Best of the Week
Most Popular
1. Crude Oil Price Trend Forecast - Saudi's Want $100 for ARAMCO Stock IPO - Nadeem_Walayat
2.Gold Price Focusing on May Cycle Bottom - Jim_Curry
3.Silver, silver, and silver! There’s More Than Silver, People! - P_Radomski_CFA
4.Is the Malaysian Economy a Potemkin Village - Sam_Chee_Kong
5.Stock Market Study Shows Why You Shouldn’t “Sell in May and Go Away” - Troy_Bombardia
6.A Big Stock Market Shock is About to Start - Martin C
7.A Long Term Gold Very Unpopular View - Rambus_Chartology
8.Stock Market “Sell in May and go away” Study When Stocks Are Down YTD - Troy_Bombardia
9.Global Currency RESET Challenge: Ultimate Twist - Jim_Willie_CB
10.The Coming Silver Supply Crunch Is Worse Than You Know - Jeff Clark
Last 7 days
What to Expect at a Critical Stock Market Point: End of a Wave 2 Rally - 25th May 18
Merlin Passes Top Tips for Buying and Using Premium vs Standard, Theme Parks UK - 25th May 18
Trump “Victories” on Trade are Anything But - 25th May 18
Crude Oil: It’s Here! - 25th May 18
Stock Market Distribution Pattern Revealed - 25th May 18
Stock Market Topping - Everything Looks Rosy at the End of a Trend! - 25th May 18
Trump Puts North Korea Nuclear WAR Back on Track as Plans for Nobel Peace Prize Evaporate - 25th May 18
Insane EU GDPR SCAM Triggers Mass Email Spam Attacks! - 24th May 18
Stock Market Higher Again, but Still No Breakout - 24th May 18
Study: Slowing Global Economic Growth IS NOT Bearish for U.S. Stocks - 24th May 18
What if This Week’s Rally in Gold is Already Over? - 24th May 18
EUR/USD – Reward for Bears - 24th May 18
5 Terrible Trading Mistakes That Rookie Investors Keep Making - 24th May 18
More Clarity for the Short Term for Bitcoin Price - 22nd May 18
Study: A Rising and Strong U.S. Dollar Isn’t Consistently Bearish for the Stock Market - 22nd May 18
Gold, Silver & US Dollar Updates with Review of Latest COTS - 22nd May 18
Upside DOW Stock Market Breakout May Be Just the Beginning - 22nd May 18
5 Reasons Why Forex Trading Is Becoming Such A Big Deal In SA - 22nd May 18
Fibonacci And Elliot Wave Predict Stock Market Breakout Highs - 21st May 18
Stock Market Ideal Cycle Low Near - 21st May 18
5 Effects Of Currency Fluctuations On The Economy - 21st May 18
Financial Conditions are Still too Easy for the Stocks Bull Market to End - 21st May 18
US Stock Market Elliott Wave Predictions for 2018 and Beyond - 20th May 18
Are You Still Fearful of Cryptos? - 20th May 18
US Stocks - Why I am Short-term Bearish, Medium-term Bullish - 20th May 18
Looking for a Turn in Gold Price - 20th May 18
GDX Gold Mining Stock Fundamentals 2018 - 19th May 18
Semiconductor Stock Market Canaries: Chirp, Warble… Soon a Croak and Silence? - 19th May 18
Three Drivers of Gold Price - 18th May 18
Gold Market in First Tertile of 2018 - 18th May 18

Market Oracle FREE Newsletter

Trading Lessons

Silver: Train Leaving Station Soon!

Commodities / Gold and Silver 2017 May 18, 2017 - 03:19 PM GMT

By: Gary_Tanashian

Commodities

Silver prices are rising along the bottom of a 20 year log scale trend channel (shown later). There are no guarantees in a manipulated paper market, such as COMEX silver, but it is possible that silver prices will collapse further, or more likely, move substantially higher, sooner rather than later.


Silver prices COULD fall from their current level of $16 – $17 to under $10. Other events that COULD occur include:

You could win the Powerball Lottery.

The U.S. congress could balance the budget and reduce debt.

The Federal Reserve could apologize for destroying the dollar.

President Putin and Hillary could sing “Kumbaya” together.

The Middle-East could ascend into a century of peace.

And it is possible that silver prices could drop under $10.

But realistically, we know:

  1. The Federal Reserve has devalued the dollar for over a century and is openly advocating for at least 2% inflation – more devaluation. Expect continuing declines in the purchasing power of the dollar.
  2. The U.S. congress, the President, the military, thousands of military contractors, the medical/health/sick care system, and millions of people collecting Social Security do NOT want spending decreased. Expect more spending, deficits, ever-increasing debt, and of course, more consumer price inflation. Silver prices will rise.
  3. Silver prices have risen exponentially for the past 90 years as the dollar has been consistently devalued. Expect continued silver price rises. See log scale graph below.

SILVER TO GOLD RATIO:

Examine the silver to gold ratio for the past 27 years. Low silver to gold ratios indicate long-term buy zones for silver. Silver prices are there now.

How High Will Silver Prices Rise?

The answer depends upon many variables. A partial list includes:

  1. COMEX silver prices are “managed” by large players, including JPM, which previously have wanted silver prices to remain low. That may be changing. Read Ted Butler.
  2. How rapidly will the Fed and commercial banking increase the supply of dollars and how much will they devalue the dollar?
  3. How extreme will our political circus become? Distractions will be necessary. The usual response is war after a suitable scapegoat has been identified.
  4. “False Flag” operations may direct blame and attention away from policy failures and toward some “common enemy.” Wars increase silver prices.
  5. When will U.S. citizens lose confidence in the dollar?
  6. How rapidly will foreign countries including China, Russia and Saudi Arabia redirect commerce away from the dollar?
  7. Hyper-inflation or 1970s style inflation?
  8. Rise of the IMF and Special Drawing Rights as a global currency?

SUMMARY:

Silver prices for the next decade are dependent upon many unknowns. However, a conservative chart interpretation is shown below.

The log trend channel has contained most silver prices for the past 20 years. A “more of the same” financial world suggests silver prices will rise toward $100 in the next 5 – 7 years.

A more aggressive chart interpretation shows prices for silver peaks rising rapidly during the past 17 years.

A blow-off rally in silver – quite possible – suggests silver prices rallying toward $200 – $300 per ounce. For comparison, Bitcoin was $3 a few years ago and recently exceeded $1,700. Amazon stock sold for about a buck 20 years ago. Today it is near $1,000. Silver near $200 is not impossible in a few years.

CONCLUSIONS:

  • Silver prices have risen exponentially for 90 years as the dollar has been devalued. Expect further devaluation and higher silver prices.
  • There are many financial and political catalysts that could propel silver prices well over $100.
  • A conservative graphical interpretation shows $100 silver within a few years.
  • A “blow-off” graphical interpretation shows $200 – $300 silver is possible in a few years.
  • If the powers-that-be create or can’t stop hyper-inflation of the dollar, $500 silver will look inexpensive by the end of next decade.
  • It is difficult to look beyond our “normalcy bias” and consider the possibility that the DOW could drop more than 50%, like it did in the 2008 crisis, or silver could increase in price by over a factor of 30, like it did from 1971 – 1980.
  • Read Steve St. Angelo: Amazing Leverage in Silver Market.
  • Read “Silver and Gold Find Support.”
  • The “silver train” has not left the station … yet.

Gary Christenson

GE Christenson aka Deviant Investor If you would like to be updated on new blog posts, please subscribe to my RSS Feed or e-mail

© 2017 Copyright Deviant Investor - All Rights Reserved Disclaimer: The above is a matter of opinion provided for general information purposes only and is not intended as investment advice. Information and analysis above are derived from sources and utilising methods believed to be reliable, but we cannot accept responsibility for any losses you may incur as a result of this analysis. Individuals should consult with their personal financial advisors.

Deviant Investor Archive

© 2005-2018 http://www.MarketOracle.co.uk - 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

6 Critical Money Making Rules