Silver put in a double-bottom last fall. It tested its December 2015 low, but couldn’t manage to break below it.
Now, after a rally off that bottom, we have a pullback. This could be the opportunity we’ve been waiting for!
Look at this chart of the iShares Silver Trust ETF (SLV) and you’ll see what I mean …
|Image credit: StockCharts.com|
You can see that the SLV, and silver itself, are in big downtrend. It’s just 6% above a bottom that silver tested last year AND in late 2015. The price of this metal is coiling up like a spring.
Not only that, the Gold-Silver Ratio — the number of ounces of silver it takes to buy one ounce of gold — is at a historic high.
The Gold-Silver Ratio is almost 90. You’d have to go back to 1991 to find it any higher. It’s even higher than it was at the depths of the 2008-’09 financial crisis!
This ratio is one of the most reliable “buy” indicators for silver. When it climbs above 80 … you want to grab it with both hands.
For Some Perspective …
The ratio of silver to gold in the earth’s crust is 17.5-to-1.
In Roman times, the gold/silver price ratio was set at 12-to-1. In 1792, the ratio was fixed by law in the U.S. at 15-to-1.
Over the last 20 years, this ratio has averaged “only” around 60-to-1. Thus, at almost 90, the current ratio screams, “Grossly undervalued!”
Many folks are taking advantage of this situation: The U.S. Mint sold 4,017,500 American Silver Eagles in January, the most in two years.
|The American Silver Eagle, which contains one troy ounce of silver, is the official silver bullion coin of the U.S.|
We’re closing in on a MAJOR REVERSAL of this ratio, meaning gold must decline (unlikely, as gold’s bull market is just beginning) … OR SILVER MUST RISE!
Talk about having an opportunity handed to you on a silver platter!
If you haven’t staked your claim, now’s a good time to do it.
Whether it’s buying shares of SLV or purchasing physical bullion, there really isn’t much of a downside at this point.
It sure looks like silver could catch the wake of gold’s tailwind. This could be the start of something big.
And for even greater upside, you might consider the Global X Silver Miners ETF (SIL). Because when the metal goes up, mining stocks tend to SOAR.
I’ve recommended one of the top names in silver to my Wealth Supercycle readers.
This company is great at controlling costs, and expansions at the company’s mines in Mexico are setting up a nice opportunity for investors who get in now.
And, it continues to raise its dividend payout.
And, a recent acquisition just made it the world’s largest silver producer!
And, the stock recently put in a double-bottom!
To find out more about it, join us in Wealth Supercycle here. We’d be glad to have you in our club!
All the best,