Best of the Week
Most Popular
1. Investing in a Bubble Mania Stock Market Trending Towards Financial Crisis 2.0 CRASH! - 9th Sep 21
2.Tech Stocks Bubble Valuations 2000 vs 2021 - 25th Sep 21
3.Stock Market FOMO Going into Crash Season - 8th Oct 21
4.Stock Market FOMO Hits September Brick Wall - Evergrande China's Lehman's Moment - 22nd Sep 21
5.Crypto Bubble BURSTS! BTC, ETH, XRP CRASH! NiceHash Seizes Funds on Account Halting ALL Withdrawals! - 19th May 21
6.How to Protect Your Self From a Stock Market CRASH / Bear Market? - 14th Oct 21
7.AI Stocks Portfolio Buying and Selling Levels Going Into Market Correction - 11th Oct 21
8.Why Silver Price Could Crash by 20%! - 5th Oct 21
9.Powell: Inflation Might Not Be Transitory, After All - 3rd Oct 21
10.Global Stock Markets Topped 60 Days Before the US Stocks Peaked - 23rd Sep 21
Last 7 days
Chinese Tech Stocks CCP Paranoia and Best AI Tech Stocks ETF - 26th Oct 21
Food Prices & Farm Inputs Getting Hard to Stomach - 26th Oct 21
Has Zillow’s Collapse Signaled A Warning For The Capital Markets? - 26th Oct 21
Dave Antrobus Welcomes Caribou to Award-Winning Group Inc & Co - 26th Oct 21
Stock Market New Intermediate uptrend - 26th Oct 21
Investing in Crypto Currencies With Both Eyes WIDE OPEN! - 25th Oct 21
Is Bitcoin a Better Inflation Hedge Than Gold? - 25th Oct 21
S&P 500 Stirs the Gold Pot - 25th Oct 21
Stock Market Against Bond Market Odds - 25th Oct 21
Inflation Consequences for the Stock Market, FED Balance Sheet - 24th Oct 21
To Be or Not to Be: How the Evergrande Crisis Can Affect Gold Price - 24th Oct 21
During a Market Mania, "no prudent professional is perceived to add value" - 24th Oct 21
Stock Market S&P500 Rallies Above $4400 – May Attempt To Advance To $4750~$4800 - 24th Oct 21
Inflation and the Crazy Crypto Markets - 23rd Oct 21
Easy PC Upgrades with Motherboard Combos - Overclockers UK Unboxing - MB, Memory and Ryzen 5600x CPU - 23rd Oct 21
Gold Mining Stocks Q3 2021 - 23rd Oct 21
Gold calmly continues cobbling its Handle, Miners lay in wait - 23rd Oct 21
US Economy Has Been in an Economic Depression Since 2008 - 22nd Oct 21
Extreme Ratios Point to Gold and Silver Price Readjustments - 22nd Oct 21
Bitcoin $100K or Ethereum $10K—which happens first? - 22nd Oct 21
This Isn’t Sci-Fi: How AI Is About To Disrupt This $11 Trillion Industry - 22nd Oct 21
Ravencoin RVN About to EXPLODE to NEW HIGHS! Last Chance to Buy Before it goes to the MOON! - 21st Oct 21
Stock Market Animal Spirits Returning - 21st Oct 21
Inflation Advances, and So Does Gold — Except That It Doesn’t - 21st Oct 21
Why A.I. Is About To Trigger The Next Great Medical Breakthrough - 21st Oct 21
Gold Price Slowly Going Nowhere - 20th Oct 21
Shocking Numbers Show Government Crowding Out Real Economy - 20th Oct 21
Crude Oil Is in the Fast Lane, But Where Is It Going? - 20th Oct 21
3 Tech Stocks That Could Change The World - 20th Oct 21
Best AI Tech Stocks ETF and Investment Trusts - 19th Oct 21
Gold Mining Stocks: Will Investors Dump the Laggards? - 19th Oct 21
The Most Exciting Medical Breakthrough Of The Decade? - 19th Oct 21
Prices Rising as New Dangers Point to Hard Assets - 19th Oct 21
It’s not just Copper; GYX indicated cyclical the whole time - 19th Oct 21
Chinese Tech Stocks CCP Paranoia, VIES - Variable Interest Entities - 19th Oct 21
Inflation Peaked Again, Right? - 19th Oct 21
Gold Stocks Bouncing Hard - 19th Oct 21
Stock Market New Intermediate Bottom Forming? - 19th Oct 21
Beware, Gold Bulls — That’s the Beginning of the End - 18th Oct 21
Gold Price Flag Suggests A Big Rally May Start Soon - 18th Oct 21
Inflation Or Deflation – End Result Is Still Depression - 18th Oct 21
A.I. Breakthrough Could Disrupt the $11 Trillion Medical Sector - 18th Oct 21
US Economy and Stock Market Addicted to Deficit Spending - 17th Oct 21
The Gold Price And Inflation - 17th Oct 21
Went Long the Crude Oil? Beware of the Headwinds Ahead… - 17th Oct 21
Watch These Next-gen Cloud Computing Stocks - 17th Oct 21
Overclockers UK Custom Built PC 1 YEAR Use Review Verdict - Does it Still Work? - 16th Oct 21
Altonville Mine Tours Maze at Alton Towers Scarefest 2021 - 16th Oct 21

Market Oracle FREE Newsletter

How to Protect your Wealth by Investing in AI Tech Stocks

Silver Prices To Benefit from the Golden Cross

Commodities / Gold and Silver 2012 Oct 02, 2012 - 03:52 AM GMT

By: Bob_Kirtley


Best Financial Markets Analysis ArticleThe anticipation and advent of QE3 has filled the precious metals market champions with considerable optimism. Gold and silver have both steadily, but firmly moved to higher ground.

Taking a quick look at the chart we can glean a few simple trend changes. The first one is that silver’s downtrend that has been evident for the last 15 months or so, has been well and truly broken with silver rallying from around $26.00 to close today at $34.95. We would also draw your attention to the 50dma which is in the process of swinging through the 200dma in an upward movement, thus forming what is commonly known as a golden crossover. This recent rally and the golden crossover suggests that silver prices are going higher and are usually positive for silver. The canary in the coal mine is however, the position of the technical indicators, which suggest that silver is now overbought and as such should experience a pull back or at least a short period of consolidation. The RSI, MACD and the STO look to have peaked and are now heading south.

Overall we expect silver prices to continue in this multi-year bull market for precious metals and to set new all-time highs in the near to medium term. A $50.00 price tag before the end of the year is a real stretch; however, it is not impossible. The easing of monetary policy is now the order of day for the major nations who are faced with rising unemployment and stagnating economies. We see stagnation as a real problem going forward, without economic activity and growth, the tax receipts will be a lot lower than governments are anticipating and a fall in revenue is something that will give them nightmares. Should this period of stagnation persist and if the inflation monster was to raise its ugly head, then we would have to endure a period of stagflation which is really the worst of both worlds.

We would also draw your attention to another negative in that the overall sentiment would appear to be flat, as the general public remains disinterested and oblivious to the on-going debasement of their currency. This lack of interest is understandable as the same public is pre-occupied with a myriad of other issues that are far closer to home. Employment and future job prospects take center stage, followed by rising food and gasoline costs.

In the long term this is bullish for silver as when the public at large realize just what is going on they will move on mass into the precious metals sector causing an enormous bubble. A similar thing happened back in the eighties when silver and gold entered into the mania phase of the bull market. Will it be different this time you ask? Oh yes it will. There are many more market participants now than there was then so the upward pressure on prices will many times greater and prices will go through the ceiling.

Just to re-cap, on July 5th 2012, we penned an article entitled: ‘The Next Time Silver Crosses $30.00 will be the Last Time’ on that day silver was languishing at $27.67 as the summer doldrums offered little in the way of positive action. So, with silver prices now trading above $30.00 we have our necks well and truly on the chopping block. A lot can happen to take silver back down again and I guess our biggest worry would be interference from the regulators in that they can alter the margin requirements. This would cause some of the speculators to dispose of some of their holdings and thus put downward pressure on silver prices. If this were to occur we can only hope that the selling would be short lived and normal service would be resumed, as they say.

In the July article we also wrote the following; to conclude we politely suggest that you accumulate as and when you can and that you do not sell any of your physical silver bars or coins, you might be just offering someone else a real bargain. We hope that you did manage to ignore the naysayers and that you continued to buy throughout the summer. We are quietly confident the silver prices are headed are much, much higher and that we will all be rewarded for patiently accumulating physical silver.

Having recognized that the stocks were underperforming the metals, we switched our focus to trading options in order to get some leverage to the gyrations in the precious metals sector. This is not a strategy for the fainthearted, neither is it to be feared if you adopt a disciplined and conservative approach to each trade. The old adage still applies here that you should never fall in love with a trade, no matter how confident you are of it being a rip roaring success.

Stay positive, think precious metals, and avoid the folding stuff.

So if we have stimulated your interest then please feel free to add your comments as they help to stimulate and widen the debate, thanks.

Have a good one.

Bob Kirtley

To stay updated on our market commentary, which gold stocks we are buying and why, please subscribe to The Gold Prices Newsletter, completely FREE of charge. Simply click here and enter your email address. Winners of the GoldDrivers Stock Picking Competition 200

DISCLAIMER : Gold Prices makes no guarantee or warranty on the accuracy or completeness of the data provided on this site. Nothing contained herein is intended or shall be deemed to be investment advice, implied or otherwise. This website represents our views and nothing more than that. Always consult your registered advisor to assist you with your investments. We accept no liability for any loss arising from the use of the data contained on this website. We may or may not hold a position in these securities at any given time and reserve the right to buy and sell as we think fit.

Bob Kirtley Archive

© 2005-2019 - The Market Oracle is a FREE Daily Financial Markets Analysis & Forecasting online publication.

Post Comment

Only logged in users are allowed to post comments. Register/ Log in