The silver value has soared to the highest silver spot price in three decades. So what exactly is the outlook for silver prices, the preferred profit strategies or favoured profit plays for the rest of the season? Well it depends on which expert you talk to. The silver price per ounce rose above $42.00 in mid-April, a 31 year high. That is up 32% for the year so far and more than doubled since last September. The question the majority are asking is where is it going from here, and how should one position themselves?
The consensus from most of the market professionals is that the long-term outlook for silver is still bullish. But that it is currently over bought as well as a pullback even perhaps returning to $30.00 may happen. Most seem to agree that silver will probably run as much as a high of $50.00 at the end of the season, the bearish outlook says that it could take 3 to five-years to get to $50.00.
If you consider the silver gold ratio over recorded history you locate so that it is between 16:1 and10:1. At 16:1 and a $1500 current gold price would indicate silver is under valued and should be trading nearer to $92 per ounce. Why aren’t we at that level? Either gold is overpriced or silver is under-priced or perhaps the world has evolved. I believe this is the later.
Lots of the current investors want to www.spotsilver.net as an inflation hedge, but that is really only area of the story. Not only is silver undervalued versus gold, but silver is a hedge with an industrial kicker. Silver is used in 1000s of industrial processes and is also very popular. More than half of the silver being produced today gets utilized buy industry. We’ve all seen the ways to use silver continually grow in this electronics age. Thirty in the past we enjoyed a twenty year supply of silver above ground for industry. Today that supply has dwindled to less than a year’s supply.
Something’s wrong here, as well as the only explanation I will see is some kind of government or central bank manipulation continues to be happening for many years. That may be great for silver investors because when corrections do happen, they inevitably over shoot the equilibrium mark by way of a quite a bit.
There is certainly another issue driving gold and silver prices right now that numerous are not aware of: silver and gold are on the go by nation states. It is a game changer. The CPM Gold Yearbook reports the aggregate total of the amount of ounces of precious metals bought or sold by nations worldwide. Because the early eighties governments have been selling. In 2008 it absolutely was predicted that 5 million ounces could be available in 2009. The 2010 CPM Gold Yearbook shows a net buying of 15 million ounces. This rqihjx an indicator that governments worldwide are beginning to distrust the need for the American dollar. Which doesn’t include some countries including Iran and China who don’t report their actions but that are rumoured to get buying large amounts.
Finally, silver coins have grown to be the “common man’s metal”. In case you are you are looking to buy precious metals along with your options are between gold at $1500 per ounce and silver at $40 per ounce, so many people are opting for the $40 as it is apparently a good deal.
So has the silver chart shown that silver has moved very far too fast? Some are expecting a significant pull in price before continuing to test the 1980 record value of $50. Others look at the 1980’s record price and adjust the price for inflation and discover that this spot silver price needs to visit $130 per ounce to be able to equal that record. So there might be a long way to go yet, without taking into consideration around the globe finances today. I don’t intend on selling any silver bars or silver bullion coins any time soon.