July 21st 2019, Silver Chartbook

Silver on the up

The silver rush? Demand for silver has skyrocketed all over the world. Despite the mainstream media’s relative quietude regarding this increase in silver demand, investors have been buying up silver. Also evidenced by mint sales across the world. For example, from January to February 2018 the U.S. Mint sold over 4,000,000 ounces of silver. In that same period of time in 2019, the U.S. Mint sold over 6,000,000 ounces of silver. In any other market, a demand increase of 50% year-over-year would gain some notoriety. As traders, we look for contra-indicators in sentiment to add confluence to pattern recognition trading strategies and ideas. With silver’s ascending triple bottom looking bullish coupled with a relatively quiet media regarding silver’s demand increase, should at least warrant the consideration of low-risk accumulation at these levels. Our chartbook from May 17th 2019 and following, illustrates this story in more detail. Silver on the up.

Gold, normally leading the Silver market, sees more and more scenarios like last week:

Daily chart of gold  7/15/2019, bullish triangle:

Gold in US-Dollar, daily chart as of July 15th, 2019

Gold in US-Dollar, daily chart as of July 15th, 2019

Silver – July 15th 2019, daily chart, Silver at overhead resistance:

Silver in US-Dollar, daily chart as of July 15th, 2019

Silver in US-Dollar, daily chart as of July 15th, 2019

A bullish formation on both Gold and Silver. Shortly after, Silver breaks out of its range:

7/17/2019, Silver on the move:

Silver in US-Dollar, daily chart as of July 17th, 2019

Silver in US-Dollar, daily chart as of July 17th, 2019

While Gold still stays dormant:

Gold – July 17th 2019; Gold lagging:

Gold in US-Dollar, daily chart as of July 17th, 2019

Gold in US-Dollar, daily chart as of July 17th, 2019

Two days later our gold position yet reached another profit target zone, all our entries and exits are posted in real time in our telegram channel:

July 19th 2019, gold profit target reached:

Gold in US-Dollar, daily chart as of July 19th, 2019

Gold in US-Dollar, daily chart as of July 19th, 2019

Far so, in size of expansion, in comparison to the bull run in Silver:

Daily chart of Silver July 19th 2019; profit target zone for weekly time frame players:

Silver in US-Dollar, daily chart as of July 19th, 2019 Silver on the up

Silver in US-Dollar, daily chart as of July 19th, 2019

We try to illustrate with this example that macro economics may reflect in micro time frames.

Let us not forget that gold is trading at a multiple of the basic cost basis of its value to get it out of the ground. One could say it is expensive in comparison. And from an emotional perspective the simple price tag per ounce may make some shy away.

In further support of the underground silver rush, demand has increased in both Australia and India. In Australia, according to the “Perth Mint Gold and Silver Bullion Sales 2018 Report“, so far sales have jumped 19.6% month after month. In India, where silver’s store of value also expands its intrinsic value to include industrial purposes, an increase of 104.4% in silver demand occurred from 2018 to 2019, according to the Government of India Department of Commerce.

But it’s not just the demand-side that may lead to explosive silver growth. The supply side is just as critical, as the cost of silver mining has increased to such a degree that many companies are reporting massive increases in their cost of production, with many of them pulling back on exploration spending.

For example, in major silver producing regions like Mexico, the supply has already begun to see shortages. Basic demand and supply economics would warn that if the supply side issue continues and the demand increases, silver prices may be in for parabolic growth.

Follow us in our telegram channel.

If you like to get regular updates on our gold model, precious metals and cryptocurrencies you can subscribe to our free newsletter.

About the Author:

Outstanding abstract reasoning ability and ability to think creatively and originally has led over the last 25 years to extract new principles and a unique way to view the markets resulting in a multitude of various time frame systems, generating high hit rates and outstanding risk reward ratios. Over 20 years of coaching traders with heart & passion, assessing complex situations, troubleshoot and solve problems principle based has led to experience and a professional history of success. Skilled natural teacher and exceptional developer of talent.Avid learner guided by a plan with ability to suppress ego and empower students to share ideas and best practices and to apply principle-based technical/conceptual knowledge to maximize efficiency. 25+ year execution experience (50.000+ trades executed) Trading multiple personal accounts (long and short-and combinations of the two). Amazing market feel complementing mechanical systems discipline for precise and extreme low risk entries while objectively seeing the whole picture. Ability to notice and separate emotional responses from the decision-making process and to stand outside oneself and one’s concerns about images in order to function in terms of larger objectives. Developed exit strategies that compensate both for maximizing profits and psychological ease to allow for continuous flow throughout the whole trading day. In depth knowledge of money management strategies with the experience of multiple 6 sigma events in various markets (futures, stocks, commodities, currencies, bonds) embedded in extreme low risk statistical probability models with smooth equity curves and extensive risk management as well as extensive disaster risk allow for my natural capacity for risk-taking.

MIDAS TOUCH CONSULTING NEWSLETTER

Receive in depth market analysis and profitable investment ideas by signing up for our free newsletter.
Email address