According to InvestingHaven’s market readings, silver is now starting a new wave in its secular bull market. In a way, it’s official now. The writing was on the wall, we were there, even in the public domain, with this market call: This Giant Bull Flag Will Be Fuel For A Big Explosion In 2023. To be clear, we are talking about a secular bull run, not a tactical bull run. History shows that secular bull runs take a few years to complete. History also shows that there are 3 waves higher (two corrective waves), with the 3d wave being the exponential phase. We believe the 2nd leg higher is now officially starting. With this, our Silver Price Forecast For 2023 is now confirmed, and new ATH will be set somewhere in the period 2024-2025.
Arguably, the first run of the secular silver bull market was the period May/June/July of 2020. After this quick run from 15 to 28 USD/oz, silver took a break that, according to us, officially ended last month.
Our continuous coverage of the silver market is now justified. Not only justified, it’s also a very accurate market call. Our silver leading indicators, as weekly covered in detail in our premium services (Momentum Investing for stock market investors and Trade Alerts for traders) were accurately forecasting a new bull market.
The SLV chart shown below is the one that visualizes the end of the corrective wave and start of a new bullish wave: there have been more than 13 days above the nearly 3-year falling trendline. That’s a secular breakout.
Even if the 50% retracement level will be back-tested in the coming weeks (21.90 in SLV), which is unlikely but might happen on an intraday basis, it would qualify as a secular breakout back-test.
Why the hell would silver be in a bull run amid a banking crisis and disinflationary monetary policies? For several reasons:
- The banking crisis, as explained in Systemic Risk Continues To Fade, Turns Out To Be Another Bear Trap, resulted in a massive monetary liquidity injection by the Fed (sort of monetary easing although nobody will call it as such). Precious metals rise on monetary easing.
- Gold & silver had no opportunity to adjust to the new reality of higher prices and wages. A delayed reaction makes so much sense.
- The USD has been pushing higher for 2 years, there is no way gold & silver can stage a bull market amid a rising USD.
- Above all, we mentioned that 4 Structural Changes Confirm The Start Of A New Secular Silver Bull Market, with physical silver tightness top of the list.
In other words, there are more reasons why silver would be staging a new bull market than why it would continue to underperform (which is what it did since 2012).
How to play this new silver bull run?
Holding physical silver in the form of an ETF like SLV or on a bullion bank makes so much sense. Next to this, we believe that top quality silver juniors will be ballistic in the next 24 months.
To be clear, when we say ballistic, we mean ballistic. Think crypto pumps of 20% on a day. It won’t happen next week, it will happen at the heights of this 2nd and the next 3d bullish wave. That’s when individual positions should have risen high enough to create an exponential compound effect.
We highly recommend you re-read this recent article to ensure the quantitative justification of the previous point we made: Silver Junior Miners Hitting A Crucial Price Point.
Looking for top silver miners? In our latest Momentum Investing alert we included our top selection: Portfolio Charts, Sentiment Insights, Silver & Lithium Updates.