $16.64 for a small gain of 0.1%.
This was a major sign of bullishness for silver prices that's led to consistent gains since then…
The metal shot higher on Friday, Oct. 6, as the DXY declined from 93.96 to 93.80. After opening flat at $16.64, prices briefly cratered to $16.34 around 10 a.m. before surging back toward $16.80. They eventually closed at $16.79, marking a 0.9% gain for the day and 0.6% rise for the week.
Urgent: Executive Editor Bill Patalon just saw something on his precious metals charts he's only seen twice in 20 years. He calls it the "Halley's Comet of investing" – and it could lead to windfall profits. Read more…
The silver price's rebound has continued into this week as the dollar retreats from the 94 level. Yesterday (Monday, Oct. 9), silver opened sharply higher at $16.95 and steadied at that level for most of the session. Prices closed at $16.97 for a gain of 1.1%, while the DXY fell from 93.80 to 93.72.
And the silver price today (Tuesday, Oct. 10) is on track for its highest close since Sept. 20. The metal is currently up 1.4% and trading at $17.22.
As Peter told Money Morning Members in this week's gold update, the 94 level appears to be the ceiling for the DXY right now. In other words, its inability to stay above that level since touching it last Thursday means the dollar's rally is likely coming to an end.
But the dollar isn't the only silver price factor we're looking at.
One burgeoning industry – whose total revenue grew 20.8% during the first half of 2017 – is expected to boost silver demand in 2018.
That will inevitably lift prices higher…