Metal Musings of a Madman:
Hi....I was just thinking about gold & silver,& I'd like to hear your comments on what appears to be a surprisingly bullish situation.
**Silver:
I've recently spent some time looking at a variety of commodities other than gold & silver. If you look at many of the others (sugar, copper, cocoa, coffee, soybeans, etc.), the weekly charts have a sort of "waterfall" like downtrend. Naturally, it depends on the product, but these commodities have been hit VERY hard.
In contrast, silver has held $5 well, and keeps trying to go higher (although failing so far).The only thing that has fared better would probably be palladium & oil (or some of the other funky markets like cobalt).
Is this not excellent relative strength? Does this not mean that if the commodities ever get into bull markets, silver has excellent potential to ROAR?
***Gold
What will happen to gold @ $250 or $260?
1. Some mines will shut down
2. Mines will NOT want to borrow gold for major multi-year forward positions (how many could repay the gold @ $250?
3. Without the mine forward sales & decreased mine production, what will fill the supply/production gap?
Of course the CBs could dump more gold, but they would have to dump it directly instead of through leasing to miners.
Could this be the end of the bear? Somewhere the "physics" of the situation must create support.......
What do you think?
THC |
