I think the correction in gold has been within the bull-market cycle so therefore that does not constitute a bubble bursting. I tend to think there is some more corrective action to occur for gold. Gold can still come back to the 1200 region and be in an upward trend according to the 10 year logarithmic chart.
Eric Sprott indicated buying 1.5 billion dollars worth of silver last year. Why would he indicate this before the purchase bumping up the price? Is it possible that he already has this silver and wants to off-load it to the common folk through his physical silver fund? In saying that he did move into mining shares this year, the possible start of a gradual accumulation? Maybe he thinks when the next inflationary cycle kicks in (I think sometime later this year) he will get better returns with the miners?
Looking at all the charts, I tend to think gold and silver will continue down trends. Gold maybe to 1400 and silver to 20. The DOW looks ready for a correction which will drag the lot down. Probably European debt issues will be the trigger. The dollar index is currently looking very bullish according to the 5 year logarithmic chart. I think the dollar is about to run up.
It is just a hunch more than anything but I tend to think the markets will be rocked in the coming weeks, possibly because of Greek debt issues being the most likely cause. Once the DOW has a good correction then the inflationary cycle may possibly start again with a QE3 introduced later in the year? If this would happen gold and silver would sky-rocket faster than before and you may even see 50 buck silver by the end of the year.
JPM is heavily short silver as we all know. Some how I don't think they are going to be left holding the bag in the event silver sky rockets. As I understand they need to get silver down in the low twenties to significantly un-wind. I tend to think this will happen before silver ever takes off. Just my opinion and I may well be wrong. This of course is still a bullish scenario for the precious metals. I still think silver will break 50 in the next year or two.
