Month of silver: price to double
We have been looking at the latest price chart analysis for precious metals from technical guru Clive Maund and his conclusions are very clear. Gold and silver prices have their lows for the year behind them and are set up for a powerful advance.
As usual there is a solid fundamental reason for this change of direction. Up until the end of last week the euro crisis threatened an imminent blow-up of the global banking system that would have resulted in a panic sell-off of all asset classes including precious metals.
Money printing again
That crisis was not only averted, and kicked down the road again but the solution in progress is going to involve considerable action by central banks to loosen monetary conditions. This is exactly the sort of environment in which precious metal prices go up and up.
Silver as ever is the classic leveraged play on gold and will go up further when gold prices go up (and down faster when they go down). Mr Maund’s charts show negative sentiment hitting a rock bottom last week in the market, a clear indicator of a market bottom now that the fundamentals have changed:
Looking foreward and the precious metals are set up for a massive rally after a long period of consolidation from previous highs. ArabianMoney brought you the predictions from the Dubai Old Gold Souk earlier this year of $50-60 silver by September and while that looked impossible a week ago it would now appear very likely to happen.