Does this mean that gold and silver are set for their overdue rise? Does this mean that the markets are due for a legendary collapse, the likes of which have not been seen since the 2008 financial crisis?
The answer is yes, no and maybe. Yes, the markets are going to have a monumental correction, and yes, gold and silver are destined to move higher, but who knows when. It could be today, it could be tomorrow, or a year from now.
Regardless of when this monster move higher in precious metals will occur, we can breathe a sigh of relief today, as the metals are experiencing some positive news at last.
Gold has surged higher, breaking through the $1100 ceiling that has held it back for quite some time, and in addition to this, it has once again pushed through its important 100-day moving average.
Although still ridiculously cheap, silver has also moved higher and broken its 50-day moving average.
These averages are important, as they can usher in a wave of traders that are looking to chase easy money, which will bring additional flows of cash into the precious metals space. This has the possibility of creating a self-fulfilling prophecy that moves prices higher and higher, similar to what was seen when silver neared the $50 mark some years ago.
These are the kind of breakthroughs that traders watch closely, and you can rest assured that they are once again watching the precious metals space, especially given the recent predictions from some of the banking elite for it to move higher throughout this year and next.
The biggest risk we now face is whether or not the cartel will once again put its thumb on the paper price of these metals and force it lower. It is a possibility, but at some point, regardless of what they want, the metals are going to move higher. The free market will make sure of that.
So is this the long awaited breakout we have been waiting for? Is this the start of a renewed upturn in precious metals? Only time will tell, so until then, sit tight and be right.
- Source, Sprott Money