Dear readers,
On 16th February 2011 I wrote you the following on gold and silver:
In 2011 I see silver at at least 50 USD/Oz and gold approaching 1800 USD/Oz. Probably this is too low. Friends and I have discussed that what we see happening is transpiring much slower than we anticipated, however I do feel 2011 will be the year when gold and silver becomes mainstream. If I am correct the above fiat price targets will be proven wrong on the low side.
At that time gold was trading at 1,371 USD/oz and silver 30.63 USD/oz. Silver exploded to the upside and almost hit 50 in late April before correcting down back almost to that same level of 30 a few days later in early May. Today, silver is again trading above 40 on its move back to test its nominal all time high at about 50. Gold has during the last couple of weeks had a similar ride as silver did earlier this year, moving sharply up and surpassing the 1,900 level. And like silver, gold had a healthy correction down to 1,700 and change just a few days ago. Today, at the time of writing, gold is trading at 1,820 USD/oz, matching my target quoted above.
Now, before you get impressed, let me be clear and state that I based the above on other peoples work. People that are far more intelligent and better researched than I am, like the regulars at KingWorldNews.com, such as Dan Norcini, Jim Sinclair, Ben Davies, James Turk, John Embry, Eric Sprott and others like David Morgan. However, I do try to compile many different predictions and boil them down to averages and then applying my own macro views on things. By the way, I often post links to these experts at the RealMoneyTracker.com blog.
However, like I wrote: If gold and silver becomes mainstream, I said I was going to be wrong. It’s time to re-evaluate targets for 2011.
Financial media here in Sweden have finally, after a +10 year bull market, started publishing articles about the fact that gold could move even higher. Of course, you all know gold and silver are moving higher, but my point is that the popular media now at least quotes bulls, not only bears. This is a clear sign that we are now entering a new phase in this bull market. Thus, the greatest gains are still ahead of us, and so is the time of ever increasing volatility, making predictions even more difficult to make. Not to mention the increasing sovereign debt crises and the political issues in the financial world, like Hugo Chavez demanding his gold back, just to mention one of hundreds of issues.
The trajectory for the golden ascent is clearly increasing. It has even been exponential during the last month. If gold can take out 1,900 USD/oz, a gold price in the range of 2,100-2,300 before this year is over is certainly possible, since the seasonal moves to the upside are usually during this time of year. Silver, being the more volatile of the two monetary metals, is even more difficult. I do feel we will break the psychologically important 50 level at which point silver will probably take out 60 in a heartbeat. If this happens in September I think we could touch 70 by year end.
This is very difficult, and it’s getting more and more difficult every day as volatility increases not only in gold and silver, but also in their antitheses, fiat currencies. But for the fun of it going out on a limb, on December 31st 2011, I think gold will trade at 2,200 and silver at 65 USD/oz. 2012 will be even more extreme than 2011. Sit tight, and be right.
Feel free to contact me with comments.
Best Regards /Johnny
