What Happens To Gold And Silver Next? Look Out Below?

Currencies seem to be in the right areas at present.

The Aussie is where it should be around US$80c.

Is there a glut of phyzz gold?

Is there a glut? I won't post the stats that say yes. I will say that as a dealer I know other dealers that are turning away small sellers of gold and silver. Just not worth the time to fill out the paperwork. Some have minimums of 10 to 20 dollars. One I know has a minimum of $40 for him to buy. Some refiners are now also imposing a minimum buy amount.

Does this sound like a market on fire?

In my shop, I have not seen a bullion buyer in perhaps a year. I'm back to selling coins. I have had ASEs sitting on the shelf for almost 2 years. Just no demand. Except for a few small collectors and year sets.

The Gold and Silver market move in almost predictable ways now. UP then back down. Yup is right about the range. Someone who has a lot of volume is making money on this. The rest of us? Who cares? ( from their perspective). Right now they are just using the market to make what my Grandma called "pin money".

I was collecting gold eagles, silver eagles as a young teenager, first came silver then came gold eagles a decade later to my collection.

I remember buying silver around also around 4ish and later as I started to like collecting old, buying eagles around the mid 300s?. (I will have to check out my collection to make sure I got my numbers right)

that said, in a context of an overall very long term time frame, some of these metals have enjoyed a nice uptrend, tho GOLD and not silver, is the winner over this long term time frame.

Thats how markets work tho. There are times to be in, times to be out and times to do nothing. That is a full time job to really know when to buy, sell and sit out. There are tho a few things the public can do to avoid the old "sell at the lows and buy at the highs"..... it can be done but takes work, discipline and the ability to keep things simple and just observe.

For now, gold and silver remain in the "meh" category. Not bad, but not great, just range bound, tho again, gold has shown more flashes of greatness over silver as of late. (I really hope you people are buying more GOLD over silver)

IF I have time i'll post up some recent charts but there really isn't much to see. One's money should have been in the equity market, especially since Nov 16. If you have not been in the market, you have missed some spectacular returns and those who held from 2000 on the Nazzy have been made WHOLE and then some. The money flow is certainly in equities, and its not just here but all over the globe.

Now let me circle back to my earlier point about gold having some flashes of greatness. (oh god my charting platform I love to use just went down LOL as I am typing this so I have to go off of memory lol)

But look, we saw gold make yearly highs this year, that is a positive as it increases greatly the probabilities that we see gold at some point attempting to hit those yearly highs again. it broke the previous yearly high of 1338 set back in November of last year and hit 1362 before rolling over, as it has many times before. That still is key because yearly highs are a positive sign that buyers are there, they really are buying. That favors gold.

Silver did not make yearly highs, it really has struggled with that mid 18s price area. In fact it suffered a flash crash to yearly lows in July which was both not good in terms of price but was a gift to dip buyers. (BTW, anytime you get a flash crash like that in markets, whether it be stocks, bonds, currencies, etc, thats a good spot to buy, just close your eyes and do it) You'll notice gold did NOT flash crash around that time, which again re-enforces my point that GOLD and NOT silver is the place to be.

Silver gives you high beta, super charged moves over gold (as if gold wasnt that way either). But here is the thing, it really has been lagging. its working really hard to hold on to its gains this year.

the question remains- is silver going to catch up with gold? Also, is silver, when the time comes in the future, will it retest its all time highs of 50s and break through and make fresh new historical highs? Lots of questions that can only be answered by the market.

The only other thing I can say about gold and silver and the future is that it is interesting to note that the options market is showing some interesting speculating far into the future, into late 2018.

more recently, a speculator took an gold option calls for 15,000 Dec 2018 3000 calls in gold. There have been more and more option plays like this for both gold and silver and it basically means some large speculators are making some bets that gold and silver are going to be much higher in the future.

time will tell if these bets pan out....
Whether that pans out, no one can really say, there are no crystal balls when it comes to markets but these sort of positions taken out are worth noting and keeping an eye out. obviously some speculators do think gold and silver are going to rise. Remember, markets are dynamic and look into the future...

@D0ubl3Eagle


Yes, that is correct, for gold, $3000 and perhaps that would indicate an area of higher prices than that.

I believe they were at a cost of .15 cents, so since they are wayyy out in the future they are cheap so clearly IF things dont pan out in the speculators bet, the risk is managed as well.

There have been other repeated and similar options placed for silver and gold also, way out into the future.

Again, no one as a crystal ball but factor in markets and how they are always working and pricing things into the future, it does raise some eyebrows.

It will be interesting to see how things work out, sometimes the option market has been exactly right, other times its wrong.

In any case, some large speculators are and feel like taking some hedges in gold and silver as a form of protection. Whether they will pan out, that remains to be seen. Gold, however, the price action particularly, as I mentioned yesterday, has had some strength to it, which seems to jive with some of these options plays we are now seeing.

From what I've been reading, big deals in au/ag are being used as hedges going forward. It's like a 50/50 bet silver is going to go the opposite way you think it's going to go when you buy it. I can only guess, if equities try to sell off in the future we may see a historic swing up in the metals due to the ETF effect, maybe not right away but as the dust begins to settle they could drive it up and maybe those funds will grow. We have a large above ground supply of silver and gold going too though. I still think future inflation via a long low interest rate period was cooked into au/ag prices, I thought I heard gold fell this time due to the possibility of 4 rate hikes by end of next year.

Considering we have been in a stock market bull market since the end of 2009 I have to believe a sell off is overdue. Would now be a good time to diversify into PM's, short term bonds or cash? Because I did not get out of the stock market when it crashed in 2008-2009 I have some really large capital gains. I did sell some of my high flyer's over the last three years but I still have very large capital gains in stocks. I am getting nervous and want to diversify into safer asset classes but accepting a 1% yield causes me to gag. Any opinions out there? I know Yup7676 has some ideas. I got out of silver in about 2005 and I regret that to this day. I was buying silver at melt prices at auctions in the form of sterling. I think the spot price of silver was about $7.50 an ounce and I was buying large silver trays, silverware and other silver objects for about $6 an ounce. The Dow made another record today and the market continues to soar. This won't end well. The money is going into ETF's.

Terry, I hate to say this but being nervous is really a bad emotion to have when it comes to markets. The reason I say that is because you should allow profits to run until there is evidence, expressed in price, that things are going to fall apart.

The market breadth underneath is very strong. In other words, there are many sectors that are showing leadership, that means someone is buying, this isn't just some run thats on fumes, ready to sputter out.

Also, throw out any form of logic at this point, such as the one going around that we have been running since 09 higher so the trend is too old. The fact is, trends can run longer than anyone can predict. That is why we are going higher.

Furthermore, I want to remind you that even tho we have been running higher since 09, we spent almost THREE YEARS going sideways, we really didnt start ripping higher until nov 2016.. we almost were range bound roughly from 2014 into 2016,, That range was resolved to the upside.

Not too mention, and this is major, we broke on the Nasdaq, after close to 16 years, the previous highs set in 2000, that is MAJOR, that is a huge longer time frame break out and you can see why we have had a big move there.

The market uptrend remains innocent until proven guilty,in other words, stick with the trend until the price action says the move higher is over with.

Also, we are NOT going to crash. Markets do NOT CRASH when they are near all time highs. Every single time markets crash, they already were exhibiting weakness and expressed it via price action and sent many warning signs many weeks in advance that something bad was going to happen or that the market was in a very weak state.

This trend in the stock market will eventually die. However, when it does, it will not be a sudden immediate move down and poof, all done. Rather, it will be a process, little by little, all the dominos will start to fall, one by one.

Again, the current price action is saying to sit and stay for now.

None of the safe havens are doing anything. Bonds are dead money. Gold and silver are still acting pretty crappy.

Finally, I will leave you with this thought. No one ever walks away with selling at the top or buying right at the bottom. Absolutely no one does, the market is too big for anyone person or institution to be able to do that.

Rather, what is done is rules are put in place. These rules are tied together with market conditions. Having rules in place is what removes emotions out of this game, including being nervous.

IF you still remain worried, then perhaps you could sell half and let the other half run in those positions with large gains. Or sit down and consider what is the max profits you want to let go, that you will allow a long leash on. Say you have 100% profit on a stock. Maybe you look at your current situation in life, your plans and say "ok, I will only allow a 20% drop in those profits and then I book the gains". That is just an example.

I guess I am saying is have an exit plan ready and do it now if you are worried. have some plan in place were you emotionally feel comfortable with the profits you take. As I said earlier, you can always sell half and let the other half ride and put some sort of exit plan on that half.