{"id":148641,"date":"2019-05-29T11:25:03","date_gmt":"2019-05-29T15:25:03","guid":{"rendered":"https:\/\/www.countingpips.com\/?p=148641"},"modified":"2019-05-29T11:25:03","modified_gmt":"2019-05-29T15:25:03","slug":"when-silver-has-a-bitcoin-moment","status":"publish","type":"post","link":"https:\/\/www.investmacro.com\/forex\/2019\/05\/when-silver-has-a-bitcoin-moment\/","title":{"rendered":"When Silver Has a “Bitcoin Moment”"},"content":{"rendered":"
May 29, 2019<\/div>
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By Money Metals News Service<\/b><\/p>\n

In mid-May 2019 the leading cryptocurrency, Bitcoin (BTC), was trading around $5,600. At $4,000, a prominent technician predicted it was gearing up for a run to $6,500. Yet when it reached $5,700, he recommended selling because of a technical “non-confirmation.”<\/p>\n

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\"BTC<\/p>\n

Courtesy BTC app and Tom Hartel<\/i><\/p>\n<\/div>\n

As if on cue, BTC began an epic upside run, easily slicing through his initial target! Following an $8,600 print, the price cratered to $6,600, then back to… $8,400! Who knows where it will be when you read this, but I suggest that there is something important to be learned here\u2026<\/p>\n

The moral of this little tale<\/b> is that when holding a position like physical metals, which has gone through a lengthy underperformance, the tendency is to liquidate it at the first sign of a strong price rise.<\/p>\n

But you might also be selling out of what becomes an epic bull run. There’s just no way to know for sure ahead of time.<\/p>\n

It’s absolutely vital to “take some profit” as long as you distinguish between “speculative” and Core holdings. Don’t sell the Core until you feel strongly that the secular run is coming to an end.<\/p>

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In 1999, Warren Buffet publicly stated that he believed the stock market bull was over. It lasted another year, but since he “got out too soon,” he was able to side-step the carnage that followed.<\/p>\n

A number of years from now, evidence may indicate you should sell all but your insurance portion. Even if the top is higher, but you manage to take a big bite from the middle, that’s great!<\/p>\n

I personally knew of such a “sandwich trader’ \u2013 a Canadian who bought silver futures and physical metal at $7, selling ALL of it at $18. Of course, the price eventually went to $50 in early 1980, but he never looked back; never tried to buy in again. By sticking to his plan, he literally made and kept millions.<\/p>\n

Others, who got in much higher (or lower but never sold) saw silver decline precipitously from $50 to $10.80, and then rally to $25 (the classic 50% retracement), before slowly sinking to $4 over the next two decades.<\/p>\n

Could Silver experience one (or more) “bitcoin moments”?<\/b> I believe the answer is “yes.”<\/p>\n

Conceptually, some similar elements are in place. From mid-2011, silver has experienced a lengthy, corrosive decline. In December 2017, after bitcoin topped near $20,000, it (like silver) established a series of lower lows and lower highs under a flood of negative press – classic behavior during an entrenched bear phase.<\/p>\n

No one has predicted that silver will go to zero like they have for bitcoin (because silver literally cannot), but a chorus of worn-out bulls and perma-bears still opine that the metal is either destined to flat-line forever or have any rally capped by “da boyz” on Wall Street or the Federal Reserve.<\/p>\n

If you feel this way, consider that silver alone among the metals has yet to exceed all-time nominal highs above its futures basis $52.<\/p>\n

More to the point, don’t forget the twin cautionary points long espoused by David Morgan<\/a>:<\/p>\n