How low will silver go?

[Mackaydon]

IMO and shared with a few.....t[FONT=&quot]he rapid and significant ascent in the price of silver in 2011[/FONT][FONT=&quot] could potential have been fueled by significant risk aversion and concerns over the possible effects of massive quantitative easing measures to prop up the economy. That fear was not sustained, and the price of silver then abated.
Don......[/FONT]

 

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[Mackaydon]

Silver has been floundering now for about 5 years.
What will make silver rise above 20 or fall below 14?
All the 'traditional' prerequisites have come and gone without effect.
Where are the current Hunt Brothers?
Don......

 

[fistfulladirt]

Silver has been floundering now for about 5 years.
What will make silver rise above 20 or fall below 14?
All the 'traditional' prerequisites have come and gone without effect.
Where are the current Hunt Brothers?
Don......

We really need some new Hunt Bros.

 

[TheCoinKid]

Unfortunately, the events of 1980 are not likely to be repeated. Regulations have changed, not to mention the events placed much of the Hunt family assets into bankruptcy.

 

[fistfulladirt]

Unfortunately, the events of 1980 are not likely to be repeated. Regulations have changed, not to mention the events placed much of the Hunt family assets into bankruptcy.

Plenty of us to corner the market.

 

[Johnnybravo300]

All the markets are rigged and fake including spot prices which are fake and kept artificially low. With 4 cents of purchasing power left in the dollar and falling it can only go on so long, so says history. There's no reason to think this would be any different.

It seems too complicated to understand because they want it to be that way. All anyone needs to understand is how to be prepared when it does happen and that is simple. Trade your fake money for real money.

 

[Mackaydon]

I buy into what Jim Wyckoff recently wrote for the Kitco News.

"December silver futures bears have the overall near-term technical advantage. Silver bulls' next upside price breakout objective is closing prices above solid technical resistance at $15.50 an ounce. The next downside price breakout objective for the bears is closing prices below solid support at $14.00. First resistance is seen at $15.00 and then at this week’s high of $15.07. Next support is seen at $14.555 and then at the August low of $14.405."
Source: http://www.kitco.com/news/2018-08-29/Gold-Silver-Prices-Lower-On-Little-Risk-Aversion.html

I interpret that as little volitility is expected in silver since there are no catalysts on the horizon that will significantly move its price. In essence, silver is stuck in a $14-$20 rut; as it has been for years.
Don.....

 

[Johnnybravo300]

My gut says !buy! but my brain says they can keep this up for years haha. I just hope nothing crazy happens for a few years so I can better position myself for the next engineered crisis.
Can't let a good crisis go to waste!

 

[Mackaydon]

We're testing the 'solid support' level of $14.
Good place for 'stackers' to continue to buy and average down their positions.
Don...

 

[Johnnybravo300]

Yep lots of manipulation in the paper markets and physical accumulation going on right now by the big boys. Good time to follow what they do and stack away like mad. When it seems worthless is the best time to buy. Good things always come after the metals get a little beating.

 

[fistfulladirt]

Big house inventory choices drying up. Premiums on premium bullion remaining, keeping pace.

 

[Mackaydon]

As the price of silver nears $13, I begin to waiver on my commitment to wait for $12 silver --while 'stackers' may continue to average down their holdings.
Don.......

 

[Johnnybravo300]

"Averaging down", I like that. That will be my new term with my wife when she asks what the money order is for hehe.
Don't worry hun, we're averaging down.

 

[fistfulladirt]

Dollar cost averaging. I’ve done that, although some investors say it’s the kiss of death lol. “Trying to catch a falling knife”. Isn’t the time to buy not at the bottom, (I wish) but at the turn, or proven upswing?

 

[jim4silver]

Dollar cost averaging. I’ve done that, although some investors say it’s the kiss of death lol. “Trying to catch a falling knife”. Isn’t the time to buy not at the bottom, (I wish) but at the turn, or proven upswing?

From my perspective, the difficult part for most PM holders isn't buying at the right time (even though that is obviously important), it is selling at the right time. I remember guys who hated silver until it broke $30-$35+, then they bought in, became converts, and didn't sell at $50 because they got greedy and wanted to become millionaires. After the downturn they sold at where they bought or less, and now they hate silver and would never buy at this price. They probably will buy again when/if it gets to $30.

These same types of folks bought bitcoin after all the headlines and when it was $10,000+. Many of them are probably crying now. I was in one of my local coin stores during that time and saw an older lady (60-ish) selling over 6 figures worth of gold. She was ranting about the profits she and her hubby were going to make in bitcoin. She was in such a hurry to spend the $$$ she told the store to wire her the cash instead of getting a check. She saw the look on the coin dealer's face and said "do you think I am making a wise choice?", dealer said he liked gold better. She laughed as if saying "we'll see who is the smart one". That was when bitcoin was about $12000-$14000. I would be willing to bet she and her husband didn't sell at the top (which was within a short time), but I am just speculating. At the time, I actually questioned my own decisions and thought the lady might be right. I didn't buy any bitcoin but I am glad of that today since I would have been late to the game like she was.

Anyone who thinks PMs will be worth more in the future and can sit for a while should buy some at these prices if they don't have much now. Physical metals have to be mined and refined. They can't be printed or made out of 1s and 0s in a computer program. At some point if the paper price (what is quoted) goes too far below the cost to manufacture, it won't stay for long. Despite what you read in some of the BS pundits' articles, folks who play Comex can stand for delivery and the other side has to provide the metals. Although that doesn't happen much in Comex compared to those who play just for paper profits, it is an option for a long if they desire. For people just wanting to buy a lot of metals its easier to buy from a large wholesaler. But if the paper price gets too low, Comex is a viable option to avoid the "premiums" you would pay buying from a dealer, etc. However getting delivery does involve many steps and would be a pain compared to buying from a dealer. If there ever was a "default" where a long was forced to take cash instead of metals it would be a world-wide headline. Past defaults in other commodities are quite rare.

 

[Mackaydon]

From my viewpoint, silver has not responded to the usual favorable and adverse catalysts; it seems 'to march to the beat of a different drummer'. Are we back to the basics of REAL supply and demand--and no longer buying into the hype of 'supply decreasing and/or increasing demand? I think so. As 'fistfulladirt' mentioned above, I'll wait for a pronounced upturn (or when it hits $12), then 'average down from there' or put in a stop-loss order; still undecided on that point.
Don.....
PS: My best wishes for the safety of those in the path of Florence.

 

[jim4silver]

Many people think of PMs as an investment like stocks, etc. That is wrong thinking, especially in today's world. They are better thought of as an insurance of sorts against other investments and foolish policies of world governments. People can trade and flip PMs but the premium spread will make that hard to profit except when the market is moving much in a particular direction. Pros can make $$$ flipping ETFs or futures but that is hard for average folks to do profitably.

Many of the past catalysts don't seem to work in predicting PM price movements because the world has changed much since gold and silver were considered money. There are also mechanisms today that siphon off some physical demand for gold such as ETFs, ETNs, etc. These financial vehicles didn't exist too long ago. Plus the fact many folks don't even carry cash anymore and use cards to pay for everything. Those like this won't even think of PMs except for jewelry, and even then many younger folks today opt for wedding rings and other jewelry made out of things other than gold and platinum. So don't expect the average man on the street to be the cause for PMs to rise. He may take part in the buying later on, but definitely won't be in at the start of any move.

But that doesn't mean gold (and silver) won't be important down the road. One mistake I used to make is to think that other wiser investors, speculators, etc, "knew" something I didn't about PMs. Or that somehow there is knowledge and wisdom that some have and some don't among the general population. When in reality nobody really knows anything about where markets are headed. Some make correct educated guesses and some make correct flips of the coin, the rest are wrong or too early in their calls, etc.

What can't be denied is that those with much wealth will try to preserve it as much as possible if/when the next financial calamity, etc hits. It is said the the reasons for the 2008 problems still exist and are actually worse than in 2008, but you won't know that looking at the media reports each day. Emerging markets are hurting as their currencies and such are dropping in many places. These places will and can affect the rest of the world if they starting defaulting, etc.

Sooner or later there will be another 2008 but this won't be papered over like the last one. As most asset prices move in cyclical fashion over time, so will PM prices. PMs and some other commodities are about the only assets that haven't risen or been inflated over the past 7 years or so like so much else has.

In the 2008 crash PMs fell too initially but remember PMs had been moving up nicely since 2001 or so, so there were profits to pull to pay for stock, etc paper loses. Today PMs are hated my most all, so there will not be as many holders who need to sell in the next crash other than perhaps PM bugs, etc. Much different landscape than 2008.

Although I wouldn't base my trades on Nostradamus, there is an interesting quatrain of his that I think one day will come to fruition. Remember, Nostradamus made some correct calls during his own lifetime so there is at least a chance this one will be true at some point. Here it is century 8, quatrain 38:

The copies of gold and silver inflated
which after the theft were thrown into the lake,
at the discovery that all is exhausted and dissipated
All scrips and bonds will be wiped out.

I like the "imitations of gold and silver inflated". Mmmm what could that be today?

Here is what central banks have been doing and generally they know a bit more than the common man on the street, you would think.

https://www.forbes.com/sites/simonc...uying-spree-over-dollar-worries/#2fc1e5d61fc2

 

[Mackaydon]

Jim,
The Forbes article you referenced seems to concentrate on only 'demand'. The other side of the situation (supply) should also be considered.
"Each year, global gold mining adds approximately 2,500-3,000 tonnes to the overall above-ground stock of gold." Gold production has shown an upward trend in recent years, putting further initial downward pressure on the price of gold. Personally, I don't buy into the notion that gold and silver are being manipulated by any group to the extent of controlling the price. The Hunt brothers are gone and (thankfully) De Beers is not in the gold and silver markets as they are in diamonds.
Don...

 

[jim4silver]

Jim,
The Forbes article you referenced seems to concentrate on only 'demand'. The other side of the situation (supply) should also be considered.
"Each year, global gold mining adds approximately 2,500-3,000 tonnes to the overall above-ground stock of gold." Gold production has shown an upward trend in recent years, putting further initial downward pressure on the price of gold. Personally, I don't buy into the notion that gold and silver are being manipulated by any group to the extent of controlling the price. The Hunt brothers are gone and (thankfully) De Beers is not in the gold and silver markets as they are in diamonds.
Don...

Don,

I can't figure out supply with accurate info re: gold mining, etc, but just guessing I would say that dollar creation (and other currencies around the world) eclipses the amount of gold mined each year if compared to each other. The current administration is creating national debt as fast as the as the last one. And there is no stopping now. Until a crash or something bad that trend will continue here and probably other places no matter who is in power.

In other words, more dollars are being created (or digits or whatever they are) at a faster pace than new gold is being mined. But I am just guessing I could be incorrect.

In full disclosure I am not a "stacker" any longer. For the past 4 years or so I have been buying as if I were a coin dealer and only buy stuff that has a built in immediate profit (if I were to sell on ebay, etc) of at least 25% but usually I get stuff with 50-100% built in profit (sometimes even more). I only buy wholesale and have some great sources local and out of state. For example I can get when available lunar series coins for a few bucks over melt, kooks and koalas bu and proof, proof sets from Mexico, GB, Australia for the same, pretty proof coins in boxes with COAs for a couple bucks over, etc. All the stuff most US stackers don't care about. It's good to specialize in stuff others don't know much about nor care.

I have put many hours building these relationships with coin dealers that it seems I spend almost as much time messing with PMs as I do running my business but it is like a hobby so I enjoy it. Someday hopefully it will pay off.

I only sell at the 1-2 coin shows I do each year. So my stuff is like my retirement account but I have enough extra value built in I can be braver when buying than if I was buying plain old bullion. I've thought of liquidating it all and putting the proceeds into bullion but I'm too scared to do that just yet.

So I'm not giving advice just my random musings. I gave a few folks bad advice about buying silver when it was $30 back in the day so I only talk about this stuff on sites like this for fun.

 

[Mackaydon]

Mine production accounts for the largest part of gold supply – typically, 75% each year. However, annual demand requires more gold than is newly mined and the shortfall is made up from recycling. The majority of recycled gold - around 90% - comes from jewellery, with gold extracted from technology providing the remaining 10%.
Source:https://www.gold.org/about-gold/gold-supply
Don......