Gold Market Wire
News, analysis and commentary for gold traders and investors
Silver Market Update
Silver Continues to Struggle
September 24, 2021 - (Gold Market Wire) - Silver is not recovering, although the important floor at $22.00 continues to hold. Right now, all eyes continue to focus on the stock market, which has recovered yesterday, but is being challenged in the European a.m. - with Germany and France both down 1%. Without a further advance in equities the Metals will, as we feared, struggle to recover. It seems like market participants are essentially frozen in fear that a massive October sell-off could be coming, and until the end of that month has passed, nothing is going to cause the Metals to move, short of an unexpected, miraculous stock market turn-around higher. At the center of the paralysis is the wait for news on Chinese property developer Evergrande, which has missed a foreign-holder coupon payment, and looks like it may default. With possibly no bailout coming, the market is on tenter-hooks - awaiting news.
The chart lays out the weak position of Silver, and, by extension, Gold.
The always hopeful bulls can take heart from the fact that $22.00 has held. But our downtrend lines have as well. We're stuck, waiting for the equity close. If the stock market sells off, it is likely that we will see the back of $22 and start the next leg dow. The bull market is still alive, but this is no place for length. We're be-calmed on the sidelines, and are likely to be for some time until the full scope of the Evergrande problem is resolved - one way or another. Markets hate uncertainty, and that is all there is right now.
It is worth noting that if the Chinese authorities let Evergrande fail, the market is likely to taken a large hit. That hit, we feel, will probably provide an excellent buying opportunity for Metals and Equities alike. A proper default is just what we need - not a Paulson bailout, which really, in retrospect, can be seen as the starting point for the end of the western economies, whose peak has been reached, and whose recovery is not coming, no matter how much everyone re-assures themselves. We are in the midst of historical change of once in a 300-year period. The Chinese can seal their future as the number 1 economy for the next 300-year period, by letting Evergrande go. The question is - have they learned from the West's demise?