The Rhythm & Price Video Update below takes an in-depth look at a major cycle in spot silver, which projects silver coasting down to a coming low in October after a short term double top:
Precious metals investors have endured much hardship during the recent bear market but David H. Smith, senior analyst with David Morgan’s The Morgan Report, believes that another secular bull market in precious metals is already underway. In this interview with The Gold Report, Smith says that platinum group metals will lead the resurgence and have a favorable long-term risk/reward ratio.
He outlines some PGM, gold and silver companies that can grab the bull by its horns.
As the MUST SEE 5 year silver US dollar chart below reveals, it appears the year plus sideways trading action in silver with minimal volatility is about to end.
Statistically, gold and silver prices closely follow each other.
But what is more important is the ratio between silver and gold and the trend of that ratio.
The 30 year gold/silver ratio chart reveals that the silver-to-gold ratio is currently priced at the low end of the range, long-term silver prices are gradually increasing relative to gold, and a price explosion could occur at any time!
We have well documented over the past few months the unprecedented flows of physical gold and silver being drained out of Western vaults and shipped East.
SD reader Ji Hai Shan, an American currently residing in China, has provided a boots-on-the-ground first-hand account which substantiates our recent claims that spiking silver premiums on the Shanghai Gold Exchange indicate a shortage of the physical metal in China.
“3 months ago, when I inquired about buying some more bars, they said that I would have to wait a month.
So, yesterday, I stopped by the shop and was told again that I would have to wait a month.
The affordable investment grade bars are in shortage.”
Ji Hai Shan’s first-hand account of the developing shortage of investment grade silver in China is below:
Using the 144 week moving average data, the silver peak (weekly closing data) in early 1980 was 10.4 standard deviations above the norm. The April 2011 peak was 4.12 standard deviations above the norm. The current price for May 2014 is about 0.75 standard deviations BELOW the norm. Current 144 week moving average of the weekly silver closes is about $27.50.
The bubble peak in 1980 was thousands of times more extreme and LESS probable than the price spike in April 2011, which was not, in my analysis, a blow-off bubble.
The bubble in silver and gold is coming – it did not occur in 2011.
Expect stormy weather and higher silver and gold prices ahead.
When? Ask the High-Frequency-Traders, JP Morgan, the Treasury department, or just wait for demand to overwhelm physical supply in the relatively near future.
Physical silver demand was UP big in 2013. Ironically, physical silver production in Canada has dropped significantly in 2014.
Meanwhile, long time precious metals uber villain Jeffrey Christian is out with the 2014 CPM Group Silver Yearbook [priced at $150!!] which once again distorts the FACTS in service of the longtime Bankster narrative that silver in PHYSICAL form is abundant, easy to mine and of little real value.
David Morgan from Silver-investor.com joins the SGTReport to dissect the SILVER LIES and LIARS.
Silver dipped to $19.10/oz overnight and remains under pressure this morning . With the gold: silver ratio at just over 66 ($1,290/$19.38/oz), silver remains a compelling buy at these levels.
The stealth phenomenon that is silver stackers or long term store of value buyers of silver coins and bars continues and is seen in the record levels of demand for silver eagles from the U.S. Mint. The US Mint sold 13,879,000 ounces of me in Q1, 2014. This is just over 2% less than the 14,223,000 sold in the first quarter last year. March sales were the fourth-biggest month ever and the US Mint is now on pace to exceed 2013 totals.
Silver stackers remain the smart, informed buyers. They realize that silver is undervalued versus gold with the gold silver ratio at 66:1. This is particularly the case on a long term historical basis. The long term historical average, gold to silver ratio is 15:1.
Silver industrial and investment demand is increasing very significantly and meanwhile supply is falling. The fact that the huge majority of the investment public and financial services industry remains unaware of the fundamentals in silver means that the bull market in silver likely remains in its intermediate stage.
In this exclusive interview with Reluctant Preppers, precious metals advocate The Doc from SilverDoctors.com & SDBullion examines the essential points that must be considered when deciding whether NOW is the right time for silver.
The Doc discusses where we are at in the current secular bull market, market psychology, physical demand trends he’s seeing in the market, and what the final blow-off tops in gold & silver are likely to look like.
The Doc covers how he recommends strong your precious metals (storage MUST be allocated & segregated), discusses what lies ahead in 2014 for Gold and Silver, and explains why we should listen to Eric Sprott & Jim Sinclair’s outlooks for Gold and Silver in 2014.
Is NOW the right time for silver? SDBullion’s founder breaks down the PM market below:
The real price of silver bottomed in 1931 and again in 2001, which could be described as a 70-year double- bottom. That is 20 years longer than gold’s bottom, quite a massive divergence. In 1980, for the first time since the first bottom, silver made an attempt to test the previous highs in place since the 1800s, and actually exceeded it for a while, which is typical of how silver can spike. So, silver actually technically did what gold did at least 40 years earlier.
After the second bottom of gold in 1970, gold started a rally that ended much higher than the previous highs of the 1800s. That is what rallies after valid double-bottoms normally do. Now, as I have said above, silver made the second bottom of its double bottom in 2001, and has started a rally since then. If it continues to follow what gold did, as well as what normally happens after a valid double bottom, then this rally will end much higher than the real highs of the 1800s.
Given the fact that silver has a tendency to spike much more than gold does, then we should expect massively high silver prices during this coming rally.
The key to investing in silver is getting in before the big gains are made. The sector that will have the largest impact on future silver investment demand will be institutional buying. According to Rick Rule of Sprott Asset Management, we may be witnessing the beginning stages of what could be a big move of institutional investors in the physical precious metal market.
The writing is on the wall. The Fed & Western Central Banks are propping up the world financial markets by pumping in huge amounts of liquidity. This policy has put into question the long-term viability of the Treasury & Bond markets.
Even though the East is participating in the Grand Paper Liquidity Scheme, they are forced to do so because the Dollar is still the global reserve currency. However, as confidence in the Treasury & Bond markets begin to wane, we are going to see more institutions and retail investors rotate out of paper and into physical assets.
You can buy more than three times the amount of silver compared to oil today than you could during the decade of the 1960′s.
The Central Banks and Monetary Authorities have done a fine job bamboozling the public in making sure that gold and silver remain as silly investments only the fringe in society would purchase and hold.
When the price of silver reached $35 an ounce in 2011 it wasn’t a parabolic move higher, rather it was behaving more like a balloon being released from far below the surface of the water. The coming explosion in the value of silver will be a shock to the world.
If we were to value silver today compared to its oil ratio during the following periods, this would be the result:
As the year 2013 comes to a close, the Western super-crisis has entered a lull period, and an Asian citizen gold demand era begins. It could be said that your “Queen Gold” jockey is changing horses in 2014. She’s moving from a Western racehorse… to an Asian Clydesdale. In the biggest picture, I think this means that Western precious metals investors are going to have their golden cake, and eat it too!
If gold and silver are transitioning from a Western-centric bull market to an Asian-centric bull era, then super-sized chart patterns should appear in these markets, and this appears to be the case with silver.
The ratio chart shows a gigantic head and shoulders bottom pattern in play, and it suggests that in 2014 silver should begin to outperform the T-bond for many years, and potentially for decades.
Are such low silver prices ever possible again? Technically, yes.
Unless one was fortunate to have acquired the bulk of their physical silver allocation circa 2005 at an FRN price of under $6.00 per ounce, silver’s fall from grace since its 2011 peak has been nothing short of a hellish nightmare for most.
The current bear market in precious metals has had no mercy for those too anxious in backing up their trucks to load up on these highly valued and much sought after monetary components.
NEWSFLASH: Gold & Silver (REAL-MONEY) remains ON-SALE!
In this interview with Peter Spina, Eric Sprott discusses the unprecedented silver consumption by India for investment purposes as the Indian gov’t cracks down on gold imports, and how India’s 4,000 ton increase in silver demand this year alone is likely to affect the silver market going forward.
Eric views the current price action in silver as extremely counter-intuitive considering the physical supply and demand fundamentals, and states that to see the price of silver go down in this environment (as India consumes an ADDITIONAL 30% of global investment silver supply) just blows me away!
Sprott concludes: These trends simply can’t continue. You can’t have India suddenly consuming 15% of the global market, people in the US buying an all-time record amount of silver, and put the same amount of money into silver as gold, those things cannot continue to happen and the price of silver stay down.
Eric Sprott’s full MUST LISTEN interview on silver is below: