Why silver got knocked down at 23.00

It was momentarily encouraging to see silver rally to slightly above 23.00 as the Fed keeps stimulus in place. However, it didn't stay up there for long and drifted right back to the 50dma around the 22.50 level. Perhaps flirting with the down trend line drawn in red gave the hedge funds another opportunity to short the silver market. The MACD is also rounding down so this current technical posture does not look good for the bulls. I'd like to see the red down trend line broken to the upside so that we can have some renewed buying interest and a chance at touching the 200dma at around the 24.00 level.

Billionaire Eric Sprott: Gold is going to $2400 by next summer 13 Sept 2013

Silver Technical Chart 15 September 2013

Would like to see silver go above 26 and stay above it to get more excited and encouraged. This would prove to us that the down trend which has lasted more than 26 months has most probably come to an end. Like gold, we have to wait and see what comes out of the FOMC meeting in the next few days.

Gold technical chart 15 September 2013

All eyes are on FOMC meeting scheduled on September 17-18 due to Fed's decision on Tapering. Technically, on the charts, we seem to be at an important juncture also. I would like to see the 1300 level hold next week and preferably move up to 1350 and above so as to give a sigh of relief. 

James Rickards, opinion on Fed Tapering...

http://www.multimillionairehouseholds.blogspot.sg/2013/08/will-us-fed-reserve-end-money-printing.html

Ask the Expert - Eric Sprott - Sprott Money News [Recorded on August 14, 2013]

Silver clears 50 day moving average- Silver, Spot, Daily. 12.Aug.2013

Will silver continue it's grind higher and kiss the 200 day moving average which appears to converge at the stout resistance around the 26.00 mark before another reaction occurs? Too optimistic? Then perhaps it will fail at the 22.00 mark which is the top of the down trending line. However, if it breaks to the upside from here and gets out of this down trend range, then I suppose that there will be a higher chance of challenging the 26.00 zone (previous strong support turned resistance level).

Why primary silver mining is so much more expensive today is due to several factors [By Steve; from http://srsroccoreport.com]

1) Declining ore grades: As I mentioned in a prior article, the top 6 silver companies & primary mines were producing silver at 13 oz a tonne in 2005. However, in 2012 this fell to 8.1 oz/t. I don’t have the data for 2000, but I can tell you that more than likely the top primary miners were producing silver at 15-16 oz/t at least

So as you can see, from 2000-2012, the top primary silver miners have seen their silver yields decline 50%. This means that their costs just to extract the silver have more than doubled due to falling ore grades alone. And, this does not factor in the price of energy.

2) Energy prices have quadrupled: Since 2000, the price of a barrel of oil has increased from $28 to $111. We must remember when the energy price doubles the costs down-stream can triple or quadruple. As energy costs increase, so do materials, labor and equipment. So, not only are the mining companies paying 4 times the price for liquid energy, they are also paying much higher prices for everything else.

3) Hecla’s Total Production Cost was $5.49 an ounce in 2000. According to Helca’s 2002 Annual Report, their total production cost for silver was $5.49 in 2000, which means they were losing money as the average price of silver in 2000 was $4.95. Now, we must remember, total production costs do not include ALL COSTS.

Hecla actually got their production costs down in 2002 to about $4.00, but the average price of silver was $4.60… so they still were barely making money. Hecla had a net income loss for 2000 as well as 2001. So, even though the prices of the metals were very cheap back then, many companies were not making profits.

Steve

Silver-- A review of the monthly chart. Has the new up trend already started? 9.Aug.2013

Mark Mobius: Gold Prices to Rise in Long Term 30 July 2013 [Bloomberg]

Dennis Gartman likes owning gold

Ask the Expert - Marc Faber - Sprott Money News

http://multimillionairehouseholds.blogspot.sg/2013/07/marc-faber-does-not-think-fed-will-end.html

The Secret World of Gold Part 3, featuring Eric Sprott

Silver Technical Analysis Chart- Weekly Chart.

Singapore Precious Metals Exchange CEO Victor Foo discusses the exchange's services and outlook for gold prices with Rishaad Salamat on Bloomberg Television's "On The Move Asia."

"No One Understands Gold Prices..." Ben Bernanke

Is the bull market over?

If you agree with legendary investor, Jim Rogers and you are convinced that the long term picture for gold and silver are favorable (ie the bull market has several more years to run), then you may witness an incredible buying opportunity in the weeks or months to come. However, it takes tremendous amount of courage and conviction to go against the herd, but experienced investors will tell you that this is where the real money is made.

Gold below cost of production

Will mining costs create a floor for gold prices? This is a popular argument that gold bugs (bulls) cling to, with the idea that if gold continues to be below the cost of mining, then miners will stop mining and tighten the supply forcing gold prices up.

Here is what, Jim Rogers (Chairman of Rogers Holdings) has to say regarding this during his interview with Business Insider:

"I've been in the investment world a long time and I know that things can stay below the cost of production for years. It takes a long time for people to believe they have to close their mines. It cost money to close a mine, it costs money to re-open a mine, so people are reluctant to close mines. So you can see any commodity staying below the cost of production for a while, especially if it's something like a mine which is expensive to close, and expensive to open."

ORIGINAL SOURCE

Gold And Silver – It Is Silver Sending A Message. [Edgetraderplus]

Gold And Silver – It Is Silver Sending A Message.

Gold: cyclical decline in a secular bull market. Rick Rule

Jim Rickards on CNBC. Have 10-20% of gold in your portfolio!

Jim Rickards is an American lawyer, economist, and investment banker with 35 years of experience working in capital markets on Wall Street. (Wikipedia)

Silver Will Outperform: Expert [SUN 30 JUN 13 | 10:50 PM ET]--Jordan Eliseo, chief economist ABC Bullion

WOW! lots of respect for this guy--David Mcalvany (Mcalvany Financial Group CEO) discusses gold on CNBC

Gold oversold? Ready for a rebound? You decide

Investors dumping Gold, Where's the Bottom?
According to technician Carley Garner of DeCarley Trading, right now the large speculators are holding their smallest net long position in gold futures since 2009.

HSBC: Positioned for a modest rebound in gold

"Record Chinese imports of gold, continued strong interest in gold in India, central bank buying, and muted new supply all support our thesis that the current gold price weakness will not last."
Patrick Chidley, CFA, senior vice president of global metals and mining research at HSBC Securities USA
Source: Bloomberg June 27, 2013

Fed's Dudley: QE Could Increase If Labor Market Doesn't Improve [Reuters, Published: Thursday, 27 Jun 2013 | 10:12 AM ET]

"if labor market conditions and the economy's growth momentum were to be less favorable than in the FOMC's outlook - and this is what has happened in recent years - I would expect that the asset purchases would continue at a high pace for longer." William Dudley (head of the New York Fed)

Source: http://www.cnbc.com/id/100830969

Goldman Sachs: Gold Near Bottom [WED 26 JUN 13 | 04:15 PM ET CNBC]

Why You Should Still Own Gold: Joseph Foster [On CNBC Thursday, 27 June 2013 5:08 AM ET ]

Case For Silver Simple: Industry Insider [Jun 25, 2013 Kitco News]

http://www.kitco.com/news/video/show/IPMI-2013/345/2013-06-25/Case-For-Silver-Simple-Industry-Insider

Kitco News talks with Michael DiRienzo of The Silver Institute at the IPMI Conference in Phoenix. Watch now to see what he has to say about silver. Kitco News, June 25, 2013

Silver weekly chart- technical analysis 24.June.2013

Gold under-performed relative to both the STI index and the DOW since Jan 2013

Looks like Gold is ready to flip from being an under-performer to an out-performer again? Time will tell...

Long-term Silver chart by [Peter Zihlmann / Andrew Portmann, P. ZIHLMANN INVESTMENT, www.pzim.ch]

Jim Rogers: “Thank Goodness” For Gold’s Correction - June 17, 2013 Kitco News

"Kitco News asks Jim Rogers his take of current events like Deutsche Bank's new gold depository in Singapore and the two new Chinese ETPs. Rogers also talks about how India's Finance Minister Chidambaram repeatedly urges the public to stop buying gold, stating heavy gold imports hurt the Indian economy. Finally, Rogers says that the gold correction in April was necessary for gold to avoid an even worse crash. Despite the April sell off, Rogers is still purchasing gold (and silver)....In regards to Roubini's bearish comments on gold earlier this month, Rogers says he'll ignore those predictions." Kitco News, June 17, 2013.

Original source:

http://www.kitco.com/news/video/show/on-the-spot/336/2013-06-17/Jim-Rogers-8220Thank-Goodness8221-For-Gold8217s-Correction----June-17-2013

Eric Sprott: Physical Demand for Gold and Silver is Draining Supplies, New Highs and More [Eric Sprott, President and CEO of Sprott Asset Management]

Eric Sprott discusses why he thinks gold and silver will make new highs in late 2013 or early 2014!! Doesn't mean he will be right, but it is certainly worth listening to why he holds this view.

24 Hour Spot Silver (Bid)- Source: www.kitco.com

Spot silver price sky rocketed up vertically after the PPI news release. The Produce Price Index for finished goods rose 0.5 percent in May, seasonally adjusted, the U.S. Bureau of Labor Statistics reported today. Prices for finished goods fell 0.7 percent in April and 0.6 percent in March.

What Japan Means for Gold? [CNBC Video THU 13 JUN 13 | 01:05 PM ET]

"Japan jolts gold. What's the outlook for the precious metal, with Andrew Busch, The Busch Update, CNBC's Jackie DeAngelis and the Futures Now Traders."

"Billionaire John Paulson has no intention of closing down his gold fund" -June 11 (Bloomberg)

--Billionaire John Paulson, the hedge-fund manager trying to recover from losses related to bullion this year, posted a 13 percent decline in his Gold Fund last month, according to a letter to investors. Su Keenan reports on Bloomberg Television's "Bottom Line" (Source: June 11 Bloomberg)

Commitment of Traders report (COT)- Trader Dan Norcini's thoughts

Forget all the claptrap analysis about Commitment of Traders report, hedge fund short positions, big banks long positions in gold, etc. NOTHING MATTERS right now except liquidity." Trader Dan

Source: http://traderdannorcini.blogspot.sg/2013/06/japanese-yen-carry-trade-continues-to.html#comment-form

June 10 (Bloomberg) -- Integrated Brokerage Head of Precious Metals Trader Frank McGhee discusses the price of gold with Alix Steel on Bloomberg Television’s "Lunch Money." (Source: Bloomberg)

"Gold under $1100/ounce,......and silver under the $17-18/ounce level."

June 10 (Bloomberg) -- Su Keenan recaps today's top commodity stories. She speaks on Bloomberg Television's "Bottom Line."

Copper Prices Sink to a 5-Year Low

Silver in bear market, but we welcome this correction before the next leg up!

Silver tumbled into a bear market in April and is now about 56 percent below the record $49.80 reached in April 2011. This year's plunge in silver exceeds the 17 percent drop in gold, which is poised for its first annual decline since 2000.

Tech Speaking with Jim Wyckoff: Emerging Currencies Bullish for Gold? - June 12, 2013

Source:
http://www.kitco.com/news/video/show/Technically-Speaking/334/2013-06-12/Tech-Speaking-Emerging-Currencies-Bullish-for-Gold---June-12-2013

Jeffrey Christian, head of CPM Group, discusses Gold and Silver with Kerry Lutz [http://www.FinancialSurvivalNetwork.com]

Value to Find in Silver ETFs? [TheStreetTV- PureFunds co-founder Andrew Chanin tells TheStreet's Joe Deaux.]

Silver Cycles: What Next? [Posted by Deviant Investor on June 10th, 2013 on www.deviantinvestor.com/]

Background

Silver prices peaked in April 2011 and dropped about 60% over the next 25 months. Sentiment by almost any measure is currently terrible. Few are interested in silver; most have lost money (on paper) if they bought in the last two and one half years, and the emotional pains seems considerable. It reminds me of the years after the NASDAQ crash in 2000.

So will silver drop under $15 or rally back above $50?

To help answer that question, I examined the chart of silver for the last 25 years and identified several long-term cycles. Then I constructed a spreadsheet that attempted to model the price of weekly silver based on those cycles and a few assumptions.

For FULL ARTICLE

Public opinion- Silver

"Public opinion towards silver is at very low reading and that must be interpreted as bullish." www.sentimenTrader.com

Silver Market Update [originally published June 10th, 2013 by Clive Maund on clivemaund.com]

Clive Maund's latest update on silver is as follows:
"While silver is on the defensive short-term there is plenty of evidence that over the medium and longer-term it is setting up for a powerful rally. COT's and sentiment are already very bullish indeed, which means that when the turn does come, the rally is likely to be accentuated by panic short covering.
On its 6-month chart we can see how silver is being pressured lower by its falling 50-day moving average coming into play overhead, although the increasingly large gap between the 50 and 200-day moving averages is indicative of an oversold state that increasingly calls for reversal. Volume is still predominantly negative, suggesting lower prices dead ahead. After that we can expect reversal. There was a pronounced bull hammer in silver in the middle of May towards the intraday low of which there is quite strong support- silver may drop no longer than the low of this hammer."

Read the FULL ARTICLE

Gold/Silver ratio monthly chart---trend is down!

After analysing the Gold/Silver ratio monthly chart, it is clear to anybody that the trend is down during this secular gold and silver bull market, notwithstanding it is recently up (past 2 years) within the down trend. If my thesis is correct, it is my opinion that silver will do much better than gold in percentage points term during the next phase of the bull market. To give some perspective, if gold indeed reaches a target of between $3500-$5000/ounce mark at the end of this bull market, with a gold/silver ratio of 15, silver will be trading around $230-$330/ounce mark. That's an approx. 150%-260% upside in gold from current levels and approx. 940%-1390% upside in silver! Silver clearly outperforming gold!

Eric sprott.."I personally believe that gold has hit it's bottom,...classic sign of a bottom" [speaking with Patrick MontesDeOca]

CPI ADJUSTED SILVER PRICE

Silver is still below both the 1980 nominal high of $50.00/ounce and the CPI inflation adjusted price of 1980 which is equal to $125.74/ounce.

Chart source: http://www.sharelynx.com/chartstemp/FreeGoldSilverCPI.php

60% silver correction. Would this then be the low?

Using 49.80 as the high and 19.40 as the low, that would be a 61% correction in silver. This correction then would be approximately the same depth (60.5%) as the 2008 remarkable drop. So 19.40 should provide a stout support with many traders and investors stepping in at this price. Could it go lower than this? Given the suspicious price discovery mechanism at the COMEX, I have no doubts that it could, but surely the strong physical demand from China and major central banks of the world will put a floor or limit the downside? We have to wait and see.

The other possibility is, we don't see below 20.00 and we see a turn around from here. Time will tell.

Silver & Gold - The BIG Picture - Mike Maloney

"By the way we did a study on the true price of silver coming out of the ground. It is about $20 per ounce. It varies mine to mine but that is a good all in cost for now. Mid year 2013." silver-investor.com [David Morgan]

The Macro View: Gold for the long run [DarienTimes.com; By James Rickards on May 25, 2013]

James Rickards is a hedge fund manager in New York City and the author of “Currency Wars: The Making of the Next Global Crisis” from Portfolio/Penguin

This article as it was for me, will be for you, provide some comfort if you have invested in gold and silver during the down cycle of the past two years...

Please click on the link provided below:

http://www.darientimes.com/20199/the-macro-view-gold-for-the-long-run/

Trading and/or Investing in silver

If you did your homework and came to the conclusion that gold bull market is not over yet, and will continue to appreciate against the currencies it is measured, then silver is a leveraged way to play gold. This is because throughout history, silver follows the direction and outperforms gold in percentage terms on the way up. The downside is, it has an equal effect on the way down. It is widely referred to as gold on steroids, so trade and invest carefully!
Another thing to note is the gold to silver ratio. Currently 1 oz of gold is equal to 62 oz of silver. People that have studied history will know that this ratio will eventually need to return to 15. Ie 1 oz of gold is equal to 15 oz of silver. Silver has a lot of catching up to do and is undervalued when priced against gold given the historical ratio and deserving some thought when choosing between gold or silver.

Video link: Rick Rule talks about capitulation in the metals: May 21st 2013

http://www.kitco.com/news/video/show/Metals-and-Minerals-2013/311/2013-05-21/Gold-has-Maintained-Purchasing-Power-Rick-Rule-May-21-2013

Price of silver in the early 15th century- surpassed $1200 per ounce!!!

In the early 15th century, the price of silver is estimated to have surpassed $1,200 per ounce, based on 2011 dollars. The discovery of massive silver deposits in the New World  the succeeding centuries has been stated as a cause for its price to have diminished greatly.

Source:

http://en.wikipedia.org/wiki/Silver

Silver price in nominal USD vs Silver price inflation adjusted by CPI-U

When will Jim Rogers start buying gold again? [On Fox business]

Is the world about to run out of silver?

In the latest, May 2013 Silver Bullion Newsletter, Gregor Gregersen answers some questions regarding Bullion supplies:

Is the world about to run out of silver?

Ans: Not necessarily. The extreme silver tightness is for investment grade Silver Bullion as opposed to silver in general. Mints and refineries simply do not have enough manufacturing capacity to convert raw silver into coins and bars. Silver grains (used by industry) and rough 1,000 oz poured bars are still available.

Keep in mind however that futures exchanges normally hold less than 3% in physical reserves of their net long positions. So if a major investor or bank were allowed to take a large physical delivery we could easily see an all out scarcity or market cornering as occurred in the late 1970s when physical silver was bid up to almost 50 USD (250+ USD in today's currency after adjusting for inflation).

Silver chart: technical perspective [15th May 2013 5:54PM Singapore time]

Relationship between falling gold prices and mining- Alix steel speaks on "Bloomberg Surveillance." (Source: Bloomberg)

White line demonstrates the accumulation production all-in cash cost. That means how much it costs to produce an ounce of gold (plus re-investing etc).....and that is on the rise and is above the current gold price (demonstrated by the red line)

The commodities market

The commodities market became bullish in 1999. Based on historical precedent (happened in cycles of fifteen to twenty-three years), the commodity bull may run until sometime between 2014 and 2022, although there will be some setbacks along the way. In the 1970s gold at one point went up 600 percent before beginning to react. It consolidated and declined 50 percent over a two-year period, causing many to give up. It then turned around and rose 850 percent. That is how markets work. 
- Jim Rogers (Author of book: A gift to my children)

Gold and silver is currently consolidating and declining. Have you given up or are you still holding?

In-stock Inventory at Silver Bullion Pte. Ltd. [Updated 6/5/2013 10:06]

Based on the current inventory as seen in the above chart from silverbullion.com.sg, there aren't any available physical silver to be acquired at the current price (updated 6 May 2013 10:27PM) of USD23.91 [SGD29.50]. From the silver bullion bars range only the Perth Mint Silver Bar (1KG) can be pre-ordered with a 5 weeks wait period. The rest are sold out and no pre-orders available. Now if the prices were to go lower from here (say USD21.00, 19.00, 15.00?), who'd be able to get their hands on some physical silver given that it is unattainable even at current prices?

Now with that said, it would make no sense at all (if) the prices were to go lower from here because you'd think with this remarkable physical demand, prices should be going north. But the daily silver prices are determined by the COMEX. Most of what is traded in these contracts represents silver that does not exist. Effectively, the price discovery mechanism for silver seems to be broken. However, price management/manipulation can only be temporary because eventually, physical shortages will occur which will drive prices higher.

Metals- Expiration calender, Futures Expirations

Expiration Calender - Futures Expirations Metals

Contract

Apr

May

Jun

Jul

Aug

Sep

Oct

Nov

Dec

Jan

Mar

Mar

Gold

04/26

05/29

06/26

08/28

10/29

12/27

02/26

Silver

04/26

05/29

06/26

07/29

09/26

12/27

01/29

03/27

High Grade Copper

04/26

05/29

06/26

07/29

08/28

09/26

10/29

11/26

12/27

01/29

02/26

03/27

Platinum

04/26

05/29

06/26

07/29

10/29

01/29

Palladium

04/26

05/29

06/26

07/01

09/26

12/27

03/27

Mini-Sized Gold

04/26

05/29

06/26

08/28

10/29

12/27

02/26

Mini-Sized Silver

04/26

05/29

06/26

07/29

09/26

12/27

01/29

03/27

The closer it gets to the time of the contract's expiration, the more solid the information entering the market will be regarding the commodity in question. 

Is silver a better investment than gold? David Morgan on The Daily Ticker [Yahoo Finance]

Buying Silver Bullion in Singapore; [www.silverbullion.com.sg], Physical vs Paper.

I'm amazed to see that, Silver Bullion Singapore is currently Out of Stock of all their silver coin products and the Pre Orders is between 5-7 weeks. The demand for physical is remarkable! While the Silver Coin American Eagle 2013- 1 oz is not only out of stock but also no pre order is available, you can still acquire the Silver Coin Canadian Maple Leaf 2013 - 1 oz but seeing as it is currently out of stock, there is a 7 weeks wait after you make the pre order. To give some perspective regarding the price:
The silver spot price (last updated on their site:  28 April 2013 7:00) is USD23.96 (or SGD29.70). For a quantity of 1 or more (but not exceeding 500), the current price quoted is USD29.73 (or SGD36.85). That is a premium of USD5.77 (or SGD7.15) over spot (or 24% premium). Wow!!

The alternative is to trade or invest in silver through the UOB silver passbook account. This obviously has counter party risk but works well for someone who has confidence in UOB bank and would like to take advantage of cost saving and convenience (no need to worry about transportation, storage and theft of owning physical). Note that there is a minimum transaction limit of 10 ounces. To give you a perspective regarding pricing:
The current price quoted for 1 oz of silver at UOB purchased through silver passbook account (price last updated 27 April 2013) is SGD30.50. That is a relatively tiny spread of just SGD0.80! vs SGD7.15 for the physical!

Another way to look at it is, when you buy physical, the spot price needs to go up by a remarkable 24% before you break even. Really!? 

Some may say, if you don't hold it (the physical), you don't own it and hence are adamant in accumulating the actual physical metal. Fair enough. If you are in this camp, how about acquiring the Silver Bullion Bars as oppose to the coins. The premium is approximately USD3.62 (or about 15%) over the spot price. Silver Bullion in Singapore seem to currently have available the Perth Mint Silver- 1 kg and the Johnson Matthey Silver Bar- 100 oz, both of which are Out of Stock but you can lock in the current prices and arrange for pre orders.

To visit Silver Bullion Singapore website; www.silverbullion.com.sg

See Bloomberg article [Silver Slump Lures Buyers as Waiting Time Rises in Singapore; by Chanyaporn Chanjaroen- Apr 29, 2013]
http://www.bloomberg.com/news/2013-04-29/silver-slump-seen-luring-buyers-as-wait-time-rises-in-singapore.html

To open a silversavings passbook www.uob.com.sg/personal/deposits/savings/precious_metal.html

Economic principle

Lower commodity prices increase demand and curtail supply. This is because price decline does not cause companies (miners) to rush into increasing production and buying pressure increases to take advantage of bargain prices.

CME Margin updates

CME Group Margin Changes Effective CLOSE of Business on 4/16/13

	Previous Initial	Previous Maintenance	New Initial	New Maintenance
10 Troy oz Gold (MGC) – spec months 1-13+	$594	$540	$704	$640
10 Troy oz Gold (MGC) –hedge months 1-13+	$540	$540	$640	$640
COMEX Gold (GC) – spec months 1-13+	$5940	$5400	$7040	$6400
COMEX Gold (GC) – hedge months 1-13+	$5400	$5400	$6400	$6400
COMEX miNY Gold (QO) – spec months 1-13+	$2970	$2700	$3520	$3200
COMEX miNY Gold (QO) – hedge months 1-13+	$2700	$2700	$3200	$3200
COMEX 5000 Silver (SI) – spec months 1-13+	$10,450	$9500	$12,375	$11,250
COMEX 5000 Silver (SI) – hedge months 1-13+	$9500	$9500	$11,250	$11,250
COMEX miNY Silver (QI) – spec months 1-13+	$5225	$4750	$6188	$5625
COMEX miNY Silver (QI) – hdge months 1-13+	$4750	$4750	$5625	$5625
eMini Silver (6Q) – spec months 1-13+	$2090	$1900	$2475	$2250
eMini Silver (6Q) – hedge months 1-13+	$1900	$1900	$2250	$2250

Re-evaluation of accumulation zone for silver

Given gold sliced through the 1350-1370 zone effortlessly, perhaps due to the margin related selling as the CME is raising gold and silver margins, we may have to expect silver to plummet more from the current level. Accumulation zone may arrive if silver goes down further between the 15 to 19.4 levels (this is not a prediction). Being a silver bull, I don't like giving an ugly picture but have to be realistic. As you witnessed yourself, silver can drop more than 3 dollars a day (-12%+) in a single trading day so from the current level of 22.63 (3:09:48 GMT), it doesn't seem hard to drop down further to the 19 dollar level. Based on the weekly chart of silver, I see a lot of support at the 15 dollar level so I'm crossing my fingers that this level will hold.

Having said that, after speaking with a multimillionaire investor who has invested multi millions in both physical and gold & silver savings account (paper), he told me that his thoughts were the following:
If you are a long term investor (without margin), and given you have done your homework and have the conviction that your investment vehicle (ie gold & silver) is ultimately going to much higher levels; than what happens in between for him is like as if it never happened. He bought gold because of world's central banks printing money and devaluing their currency, which will eventually lead to inflationary environment and gold (and silver) is a great store of value. For him nothing has changed.

Liquidation continues with 100+ dollar down day in gold and 3+ dollar down day in silver. Absolutely stunning!

Chart from Kitco mobile app.

Healthy correction in the precious metals

According to, Monty Guild (www.guildinvestment.com), "The Chinese and other wise buyers will add aggressively at 1350-1370, which would be approximately one third correction from 2002 bottom to 1900 top." FULL ARTICLE

If you are looking for a good entry point for silver to go long position; perhaps a good time to do that is when gold indeed targets 1350-1370 zone. Seeing as the current trend is Up for the gold:silver ratio, let's assume a ratio of 63 (from the current level of 57) when gold is 1350. This would mean a price of 21.40 silver. 

Although I don't particularly like seeing silver being smacked down from the 49.00 (and some change) high, the more experienced and wise investors like Mr Jim Rogers may view this as a healthy bull market correction or pull back. To give an example, in 2008, silver fell an impressive 55% from peak to trough.

See the brilliant chart below by Investment Score Inc. ,by:Michael Kilback

Silver will do well in an inflationary environment.

When the Continuous Commodity Index (CCI) is tracking lower (ie. deflationary) silver can not shoot sharply higher. This is because as trader Dan Norcini explains, "SILVER thrives in an inflationary environment. It will not perform in a deflationary environment."

Silver price manipulation on the COMEX

"Every day, silver (and gold) investors are subject to whatever daily pricing the big COMEX paper hangers decide to dictate, irrespective of what the real supply/demand fundamentals would suggest." Theodore (Ted) Butler from the article, The Good, Bad and Ugly

Ted Butler provides the perspective that, "As debilitating and painful as the ongoing silver price manipulation has been, if the manipulation didn't exist, neither would the prime reason for buying silver."

He continues, "Therefore, I can't rule out further silver price stabs to the downside before a dramatic and final resolution to the upside because both stem from the same cause- the manipulation."

Does supply and demand dynamics of gold exist?

We have seen a steady increase in demand for physical gold, yet we have seen  lower prices in the past few months.

Where is the demand coming from?
- India and China are strong buyers
- Central banks are currently net buyers from being sellers
- ETPs around the world, institutions and private investors continue to add to their gold hoards

Supply?
-Annual supply of gold has stayed flat at approximately 4,000 tonnes and comes from new mine production, scrap gold recycling and investor disposition of bullion.

In a recent article by Eric Sprott, the evidence pointing towards the suppression of the gold price is provided. Please see SPROTT ASSET MANAGEMENT

Silver update 20.Feb.2013

Silver has just broke out of the channel (bottom rising trend line) to the downside. Currently 29.08. It needs to quickly recover from here and get above 29.50. If that fails, then 28.00 should provide strong support and I'd be buying some more to add to my core holdings.

Is the bottom in for silver!? 20.02.2013

This is just my personal opinion and not trading advice. Please do your own analysis and research before making the decision to buy silver and trade at your own risk. Thank you!

Latest Technical analysis chart_15Feb2013

Silver - The Element of Change 4FEB2013 [SilverInstituteTV]

One of the most informative videos about silver that I've come across to date. Highly recommended video by, SilverInstituteTV.
Silver is a popular store of value for centuries!! Got silver?

Silver-Real Shortage Out There- Tom Cloud (Cloudhardassets.com)

Tom Fitzpatrick's (Citi analyst) latest commentary on silver on kingworldnews.com

"Good resistance is met at $34.40-35.40 (on silver) and then most importantly at $37.48. A weekly close above that latter level would signal gains back to the April 2011 highs near $50 (a 56% surge from current levels)." Tom Fitzpatrick

Please see FULL ARTICLE

Strong gains for silver. Is a breakout to the upside imminent?

Silver To Rise Over 500% In Next 3 Years - BBC

Mainstream media talks about silver!

Billionaire Eric Sprott, from Sprott Asset Management

Eric Sprott - "Silver Remains The Best Investment Of The Decade"
 

Silver (XAG:USD) showing positive price action 02.Jan.2012