The Conversation (0)
Writing for iNVEZZ.com, Jon Salmon of EVR Bullion Ltd. (UK) raised the question of whether a silver price breakout is nigh. He said that while there are many reasons to suppose that’s the case, “[t]he next few weeks might be a test that proves whether this is the case.”
Writing for iNVEZZ.com, Jon Salmon of EVR Bullion Ltd. (UK) raised the question of whether a silver price breakout is nigh. He said that while there are many reasons to suppose that’s the case, “[t]he next few weeks might be a test that proves whether this is the case.”
As quoted in the market news:
The key for Silver will be a successful close above this year’s high of $22.20 toz set in February. For clues, we need to look at the current fundamentals, particularly the economic outlook:
The most notable news last week was the sharp downward revision to US 1st Quarter GDP, from an original annualized rise of 0.1% to a huge fall of -2.9%. As usual Wall Street analysts continue to be optimistic for the 2nd Quarter, but the signs from recent business and consumer surveys have tended to disappoint. Furthermore, initial official figures for Services Spending in the US for April and May, representing 68% of GDP, show very little growth for the first two months of the current quarter.
On top of this bad news, reports from April suggest underlying credit conditions in the US are rapidly tightening. Tightening monetary conditions are bad news for an economy that appears to be slowing both sharply and unexpectedly, while prices are rising. They had a word for it: stagflation. These were the conditions that prevailed in the 1970s bull market for gold.