Silver $965310 (+1,02%) has dropped a lot the past few months. The hype has mostly died down and the gold/silver ratio is rising again.
However I see a few reasons why the bottom might be in and the bull market might continue soon:
- Solar panel demand in europe has increased by 50% since the iran war. Higher oil and gas prices push people and companies toward more reliable and sustained electricity sources like solar. Remember that each solar panel contains around 20g of silver. The silver market has been in a production deficit for 6 years now, this will continue.
- The market is currently pricing in a rate hike by the FED. If that ends up not happening (the US can not pay its rent obligations if that happens) the market might prefer gold over us bonds again, which could end the correction in precious metals.
- Silver is now down almost 50% since the top in January. Investor demand is picking up again as people are buying the dip.
It's been tough to hold silver all the way down during this correction. In January the price almost hit my first profit taking target. Now I wish I took some profit. However, I do believe the bull run is not over for precious metals, and when the uptrend continues, silver will probably outperform again. I'm buying a few ounces this week.
What are your thoughts on the precious metals correction? Is the bull market over?
