Outlook For Gold And Silver In 2010
Looking back at Mover Mike in December of 2008, I wrote in The Precious Metals,
So here we are at the end of 2008 and Palladium is back to its lows of 2003 to 2005 and Platinum is back to the $800 area of 2005.
There’s been a relationship between the three metals and to me, Gold looks like 2008 since the peak at over $1,000, has been consolidating. Now it looks ready to break out again to new all time highs.
Gold broke out in 2009, vaulting through $1,000 reaching a high of $1,218 in the first week of December of 2009. For the year Gold was up about 26%. What lies ahead for 2010? I think the period we’ve gone sideways under $1,000 is similar to the final run to $850 in 1980. From 1975 to 1979 Gold traded sideways under $180 then took of to $260. It had a nasty little pullback to $200 than when it broke the high of $260, it ran to $850 in a year. I think we are in the same spot now as then. That means that the most explosive part lies just ahead. By the end of the year, we trade at $6,500.
Palladium closed 2008 at $188.70 and finished 2009 at $407.26. Platinum closed 2008 at $936.2 and finished 2009 at $1,460.0. Neither, looks as good to me as Gold,
Silver closed 2008 at $11.27 and finished 2009 at $16.779. I wrote in January of 2009,
Silver is about $12 and Gold is about $900, that’s a 75:1 ratio. IMO, Gold will go to $1,200. If Silver trades at 30 ounces to one ounce of Gold, Silver would be priced at $40. That’s a darn good gain!
We saw Silver trade as high as $19.295. The ratio of Gold to Silver is currently about 65:1. Suppose Gold hits $6,500 and Silver is 55:1, Silver would trade at $118!
Full disclosure: I own both Silver and Gold coins, and Gold and Silver mining shares, along with gold mutual funds and as you can see, am very bullish on Gold and Silver. Of course there are no guarantees from this end.
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Mike Landfair
[…] I, on the other hand, have just issued my Gold and Silver forecast for 2010. […]
[…] January 3, 2010 I made what some may say is an outrageous, or maybe, dumb prediction in Outlook For Gold And Silver In 2010. Here’s what I posted: Gold broke out in 2009, vaulting through $1,000 reaching a high of […]