The silver value has soared to the highest silver spot price in 30 years. So what is the outlook for silver prices, the most preferred profit strategies or favoured profit plays for the rest of the entire year? 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 exactly how should one position themselves?
The consensus from lots of the market professionals is that the long lasting outlook for silver remains bullish. But that it must be currently over bought along with a pullback possibly even back to $30.00 may happen. Most appear to agree that silver is likely to run up to a high of $50.00 by the end of the year, the bearish outlook says that it may take 3 to five years to get to $50.00.
Should you glance at the silver gold ratio over recorded history you discover that it is between 16:1 and10:1. At 16:1 as well as a $1500 current gold price would indicate silver is under valued and should be trading even closer to $92 per ounce. Why aren’t we at this level? Either gold is overpriced or silver is under-priced or even the world has changed. I think it is the later.
Most of the current investors want to spotsilver.net as an inflation hedge, but which is really only part of the story. Not merely is silver undervalued versus gold, but silver is really a hedge having an industrial kicker. Silver is utilized in a large number of industrial processes and it is on the go. Over fifty percent in the silver being produced today gets used up buy industry. We’ve all seen the ways to use silver continually grow in this particular electronics age. Thirty in the past we enjoyed a twenty year flow of silver above ground for industry. Today that supply has dwindled to under a year’s supply.
Something’s wrong here, as well as the only explanation I could see is some type of government or central bank manipulation continues to be happening for many years. That could be beneficial to silver investors because when corrections do occur, they inevitably over shoot the equilibrium mark with a considerable amount.
There is certainly another issue driving precious metals prices right now that many are not aware of: gold and silver are on the go by nation states. This can be 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 had been predicted that 5 million ounces will be purchased 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 like Iran and China who don’t report their actions but that are rumoured to get buying large amounts.
Finally, silver coins are becoming the “common man’s metal”. If you are you are looking to buy precious metals along with your choice is between gold at $1500 per ounce and silver at $40 per ounce, many people are opting for the $40 because it seems to be a great deal.
So has got the silver chart shown that silver has moved very far too quickly? Some are expecting a significant pull way back in price before continuing on to test the 1980 record price of $50. Others look at the 1980’s record price and adjust the price for inflation and discover the spot silver price needs to attend $130 per ounce to be able to equal that record. So there may be a considerable ways to go yet, without even taking into account around the globe financial situation today. I don’t plan on selling any silver bars or silver bullion coins in the near future.