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Silver Update: Killing It Softly

Aibek Burabayev - INO.com Contributor - Metals

Experiment Results

It's time to check the results of my silver analysis. Back in November, I wrote an update on silver, in the first part of which I made an error analysis session of an earlier post and in the second part I added an experimental clone chart. There were two calculated targets: a price target and the time target.

In December, I was out of patience and was going to write a post once silver hit the price target. But it was crucial to wait until the time came to check both results on the date outlined in my earlier post. Below I've included the experimental clone model chart from my earlier post and added fresh comments highlighted in red to show the results and changes for your convenience.

Chart 1 Silver Weekly: Amazing Math

Silver Weekly Chart
Chart courtesy of tradingview.com

What do we see? Let’s start from the pleasant result. Yes, the price target was hit accurately almost cent to the cent: The $13.65 projected target versus the actual low of $13.63 in December. I was really surprised by this outcome as it strengthens my confidence in the world of numbers. By the way, the AB/CD concept target ($13.7) from my September post has also been hit. [Read more...]

Veteran Investor Rick Rule Reveals a Unique Arbitrage Opportunity

One of the hardest things for a mining executive to do may be nothing. But in a market that is not rewarding companies for pulling resources out of the ground, Sprott US Holdings Inc. CEO Rick Rule would prefer to see what he calls "optionality" rather than dilution from companies looking to justify salaries. In this interview with The Gold Report, he praises innovative precious metals streams on base metal projects and one Canadian company that is adding value and being rewarded for it.

The Gold Report: In November, you called the bottom for precious metals. Do you still believe that we're in the bottom?

Rick Rule: Yes, as long as you can define a bottom gently. I said in that same interview that the most important factor in gold pricing was the fact that it was priced in U.S. dollars, and we see a topping in the U.S. dollar. In fairness, Karen, if you had asked me that same question two years ago, I would have responded in the affirmative and been quite wrong. But I do think the upside in gold is both larger and closer than the downside in gold.

TGR: Now that the Federal Reserve has increased the key interest rate slightly, the expectation is that the value of the dollar will increase relative to other currencies. How could that be the sign of a bottom for gold? [Read more...]

Article source: http://feedproxy.google.com/~r/theaureport/Ajgh/~3/dD3lg3hefPU/16859

Silver Update: Who Shot The Sheriff?

Aibek Burabayev - INO.com Contributor - Metals

Silver started October with a long bullish candle. The next day I wrote a post that Silver could reach higher highs, and long positions are favorable from the risk/reward point of view. The metal rocketed more than $1 from the posted price ($15.229), but caught the “bullet” in the sky and fell “dead”.

Below is the reconstruction of my chart from that post to see where the metal reached and what levels were broken back.

Silver Daily: After Crash

Daily Silver Chart
Chart courtesy of tradingview.com

Silver has managed to overshoot the distance of the green ab segment by 0.382 (at 1.382 Fibonacci expansion ratio) and has outweighed Gold’s progress that it couldn’t overshoot. The entire segment has fit into a single month of October from the trough to the peak on October 28th. Gold peaked earlier on October 15th and didn’t make new highs after that. [Read more...]

Silver Update: Risk/Reward Ratio Favors Longs (1:4)

Aibek Burabayev - INO.com Contributor - Metals

Back in September, I posted a Silver update with the very promising title, "The Time Has Come," where I suggested both target and time for this fading downside move. The target at the $13.7 level hadn’t been reached as buyers did not wait to buy on the dips and had followed Gold to the upside beyond $15, but the time goal (which I stressed in the title) worked out perfectly according to the Fibonacci time zone extension. The downtrend exhaustion appeared in September and it has been really wasting away as not only the low, but also the high of September have both been trapped in the shadow of August (margins have been highlighted in two black dashed parallel horizontal lines). Below the chart, I am going to expand on the prospects of the current reversal.

Chart courtesy of TradingView.com

Laozi said, “A journey of a thousand miles begins with a single step” and the above daily chart shows us important details that can’t be seen on the monthly chart. Here we can see the last steps of the previous “journey” down and the first “step” for the way up. [Read more...]

Conspiracy Facts Show Metal Prices Have to Rise

Even in a frozen metals price market, it only takes one event to shake off the paper manipulation keeping prices below what supply and demand fundamentals of a free market would dictate. And when that correction comes, it could happen quickly. In this interview with The Gold Report, The Morgan Report Publisher David Morgan shares his favorite ways to own leverage to metal prices upside while protecting against junior mining risk.

Gold and Silver Bars

The Gold Report: You and David Smith recently wrote a piece titled "Gold and Silver: Heading for a Blue Screen of Death Event." You compared the gut-wrenching panic of suddenly facing a computer that stops working with a precious metals market that seems frozen, in the case of gold, in sub-$1,200/ounce ($1,200/oz) limbo. But then you suggested that, like a Windows operating system, the metal could be rebooted on its way to once again hitting $1,900/oz. What would it take for something like that to occur? How do you hit Control-Alt-Delete on a commodity? [Read more...]

Year To Date Dynamics: Metals Versus Top Assets

Aibek Burabayev - INO.com Contributor - Metals

Today I prepared for you the year-to-date comparative dynamics of the metals versus the top financial instruments including the Dollar Index, crude oil and the S&P 500 index.

Gold Comparison Chart
Chart courtesy of TradingView.com

As seen in the above graph, half of the instruments started the year on an upbeat tune, lead by Silver and followed by Gold, Platinum and the Dollar Index. The other half started with a nose-diving fall, especially crude oil followed by Copper, Palladium and the S&P 500 bringing up the rear. [Read more...]

Silver Update: The Time Has Come

Aibek Burabayev - INO.com Contributor - Metals

The less you watch, the more you see the whole picture. The last time I posted a Silver update was three months ago, and nothing much has happened in the market, but the attitude has changed with a fresh look. Let's take a look at the details on the chart below.

Chart courtesy of TradingView.com

In my last Silver update, I had said that in the current downtrend it was preferable to take short positions with good protective stops just above resistance and the range had been defined within the $15-18.5 margins. Indeed, the price had broken below the $15 support level and dipped lower, testing the December 2014 low at the $14 level which would open the door to interim support at $12 level. This attack was repelled in the previous month and the market closed almost in between the $14-15 level at $14.60. [Read more...]

Silver Is In Fashion But Not For Investors

Aibek Burabayev - INO.com Contributor - Metals

This week I have prepared a Silver macro data analysis with diagrams and added a technical outlook for "dessert".

Supply and Demand

Silver Supply and Demand

Chart: Aibek Burabayev; Data source: GFMS, Thomson Reuters / The Silver institute

Back in 2005, both supply and demand for Silver were below 1 billion ounces (Boz) and were well balanced with a small deficit of 7.3 million ounces (Moz). Since then they have risen with different speed and in 2014 both broke up that level. As seen on the chart above, the supply of Silver is quite stable with a narrow 889-1073 Moz range in past 10 years. 2010 (growth in mining and scrap supply) and 2014 (10 year record mining production) are the highest years of supply. [Read more...]

Gold Ratios: One Is Free, The Other Is Next!

Aibek Burabayev - INO.com Contributor - Metals

Gold/WTI Ratio: Free To Fly!

Chart courtesy of Tradingview.com

Today for the first time I will analyze this crazy ratio. Just look at the monthly chart above, compared to the dead market in the direct Gold/US dollar cross it is so wildly volatile. It jumps to either side easily like a bullet ricocheting.

This ratio is contained within a very wide range between 6 and 29 WTI barrels per troy ounce of Gold, highlighted in two blue parallel lines. For 12 years, Gold had been weakening compared to WTI Oil (highlighted by falling orange trendline). In between, only once in 1998, we can see a false break up of the downtrend which quickly lost its momentum and the ratio fell back below the line. Gold was falling despite the growing Gold/USD price. The metal almost doubled its price, but at the same time it appeared at the bottom of the ratio and what is more surprising is that when Gold tripled its USD price, it again touched the bottom at 6 barrels per troy ounce. Indeed, it was an Oil boom, not a Gold boom. [Read more...]

Gold And Silver Monthly: Monumental

Aibek Burabayev - INO.com Contributor - Metals

Comparison of Dollar Counterparts

4H Dollar Chart
Chart courtesy of Tradingview.com

In the above monthly comparison chart, I put in all of the main Dollar rivals and the Dollar index itself, which is shown inverse (100 was divided into DXY). As we can clearly see, all instruments fell dramatically last summer and didn't stop in the autumn of 2014. The black rectangle shows the area where Gold started decoupling with the rest of the Dollar counterparts. It was last September when Gold stopped falling. EURUSD is the most precise copy of the Dollar Index. Crude oil had slightly different behavior last month with less downside momentum. Therefore, all trade setups for more than half a year couldn't be accurate if they were based on pure Dollar dynamics. Gold stalled in the past waiting for a clear and powerful signal to break out of current the sideways action. The main question is, [Read more...]

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