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Here Is What Happened and Will Happen Again

As an investor in the precious metals sector no doubt you are getting tired of waiting and probably on the verge of giving up. In our opinion, don't.

Yes, while many analysts, including us, are optimistic of a great explosion in the share prices of most precious metals shares, our timing has been elusive.

Fear is everywhere and everyday we hear that the PM markets will meltdown once again following the financial markets down and then investors will have the last great buying opportunity. We admit a major turn down in the financial markets could happen but we are not sure that the PM shares need to decline as well. And we ask, what if the meltdown does not come and the PM's take off to the upside leaving many investors on the sidelines?

If you have been investing in this sector for a few years you are probably not making money except in unique company situations. The fear and losses incurred in late 2008 still weigh heavy on the portfolio of investors.

Until new money enters the markets or investor sentiment changes dramatically our dreams of a full blown bull market will continue to elude us but markets and sentiment can change very quickly.

We want to take you back to August 1979 and show you where gold and silver were trading. Remember the highs were reached only 6 months later.

Gold 1978-1983

Look closely at this chart of gold as in August 1979 it was trading at around $300 an ounce. In January only 6 months later gold touched $850 an ounce. Thus a multiple of 2.83 was achieved in only 6 months time.

Now let's look at silver:

Gold 1977-1981

Again look closely and you will see silver in August 1979 was around $9.50 an oz and in six months spiked up to let's say $45. The multiple here being 4.73 thus outperforming gold in this timeframe.

Our point is that gold and silver can soar greatly in a very short period time and we believe this could very well happen much sooner than most investors and analysts would expect.

Gold projection
Taking the above multiples and using a current gold price of about $1210 we could see gold spike up to $3424.

Silver projection
With the multiple of 4.73 for silver and a current price of $18.30 we could see silver spike up to $86.56

We realize these projections are difficult for many of you to believe but the markets have the ability to turn on a dime and we believe there is better than a 50-50 chance once again in this August 2010 to January 2011 timeframe for a major move.

Somewhere in this move the PM shares and of course and warrants trading on those shares will be exploding upwards in price.

Worst Case Scenario
For those investors already loaded up with shares or warrants we urge you to be patient. Yes, our timing could be off but we believe this major move will happen within the next two years but probably in the next 7 months.

For new investors we suggest you finish your shopping for PM shares soon and get ready. We're going to have some fun.

What is our worst fear? Selling too soon as it will be difficult to ride this wave up to the top.

 


For those readers unfamiliar with our services:

  • PreciousMetalsWarrants.com provides an online database for all warrants trading on the natural resource companies in the United States and Canada.
  • InsidersInsights.com tracks the buying and selling of corporate insiders with a focus on the junior mining and natural resource sectors. Buy and Sell Alerts are issued as deemed relevant based upon our analysis.

We encourage all readers to sign up for our free weekly email.

 

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