According to James Turk:
Full article here: http://www.fgmr.com/silver-approaching-stage-two-of-its-bull-market.html
Full article here: http://www.fgmr.com/silver-approaching-stage-two-of-its-bull-market.html
Silver is Approaching Stage Two of its Bull Market - James Turk
- Thread starter Ouch
- Start date
realisticmystic
New Member
Thanks Ouch. Good article
I think we are late into Stage 2 (maybe around 90% in).
We are definitely past stage 1, there is more and more awareness out there. But one thing that will be different this time around, is that the stage cycles will be shortened. We have the internet now, so information travels much faster and more easily accessible.
I don't think mania stage has started yet (in the physical arena). Refiners are still playing the spot price game and supplying into the market at the manipulated prices.
Physical needs to detach from this and let market forces decide what the real price should be.
When the price discovery phase for physical happens (in the near future), a few things may happen:
- There needs be an a reference point and anchor established for the true price of silver inflation adjusted (experts range this from $80 to $150 - $200)
- Supply and demand will naturally move towards this anchor point, again the strongest of hands will wait until this price is established, people will sell into the market and take profits along the way.
The problem is no one knows what the anchor point will be, the price of silver has been suppressed for so long, no one knows what a fair price is. So people will only sell when they have to or when they feel something else is of value worth trading for.
- Gold will have an effect on the price of silver, the GSR will provide some leaders on this.
- There is a chance during this discovery phase, the bubble is blown up into epic proportions, that would resemble the mania stage.
I think the main thing is, when we see this price discovery phase. These are the signs I would be looking for:
- Who is buying physical (average mum/dad on streets?)
- What is the current price? (relative to value of other goods and asserts, GSR)
- What is a fair price you think it should? (relative to value)
- Is it overbought?
- What is happening on the demand and supply front?
Also have an exit strategy in place, if you feel its the correct play. Then execute the strategy and don't look back =D.
Slam
We are definitely past stage 1, there is more and more awareness out there. But one thing that will be different this time around, is that the stage cycles will be shortened. We have the internet now, so information travels much faster and more easily accessible.
I don't think mania stage has started yet (in the physical arena). Refiners are still playing the spot price game and supplying into the market at the manipulated prices.
Physical needs to detach from this and let market forces decide what the real price should be.
When the price discovery phase for physical happens (in the near future), a few things may happen:
- There needs be an a reference point and anchor established for the true price of silver inflation adjusted (experts range this from $80 to $150 - $200)
- Supply and demand will naturally move towards this anchor point, again the strongest of hands will wait until this price is established, people will sell into the market and take profits along the way.
The problem is no one knows what the anchor point will be, the price of silver has been suppressed for so long, no one knows what a fair price is. So people will only sell when they have to or when they feel something else is of value worth trading for.
- Gold will have an effect on the price of silver, the GSR will provide some leaders on this.
- There is a chance during this discovery phase, the bubble is blown up into epic proportions, that would resemble the mania stage.
I think the main thing is, when we see this price discovery phase. These are the signs I would be looking for:
- Who is buying physical (average mum/dad on streets?)
- What is the current price? (relative to value of other goods and asserts, GSR)
- What is a fair price you think it should? (relative to value)
- Is it overbought?
- What is happening on the demand and supply front?
Also have an exit strategy in place, if you feel its the correct play. Then execute the strategy and don't look back =D.
Slam
Goldmember
Member
Stage 3 will hit when the US goes belly up....how long is that away? (...not that i REALLY want that to happen but i think its inevitable)
Silverthorn
Well-Known Member
Ouch said:
It was an interesting read. I'd of never thought to put gold and silver into different stages like that.
Another thing worth considering...at least for silver...is how small the physical market is.
If above ground silver is really only worth US$30B at the moment, and a good number of those currently buying are looking to hold for at least 12 months...then we may never get to the point where the average mom and dad are out buying silver on the street. A few hedge funds, commercial buyers, and large individual investors could effect the mother of all squeezes in the silver market...and that'll be all she wrote.
If above ground silver is really only worth US$30B at the moment, and a good number of those currently buying are looking to hold for at least 12 months...then we may never get to the point where the average mom and dad are out buying silver on the street. A few hedge funds, commercial buyers, and large individual investors could effect the mother of all squeezes in the silver market...and that'll be all she wrote.
silverfunk
Active Member
I think we are still in stage 2 and have a long way to go before any mania.
Silvers a steal under 100.
Silvers a steal under 100.
rbaggio said:
Well if youll take opinions of ppl from other topic (is somewhere here on the forum) and conclude that 08 - 09 was a bear trap then yes
Ofcourse, thats why i said majority. Cmon, now and again you can clearly see silver appearing on magazines, sites etc. Its media awareness isnt?
Aengrod said:
I find it unlikely that a majority of people on this forum think we are in Phase 3 of this silver bull market. For example, with gold ...
Now the fun begins. This is the shortest but most explosive phase of the secular bull market in gold. This is the phase when all the sleepy financial institutions and the public finally wake up. Almost every week a new precious metals mutual fund or exchange traded fund will be launched as money pours into the sector. This is the inflection point when the public clamors to get aboard in true "gold rush" fashion and Wall Street is more than happy to accommodate with a constant flow of recommendations. Prices will continue to climb considerably beyond all prior fundamental benchmarks.
src: http://seekingalpha.com/article/241664-the-three-phases-of-every-secular-bull-market-in-gold
lakesentrance
Member
I myself am wondering more when will the physical be detached from these ETF's.
It's obviously a big anomoly setting the Spot price for physical using a paper traded share. With the paper market, which I assume is what sets the Spot price, there is no real correlation between supply and demand. You can buy and sell tonnes of paper silver, irregardless of supply and demand issues of the physical.
Is it possible, for the actual physical pm to be disconnected from the paper ETFs, and thus find it's own true price according to actual, physical, supply and demand in the world?
Or have I got this all wrong?
It's obviously a big anomoly setting the Spot price for physical using a paper traded share. With the paper market, which I assume is what sets the Spot price, there is no real correlation between supply and demand. You can buy and sell tonnes of paper silver, irregardless of supply and demand issues of the physical.
Is it possible, for the actual physical pm to be disconnected from the paper ETFs, and thus find it's own true price according to actual, physical, supply and demand in the world?
Or have I got this all wrong?
Silverthorn
Well-Known Member
If you really thought the finally stage was approaching you should be gradually selling into the rallies. Still quite a long way to go before that I think.
unfunkable
Active Member
Silverthorn said:
sorry im still a noob.
does the 'final stage' people keep talking about refer to silver prices going up? if so, wouldn't you buy now and not sell?
El Bullion said:
This is a very good point.
These are the things we all know about a 3 phase bull market.
Phase 1) Quiet accumulation from smart investors, with a vision of whats happening and long term
Phase 2) Slight awareness by the savvy investors, price has already moved. However the price is still an excellent buy. Small media attention
Phase 3) Common awareness, people wanting to buy hand over fist (irrespective of price, because they feel it can only go up). A lot of media attention.
The above will stay true in a normal bull market, where everything is certain and there are no unknowns. IE, throughout the last 15 years everyone feels property can only go up in Australia. The financial market and currency system itself is sound (well appears to be). No one thinks outside the whole box and thus the 3 phase bull market plays out as per history. The main stream media consistently pushes this bull market. IMO, this is starting to end.
Can the same concepts be applied to a physical silver market, here are the unknowns that totally distort the whole market for physical silver.
- Price being dictated by paper spot. (Can this go on for ever, this is not reality). If I was a refiner, I would give the comex the finger and start selling to the public at a price they can command. Its starting to become a sellers market.
- The physical market being so small that the amount of money out there can buy it 100-1000 times over (worldwide GDP)
- The risk of fiat currency going to its intrinsic value of zero (more people are waking up to this fact)
- The timing cycles and information awareness is shortened (information found daily on the market)
- Ever increasing need for industrial use, oil being more expensive and the easy silver has already been mined
- The chance of Silver becoming a monetary metal again (as opposed to a commodity)
- The possibility of the chinese planning to back their currency in an hard asset or number of hard assets (I believe gold will underpin this). The chinese may want to become the worlds reserve currency because of its manufacturing and labour force.
These are only some of the points I have come up with that will move the silver price irrespective whether its in stage 2 or 3..
The other side of the equation is when a bubble market turns from boom to bust. There has to be an overwhelming reason for people to sell and flood the market to drive down prices. What is the catalyst for this, the only one I can think of is if it is overbought and overvalued (by those that have leveraged into it). Again you will need to shake out the strongest of hands to get silver off them. Strong hands are ones that own the metals outright and have no debt obligations. If silver maintains purchasing power over time, why would they need to sell?
Anyway, I just feel that the phase indicators only give a small picture of the whole market. The factors I have listed move physical silvers price to equilibrium. Maybe by then we will see the bubble forming. Or it may form during that price discovery phase.
Slam
rbaggio said:
i was reffering to this topic: http://forums.silverstackers.com/topic-4987-phase-ii-starts-in-australia.html
Silverthorn
Well-Known Member
unfunkable said:
If you think its in the final stage you want to sell before the end? Hard to tell when the end would be so gradually sell as it rises. I don't think we are anywhere near that yet though.