Reasons to stay bullish on silver and gold

[Weatherman]

Just as the hills are alive with the sound of music, GIM is alive with noise from bears on precious metals prices. I still march to the beat of a different chart. For more than a year, silver and gold have repeatedly set higher highs and higher lows, and their prices have consistently moved higher against clear uptrend lines. The current charts are shown below. Even with the sharp price drops since Wednesday, silver and gold continue to be higher than their previous lows, and they stay above the year old uptrend lines. That trend is my friend, and I am not ready to bet against it yet. I do not know what will happen in the weeks to come, but I continue to see a bright prospect for silver and gold prices ahead. My bet is that neither silver nor gold will drop a lot lower into a mini bear market until they set new weekly closing prices that are lower than the earlier lows, and until they drop solidly below the uptrend lines. DYODD, of course, but try to tune out the noise from the shrill shouters while you keep the markets in perspective.

[lhslancers3270]

Gold has made new highs. 98% Bulls a couple of weeks ago. Prechter might be the lone bear among the highly read analysts. These are the Timers the trade fades it ain't you and me. HUI and Silver have not made new highs as a matter of fact Silver now sports a lower triple top. It needs to make new bull market highs to negate this negative pattern. But WTFDIK?

[Silver]

Not much :]

[Silver-Sun-severed_heads]

cause fony fiat dollar is not real money
backed by "faith" ...... you gotta be kiddin me

I take the frn's and buy the Gold, and Silver and get rid of
this paper fiat shiieat.
Silver and Gold is a payment.
Paper fiat is a promise to pay note.

They tried to pull the sheet over our eyes so we could not see what real money is
which benefits society, not burdens, enslaves them into debt.
The gov't creating infinite amounts of fiat paper, spending infinite amounts,
this is not sustainable for much longer.
In fact we have passed the debt saturation point in the u.s.
Where is Andrew Jackson when we need him, or Thomas Jefferson.

[VTEEZER]

Fundamentally nothing has changed in the big picture!

[Weatherman]

Here is an update of the charts I posted a month ago. The markets look much more bullish now than they did then, so it is worthwhile looking at the possible near term targets for market action to higher prices. In the charts below, the top of channel line for silver is now a little above $23, and the top of channel line for gold is approximately $1,380.

[dacrunch]

Bullish article at the Motley Fool:

http://www.fool.com/investing/genera...-to-climb.aspx

Why Gold Will Continue to Climb

By Christopher Barker
June 23, 2010

While gold carves an abrupt retreat, after blasting through to a new all-time high above $1,260 per ounce early Monday, a familiar chorus of top-callers and bubble-proclaimers will again emerge to rattle the confidence of uncertain investors.

With so much bubble talk out there surrounding gold, it becomes necessary -- in the best interest of long-term gold investors -- to point out the astonishing regularity with which every momentum shift in gold's nine-year secular bull market trend has drawn fresh reiterations of bubble declarations. Their track record, frankly, is unimpressive. In my estimation, we remain so substantially removed from any ultimate top in the gold price as to render bubble declarations repeatedly, predictably, and grossly premature.

Unlike Nouriel Roubini's bold claim that those expecting sustained strength in gold prices "delude themselves," we here at the Fool consider an open dialogue weighing diverse perspectives as the best means to build a stronger investment community. This recent roundtable provides a timely and illustrative example.

For my part, I continue track the fundamental drivers that I believe portend a continuation of this long-term trend beyond my personal target of $2,000 per ounce. Although I try to avoid attributing near-term price swings to specific macroeconomic developments, the following events deserve careful consideration by Fools interested in understanding gold:

* China announced over the weekend that it will permit a gradual revaluation of the yuan by chipping away at the peg that has held the currency in lockstep with the U.S. dollar. Although hailed by U.S. officials as strongly supportive of U.S. exports, I believe this move may have unforeseen consequences. A yuan revaluation could slow the pace of China's accumulation of foreign reserves, and thereby reduce the behemoth's appetite for U.S. Treasury bonds. At a moment when U.S. deficit spending is reaching unprecedented heights and forecast to increase for years to come, this Fool finds it difficult to identify alternative creditors. In short, this raises the specter of resumed quantitative easing.
* Central banks continue to reshape the very structure of the gold market by actively amassing gold reserves. Like China before it, Saudi Arabia became the latest nation last week to reveal effectively clandestine purchases of gold by "restating" its hoard by 125% from 143 tonnes to 323 tonnes. This increase is nearly as large as India's 200-tonne purchase of gold last October that helped spark another major breakout in gold prices. Alongside purchases by Russia, the Philippines, and others, sovereign purchases have emerged as a powerful force in the surprisingly small-scale global market for physical gold.
* Over in Europe, the landscape of debt distress and fiscal pitfalls continues to worsen. Fitch Ratings recently suggested that hundreds of billions of Euros in bond purchases by the European Central Bank (ECB) will be required to contain the crisis, and deep divisions on policy directions are likely to emerge as quantitative easing returns to the table. In Spain alone, some 600 billion Euros in foreign debt will roll over this year. In Greece, even with severe austerity measures, the debt is projected to reach 150% of GDP. None of this is pretty, but all of it raises expectations for further strength in gold prices.
* Unfortunately for the United States economy, hope of a robust recovery is fading. Since we have seen the reflationary resolve with which prior deflationary concerns were met, I have no doubt that subsequent battles will be fought with ever-increasing mounds of debt. This predicament, in my opinion, sits beside the massively stressed global derivatives market as the twin 800-pound gorillas in the room. Short of summoning Godzilla, I cannot fathom how we can manage to slay these muscular foes.

In a nutshell, these developments constitute some of the key fundamental drivers affecting the gold (and silver) markets at present. These are now added to the end of a long list of prior developments that I strongly believe have laid a stone foundation for higher gold prices.

Regardless of whether last week's push above $1,250 holds in the near term, I maintain that the trend is still a discerning Fool's friend. Having fully discussed the challenges involved in gaining exposure to physical gold bullion, I continue to advocate consideration of mining shares as a profitable means to invest in the bull market. Although I am most enthusiastic about my top silver pick, Silver Wheaton (NYSE: SLW), and also the new Global X Silver Miners ETF (NYSE: SIL), attractive options abound in the gold space as well. Goldcorp (NYSE: GG) possesses superior growth potential for a large-scale miner, while Yamana Gold (NYSE: AUY) continues to reside deep in value territory for a mid-level, low-cost producer.

As this bull market matures, however, this Fool is focusing increasingly upon more junior members of the mining universe to tap greater room for growth. Taseko Mines (AMEX: TGB) has consistently earned this Fool's praise, and New Gold (AMEX: NGD) is busy growing into a large pair of golden slippers. For additional ideas, I encourage Fools to visit my silverminer CAPS portfolio, and also to review the holdings of the Market Vectors Junior Gold Miners ETF (NYSE: GDXJ).

[dacrunch]

My own opinion on gold - past 9 years chart says it all:

[Weatherman]

Here is an update of my still bullish charts. With both silver and gold down to prices that are close to their year long trend lines, now looks like a great time to buy!
I hope everyone has a safe and happy July 4th holiday.

[mk3hunter]

http://jessescrossroadscafe.blogspot...are-today.html

[Weatherman]

Even though it has been only one week since my previous charts, an update seems like a good idea because both silver and gold dropped slightly to very close to their uptrend lines, and then reversed back to the upside. It is worth repeating that both continue to form higher lows and neither has dropped below their bullish channels. I wish I had more capital I could use to buy more right now, but I am 100% invested. If anyone else is considering what to do this weekend, this setup looks very bullish to me, but be sure to DYODD before you invest.

[Weatherman]

I have sharpened my crayon, and drawn my uptrend line a little close to the market low points. These charts still look bullish to me. I will admit that I would not be quite so adamant about the bull side if gold drops much lower from here. In that case, I would probably lock this thread, and let it slip silently into history.

I am still hopeful, however, that silver and gold are near their summer lows now, and that both will soon begin to move higher toward the tops of their channels late this year. If I had spare cash available, I would be a buyer now, but DYODD before you part with your cash!

[Malus]

I just keep buying, its still a discount........

[Irons]

Every time I try to make myself bearish on gold I find a new coin to become addicted to. Sovereign Fever anyone?????

[Gold Rules]

I just keep buying, its still a discount........

Agreed..........

[Last Stand On Earth]

Massive Mandatory Spending and entitlements -> Massive Annual Budget Deficits (>1.4 Trillion/annually) -> Slowing Revenue Growth (little GDP growth) -> Massive Increases in National Debt ($13.2 Trillion or $120,000 per taxpayer) -> Interest rates at all time lows and must rise -> Higher interest payments on National Debt at time when Mandatory Spending on entitlements (Medicare and Social Security) facing large deficits because -> Boomer Retirement will increase those liabilities dramatically simultaneously decreasing the number taxpayers due to retirement unfortunately at the same time as -> Increased unemployment 9.5% leading to -> MASSIVE tax increases for the workers leading to less -> Spending which makes up 70% of our economy which will hit -> Wall Street stocks at the same time as the Boomers are drawing from their 401k's, IRA's, and Pensions to live off of resulting in -> up to an estimated 50% drop in the stock markets which will -> place a greater burden on Local and State government to meet obligations and futher -> tax increases .....

I could go on and on (and with charts), but unfortunately I do not have the time.

What we know for sure ...

1. Taxes must increase substantially to pay for our growing government.
2. Obamacare is projected to cost $1 Trillion the first 10 years. We are only getting benefits for 6 years (though paying for 10 years), so even if the estimates are even close to correct (and they are not, they never have been closer to 300% underestimated) but for giggles we will say they are close. Then the second 10 years will cost at least $2 trillion dollars just to make up for the 4 years we are not getting benefits for in the first 10 year estimate.
3. Quantitative Easing will be necessary to monitize the debt and everyone's money will be worth less as prices increase.
4. The only way to stop this whole cycle is to first limit and then reduce the size of government and neither party can/will do this and remain in power. Thus the only way out of this particular cycle is the Argentine way out.

Conclusion: Hold your gold. Nothing has/can change at this point. In the end it will be all that may trade as money.

"I hope we once again have reminded people that man is not free unless government is limited. There's a clear cause and effect here that is as neat and predictable as a law of physics: As government expands, liberty contracts." Ronald Reagan

[latemetal]

Gold and silver will hold their value against a gallon of gasoline better than the Federal Reserve Note will, I'm still buying. What the bankers did to the Icelanders, they would like to do to USA-F@CK them.

[Silver-Gold-Palladium]

"I hope we once again have reminded people that man is not free unless government is limited. There's a clear cause and effect here that is as neat and predictable as a law of physics: As government expands, liberty contracts." Ronald Reagan

Nice quote by the hypocrite who signed an executive order to create the 'Plunge Protection Team', which through the addition of new U.S Treasury, SEC, and CFTC involvement (in other words, expansion of government actions), has allowed the U.S. government, along with their shadow government partners, to rig the markets. With market rigging, as the hypocrite stated, "liberty contracts". The precious metals rigging is surely being permitted by the CFTC as a result of that hypocrite's executive order. Reagan made some very nice philosophical comments, but due to his pathetic action mentioned above, silver and gold prices are surely a lot lower than they'd otherwise be. Thanks to Reagan, we surely don't have free markets. May he continue to rot in hell where he belongs!

Reagan's pathetic presidency is freshly on my mind, because Bob Chapman, the analyst who writes at http://www.theinternationalforecaster.com
wrote just a few days ago about what took place during those years (July, 28,2010, Bob Chapman): "The presidency of Ronald Reagan opened and initiated the floodgates of debt after cutting taxes far too much and then destroying upper income taxpayers with the 1986 Tax Reform Act, which thrust 8 million millionaires into bankruptcy. Reagan’s failure to cut spending set a precedent, which lives with us to this day. During his time in office debt doubled. The result was the economy came unglued in 1989 and didn’t recover until the beginning of 1994."

[SongSungAU]

Reagan's pathetic presidency is freshly on my mind, because

Whatever your reason, please take it to the politics forum. This forum is for precious metals discussion. Thanks.

[slugbucket]

What are large industrial purchasers of silver paying right now? Do they have older, lower prices locked in? Seems like that will change soon since we have been at this level for so long now.

[Weatherman]

With a solid string of higher highs and higher lows, plus clear acceleration higher over the last three weeks, it is easy to see that gold is doing great. Gold is now well above its uptrend line and its 50 day moving average. Silver looks like it is much weaker because it is closer to its uptrend line and to its 50 day moving average. My view is that although silver has lagged behind gold again recently, that puts silver in a strong position to move higher now to catch up with the gains that gold already has. I also consider it possible that silver has been manipulated more than gold by the banksters. At some point, the banksters will need to cover some of the paper silver shorts they created, and then silver will lead the parade to higher PM prices. Both silver and gold still look great, but my money is bet more heavily on silver.

[AgAuGal]

a little concerned about the weakness in Ag just before options expiry week (Aug26th?), going inti that so weak may give the shorts a reason to pile on. next wek should be interesting.

[Weatherman]

To dream the impossible dream . . .

Here is an update of the charts I posted a month ago. The markets look much more bullish now than they did then, so it is worthwhile looking at the possible near term targets for market action to higher prices. In the charts below, the top of channel line for silver is now a little above $23, and the top of channel line for gold is approximately $1,380.

The silver and gold markets have come a long way since I offered the projections to $23 silver and $1,380 gold. I will post an updated chart this weekend, but my silver top of channel line is currently at $23.70. Silver is close enough to that target that I took a few profits on silver mining stocks yesterday, and I have orders in to take more partial profits a little higher today. That does not mean that I think silver has topped out here. Back in late November, silver thrust a dollar higher than my top of channel line, and a similar overshoot would not be surprising soon. The saying goes, however, that bulls make money and bears make money but pigs get slaughtered. I am happy to have an opportunity to take partial profits in my price target zone. I think it is also worth noting the seasonal chart copied below. A typical season correction soon would make the environment much less embarrassing for the USA at the G8 meeting planned for October 22. I will be happy to have some freshly dried powder to go bargain shopping during the last week of October! DYODD and YMMV!

[Weatherman]

Here are better quality charts to show what I see from my previous post. When I combine the seasonals chart above with the top of channel lines in the charts below, I become cautious and defensive for the short term. DYODD

Silver two year weekly


Gold two year weekly

[Weatherman]

We have come a long way from the April and May constant drumbeat of bearish noise in GIM that was especially negative about silver. I started this thread primarily so that less experienced readers would have bullish and positive viewpoints to work with too. Now the question is how high is up? The long term charts for silver and gold below give me a target for partial profit taking in a few months. The top of channel line for silver is at $47 and for gold is at $1,700. The current moves in silver and gold are amplified, but otherwise look almost identical to the 2003 and 2005 explosions that went from the bottom of channel to the top in a similar time frame. Obviously I cannot be sure that silver and gold will climb to the projected potential top before a major correction, but I sure will be happy if they do! DYODD and YMMV!

[Weatherman]

We have seen a significant correction since the start of the year. Here is a reason to hope that we may have reached the bottom of this corrective leg. Since the new high early on January 3, silver traced a pattern of lower highs and lower lows - until a few hours ago. I have labeled the lower highs and lower lows on the hourly silver chart shown below. A few hours ago, silver pushed up to a higher hourly high and just reconfirmed it. A friend of mine (who was a futures broker) 30 years ago called this pattern a "dog with its hind leg in the air". This could be the first stage of transition from short term bear to short term bull. It was the signal I needed to plow some saved cash into the markets, but YMMV so DYODD.



FYI, I think it could also be bullish if there is a sharp spike down to new lows, providing of course that there is a "V" bounce back up again. That spike down would trip out the trader's stops at several price points between 28.70 down to 28.25, and could then shake off enough fair weather traders so that the bull can march ahead without looking back.

[bemac]

Reasons to stay bullish on silver and gold

[wjv]

Just as the hills are alive with the sound of music, GIM is alive with noise from bears on precious metals prices. I still march to the beat of a different chart.

Why are some of the "boxes" on the graph red, while others are white or clear???

Thanks!

[andial]

I have stated before, and continue to be in the early November highs are the new floor for Silver camp. $28.50

[Unsustainable]

China says so.

[andial]

I should have traded more Gold in for Silver last week. DAM! Looks like no way in hell the GSR ever hits 50 again.

[southfork]

I have stated before, and continue to be in the early November highs are the new floor for Silver camp. $28.50

Absolutively.

[dacrunch]

It's been over six months since this chart:

My own opinion on gold - past 9 years chart says it all:

Time for an update?.... Yawn...

[KGMe]

I should have traded more Gold in for Silver last week. DAM! Looks like no way in hell the GSR ever hits 50 again.

I almost traded for gold at 45, but it just didn't quite feel right. Considering how small this correction was, I'm glad I didn't. I'm feeling confident enough to wait until 40 or so. Still buying gold over silver though, so I guess I'm not all that confident!

[Irons]

I almost traded for gold at 45, but it just didn't quite feel right. Considering how small this correction was, I'm glad I didn't. I'm feeling confident enough to wait until 40 or so. Still buying gold over silver though, so I guess I'm not all that confident!

Silver is like the really hot party girl. Fun as hell and really beautiful, but I don't trust it.~

[andial]

I almost traded for gold at 45, but it just didn't quite feel right. Considering how small this correction was, I'm glad I didn't. I'm feeling confident enough to wait until 40 or so. Still buying gold over silver though, so I guess I'm not all that confident!

Yeah looks like it wants to go to 40. In fact it looks certain/indubitable/incontestable/irrefutable/obvious/plain/clear and determined to do so.

[bemac]

Silver is like the really hot party girl. Fun as hell and really beautiful, but I don't trust it.~

Silver is the money of the middle class. But it's still money.

That said, I'd be buying gold right now. But I'm not selling any silver.

[curmudgeonista]

Yeah looks like it wants to go to 40. In fact it looks certain/indubitable/incontestable/irrefutable/obvious/plain/clear and determined to do so.

We talkin' dollars or ratio... or both at once?

[TimoneX]

I bet the ratio gets even tighter. Didn't it pass 20:1 in 1980? Still, though I'm not concerned with my 95% concentration in ag at this point I'd likely diversify to some extent around 35:1.

[andial]

We talkin' dollars or ratio... or both at once?

The ratio. I'll take both though.

[wjv]

I have stated before, and continue to be in the early November highs are the new floor for Silver camp. $28.50

Sure starting to look that way!

[ccjoe]

Less than 1% of the people here in the states and far fewer worldwide can and do buy any PM'S at all.
With that in mind, Silver and Copper WILL be the only choice for MOST of these few people who even do participate in PM'S to preserve their wealth. Ag and Cu are the investments for the next decade. Gold scares me because it's at it's all time high.

[stAGgering]

Copper is not a precious metal. With Cu assuming the position that silver occupied for decades, its industrially dependent performance is assured. The approaching global financial realignment will pummel Cu into submission. An attempt upon silver will be enacted as well, however silver has a dual personality and will not remain consumption dependent. As copper most certainly will.
If wisely acquired below $2 when others were fixated elsewhere. Consider converting to precious metals, starting now. The currency wars render Cu's footing precarious.

Less than 1% of the people here in the states and far fewer worldwide can and do buy any PM'S at all.
With that in mind, Silver and Copper WILL be the only choice for MOST of these few people who even do participate in PM'S to preserve their wealth. Ag and Cu are the investments for the next decade. Gold scares me because it's at it's all time high.

[Libertaurum]

anidal and KGMe, I'm on the same boat and agree the ratio will probably touch 40 before it bounces back up. Then I expect it could go to 60-65 by summer.

Why are some of the "boxes" on the graph red, while others are white or clear???

Thanks!

http://stockcharts.com/school/doku.p...uction_to_cand

BTW, good call, Weatherman!

[ccjoe]

Copper is not a precious metal. With Cu assuming the position that silver occupied for decades, its industrially dependent performance is assured. The approaching global financial realignment will pummel Cu into submission. An attempt upon silver will be enacted as well, however silver has a dual personality and will not remain consumption dependent. As copper most certainly will.
If wisely acquired below $2 when others were fixated elsewhere. Consider converting to precious metals, starting now. The currency wars render Cu's footing precarious.

Copper has a 9000 year history as currency>http://www.csa.com/discoveryguides/copper/overview.php
It just takes some googling to get these FACTS straight so people don't get confused.
In China and Japan particularly, copper is currency historically and according to 99.9% of every expert, copper is the LEAST precarious of all the PM'S. Technically it is a SEMI PM, but that will change.
I bet 50 grand on it and I'm up 15 grand in a month and a half.

[ccjoe]

http://en.wikipedia.org/wiki/Currency
Read under Coinage----copper the coinage of common transactions.
I bet it will go to that once again as it HAS been currency for thousands of years like silver and gold.
People will NOT be able to afford silver and gold> 99% of the people.
Of course I have 100's of lbs of silver coins to hedge

[Sheepdog]

ccjoe, so you are the guy that bought 50 thousand FRN's of Copper! That much Cu fills a small walmart sized building I suppose?

[ccjoe]

ccjoe, so you are the guy that bought 50 thousand FRN's of Copper! That much Cu fills a small walmart sized building I suppose?

I'm the guy that also is storing it in a high tech security facility that 60 out of 64 people disagreed with.
I put my money into silver and copper and store in safely as it's all I have.
I wish those 60 people good luck if they get burglarized. I cannot get burglarized.
I CAN lose it all like in real estate if ag/cu goes to ZERO.
So far I'm up over 100% per annum for 2 1/2 years but WHO KNOWS?
Once you lose everything, you should NEVER get cocky again, for sure.

[stAGgering]

Known already.
99.999% do not.
Those who did gain below $2.00 have an opportunity for healthy conversion now to PM.
Same strategy known for future Ag to Au.
There is copper in my pocket.
Facts do not equal fortune, even with guaranteed historical repetition.

Copper has a 9000 year history as currency>http://www.csa.com/discoveryguides/copper/overview.php
It just takes some googling to get these FACTS straight so people don't get confused.
In China and Japan particularly, copper is currency historically and according to 99.9% of every expert, copper is the LEAST precarious of all the PM'S. Technically it is a SEMI PM, but that will change.
I bet 50 grand on it and I'm up 15 grand in a month and a half.

[ccjoe]

Known already.
99.999% do not.
Those who did gain below $2.00 have an opportunity for healthy conversion now to PM.
Same strategy known for future Ag to Au.
There is copper in my pocket.
Facts do not equal fortune, even with guaranteed historical repetition.

I just got back from my storage facility where an 18 wheeler just dropped off 5000 lbs of my kilo copper bars. I hired a maintenance man there to stack it. I just checked the market and the story is still the same.
Every house needs 439 lbs of copper; every car needs 100 lbs of copper and the Chinese, Indians, Malaysians in Kuala Lumpur, and billions of others in Asian are all building MILLIONS of houses and MILLIONS of cars. It doesn't seem that tricky to figure out as it's been happening for 9000 years.
I like these facts>>>>>http://www.barchart.com/commodityfutures/Metals NOTE the RED for EVERYTHING except COPPER> Even my wife is wondering how I knew.
How do other people NOT know with all the facts out there which do produce FORTUNES!