Silver and Gold

Even though we are entering the holiday season, I'm not referring to the Burl Ive's song. A couple weeks ago, I mentioned that the gold and silver markets started a retracement, or change in market direction for a period of time. This is setting up to be a classic market pattern.

For any technical traders, this is called a double bottom. If you're not a trader, think of the letter W, with the two bottom points of the letter. In Elliott Wave Theory terminology, we are near the end of a simple wave 2c prior to the beginning of a long wave 3 going up. Elliott Wave also projects the market price targets. Based on the beginning of wave 1 around Aug. 20 at $660 per ounce, gold will very likely go up to a minimum of $960 from its point now in the coming months. The upper target is $1250 per ounce. This wave 3 will likely happen over the next six months.


Silver is in a comparable position. See the chart below. The Elliott Wave target prices for silver on the low end is $18.00 per ounce and the upper target is around $24.50. Again, there is a very strong likelihood that this will happen over the next 6 months.

As you can see, all charts were copied from www.kitco.com, an excellent resource in researching all precious metals.


The market will likely be driven on a fundamental basis by poor holiday sales. Consumers are getting jittery about the overall state of the economy. They will spend less than previous years and will bring retailers' profits down. That, coupled with a sagging stock market, and eroding value of the US dollar as mentioned in previous posts, will trigger many investors to start or continue moving their assets into more stable and profitable positions with gold and silver, or other more profitable assets. Gold and silver have always been investor safe havens during periods of economic instability.

Just so you can get a bigger picture of what gold and silver have been doing over bigger time periods, I'm attaching the 6 month and 5 year charts below.











Blessed is the man who finds wisdom, the man who gains understanding, for she is more profitable than silver and yields better returns than gold. Proverbs 3:13-14 (NIV)

Wisdom is also knowing the timing of market cycles. Next week there will be more information on the value of businesses and other resources readily available that most people do not think about. Stay tuned ...

If you have comments or questions, please feel free to contact me at the address below.
Email: DeltaInspire@panama-vo.com