Predicting The Movement Of Precious Metal Based On News Events.

Pretty sure no one can do that, right? It kinda feels like you are wanting to day trade precious metals.

Not so much gold, but I have been lucky enough to time/buy a couple dips. Once during a major event in early 2020, $12 silver and again two months ago at $20.

The metals markets, like so many other markets, have been manipulated for decades. You could say the gold market was manipulated in 1933 when FDR recalled all the gold for $21 per ounce and then reset the value at $35 per ounce once all the gold was confiscated. You could say that the silver market was manipulated in 1979-1980 when the Hunt Bros. tried to corner the market. I've studied the movements of metals over the past 50+ years and how they relate to the ever rising costs of goods and inflation. I've tried to figure out if gold is currently over valued or silver is currently under valued. My conclusion is that both are true. Compared to the current values of real estate and new automobiles (the largest inflated items), gold should be in the neighborhood of $1680 per ounce and silver should be in the area of $50 per ounce. Instead we have gold at over $2000 and silver at $25 right now. Like you, I used to try to predict based upon events. I remember purchasing my first $20 Saint in 1990 the day the gulf war broke out. The value didn't really start to appreciate until 2006 (16 years later). Rather than trying to predict movement by news events, I think it is more important to follow what the big fish are doing. Right now most of the large banking and financial institutions are investing heavily in stock piles of gold. What do they know that us peons don't? I have been a firm believer in physical tangible assets vs paper fiat money. If you can't hold it in your hand, you don't own it! I don't see metals as an investment vehicle but the track record as a hedge against inflation is proven. The big factor right now is the high premium over spot to purchase these commodities. With silver, one would have to be crazy to invest in Silver Eagle Coins with a 76% premium compared to 10 ounce silver bars with a 18% premium. Gold premiums are not near as bad as silver. 1/10 ounce gold eagles carry a premium of 29% while the 1 ounce gold eagle only carries a premium of 7% and if you choose a Pamp Suisse 1 ounce bar it only carries a premium of 5 1/4 %. For me the go to investment is either 10 ounce silver bars or 5 gram gold Pamp Suisse.bars with a premium of 12%. It is what I can afford for under $500 at a shot.

I think financial news events have a greater effect on PM price movements than general news. That is not to say that major geopolitical events would not move the markets.

I look at PMs as a store of value, not an investment (though I hope it appreciates). Stocks and bond are a better long-term investment. PMs don't pay dividends or interest and have proven to be volatile too.

There are a number of things that impact both the Stock Markets and Precious Metals markets and while these things could be tracked in the past, it is impossible to do so today.

The rise of computer triggered program trading and the vast and I mean "VAST" sums of money that can move into and out of positions in seconds based on complex decision algorithms that very few understand just highlight the impossibility of an ordinary person being ahead of a market trend. If you are ahead, it was luck pure and simple.

This is one of the reasons that Wall Street introduced circuit breaker stop trade cool off events... Just so the computer program trading didn't get on a roll and wipe out the economy based on a news trigger that was given too much weight... See https://en.wikipedia.org/wiki/2010_flash_crash for a discussion on the May 2010 flash crash.

For me... I take it easier... I collect coins because they are nice, shiny and pretty. If you are on a forum such as this, you are unlikely to be in a position to profit from market moves unless you just happen to luck out so check profit or investment at the door and enjoy the hobby... It is easier on your blood pressure.

On any given day there is news that is supposed to account for the movement that day. Market prognosticators just need something to say everyday.

We are all subject to confirmation bias. If you are long PMs, you will favor any bullish story and anything to the contrary, you will tend to dismiss. If you are short or looking to buy, any negative story brings you hope and any bullish story you'll ignore.

For most of us it is just a cool hobby to fuss over. Only speaking for myself but I would guess for most people, the amount of PMs you have can never make a huge impact on your life. Everyone has way more tied up in their home and their retirement accounts.

Silver is a bit odd right now. What I *think* may be happening is there is an influx of new buyers who are seeing banks going out of business and thinking it might be a good idea to hedge a little money with some 90% or ASE's.

This is why I *think* we are seeing such a premium as if you want 100 ot 1,000 ounce bars, or contracts, fine, but a roll of dimes or qyarters, something that sets you back a few hundred, there aren't as many around.

Generic rounds and bars are fine but they don't have the imprint of the government to validate them. So the premium on gov issue is higher

Gold is fine also, less premium to pay, but if your a new buyer you just don't get much to hold in your hand. $2,000 + will buy you 1 gold eagle or close to 60 silver ones. $2K is a lot to pay for one coin if you are new to the process.

The gold silver ration is currently 83:1 when I write this. Try to find somene to give you 80 silver ASE's for 1 gold one. Monument has 1 oz gold eagles for $2,135 and silver for $39. That works out to 58:1 in actual ratio