Steve St. Angelo: Why Technical Analysis Of The Silver Market Matters In Rigged Markets
Traders, hedge funds & institutions all study and follow technical analysis, and right now, they are...
by Steve St Angelo of SRSrocco Report
Since my last video update, the silver price has consolidated to a lower level. While I wasn't surprised to see silver continue to correct, I do believe its only temporary before it begins a new leg higher. And, if we look at the COT Report for silver, there are some positive signs going forward.
But, before I provide a preview on my newest video update, Silver Price Update & End Of A Silver Mining Era, I wanted to clarify my position on "technical analysis." There seems to be a large group of precious metals investors that have a negative KNEE-JERK reaction when I post some charts on technical analysis. They say its a waste of time to consider technical analysis when the market is rigged or controlled by the bullion banks (JP Morgan), the Fed and central banks.
While new and long-term followers are free to post any comments they desire about the pros or cons of technical analysis, my reason for doing so is to show what TRADERS ARE LOOKING AT and what they expect going forward. Traders, hedge funds and large institutions all study and follow technical analysis. Right now, they are the leading drivers of the silver price.
However, technical analysis patterns will not provide the ultimate FUNDAMENTAL VALUE for silver when the Fed and Central Banks lose control of the Fiat Monetary system and economy. Yes... at that point, technical analysis won't matter. BUT, we aren't there yet.
So, instead of precious metals investors becoming frustrated because they believe the silver price should only go IN ONE DIRECTION... UP, I am just showing how silver trades in the current system. Thus, if it falls back down to a certain key technical level before moving higher, you CAN TAKE IT OR LEAVE IT. It's that simple. However, some individuals might be savvy enough to trade precious metals and make good money doing it. Good for them. I see no problem whatsoever with individuals profiting off precious metals trading.
What I am trying to say is quite simple. I don't need to be told that technical analysis doesn't work in a rigged market. We must remember, if EVERYTHING is being manipulated, then it becomes a moot point to repeat it over and over again.
On the other hand, I challenge anyone who says that technical analysis is worthless, then why have Gold and Silver bottomed very close to their cost of production? For all of those Bix Weir Aficionados who agree with him that the Fed and Central Banks can push the price of gold and silver anywhere they please... then why hasn't the price fallen considerably below their COST OF PRODUCTION? The detractors don't seem to provide a good alternative answer.
Regardless... I will continue to provide some technical analysis to show short-term price forecasts for gold and silver. If you want to ignore it, fine, but I already understand why many of you believe technical analysis is worthless. Thanks... YOU HAVE SAID IT.
Okay then. In my newest video, I show where I believe the silver price may correct down to before its NEXT LEG higher. In a few weeks or month, I will do another update to see if my technical analysis was accurate or not.
At the latter part of the video, I do a preview on the End of the Silver Mining Era and what that means going forward for the silver market and price. I don't believe many precious metals investors realize just how important the mining of gold and silver were in the development of countless numbers of western towns in the United States. Yes, it's true that there are plenty of ex-mining Ghost towns that dot the landscape, but many have become very large cities today due to the mining of gold and silver.
And one such town in the west was responsible for the largest silver nugget ever to be mined in the world (according to written records):
A single silver nugget weighing 1,840 pounds came from the Smuggler Mine in 1894. Supposedly, the original nugget was even larger but had to be broken in pieces to be removed from the mine. According to the historical data, the silver nugget was 93% pure silver. So, if we do a bit of simple math, that nugget's ore grade was approximately 27,000 oz of silver per ton. The largest primary silver miners today are producing silver at about 10-12 oz per ton.
In doing some of the historical research, it wasn't out of the ordinary for ores in different parts of these silver mines to average 50 oz per ton, and even higher. I have seen many historical accounts showing more than 200 oz of silver per ton. Which is why the population of many of these early mining towns grow from hundreds to 10,000-20,000 in a decade or less.
The End of The Early Silver Mining Era came right at the time the world ramped up oil production. Without rising oil production, the production of silver (and gold) would have declined considerably as the world would have eventually run out of supply from high-grade mines.
Today, the world seems to have taken oil for granted. There are thousands of energy workers in each barrel of oil. Thus, the silver mining industry today would produce a fraction of the global silver without oil. In my upcoming video, I provide some very interesting data and information on tens of thousands of extra workers PER SILVER MINE would be needed if oil was removed from the picture.
IMPORTANT NOTE: This information is only for educational purposes. Do not make any investment decisions based on the information in this article. Do you own due diligence.
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