Daily Market Update

Silver $50/oz and Gold $4,000/oz Forecasts; Wholesale Premiums on Silver Bars (1,000 oz) Surge 50%


Gold and particularly silver have surged again this week with 4% and 16% gains respectively. The scale of price gains for gold and silver has been very large so far in 2020 and they are the best performing assets in the world year to date with gains of 35% and 55% respectively.

The fundamentals remain as sound as ever particularly with silver due to the continuing shortages of silver coins and bars. Wholesale premiums for large silver bars (1,000 oz) have surged 50% in just two weeks. Another indication of the continuing lack of supply and huge demand for silver bullion (more info regarding the supply of silver coins and bars below).

With both precious metals looking quite overvalued in the short term, a correction is likely. Those looking to buy for the first time or add to allocations need to dollar, euro or pound cost average into physical coins and bars. For those who are overweight precious metals you can consider taking profits on some of your holding. We would caution against selling the majority of or indeed an entire precious metal holding given the positive outlook for both metals and the very risky financial, economic and monetary outlook.

Silver and gold appear to be in a short squeeze which is propelling prices higher in a very short period of time. $40/oz and the nominal high of $50/oz are now potential price targets for silver and longer term we see the inflation adjusted record high of $150/oz in 1980 (see chart below) as a real price target.

There is no guarantee that prices will reach these levels and silver and gold should not be bought solely for the purposes of price appreciation and profit, rather they should be bought as a hedge against market crashes and closures, bank ‘holidays’, deposit confiscation and currency devaluation.

Gold and silver are vital insurance and stores of value which will protect from potential stock and bond market crashes, deposit “bail ins” or confiscation and indeed currency devaluations so securing or maintaining a position in physical gold and silver remains prudent.


◆ Own silver bars (1,000 oz) in institutional grade gold and silver vaults in Zurich at premiums as low as 4%. We cannot source smaller silver bars including kilo bars. Own Silver Britannias (1 oz) loco Zurich at 35% and for insured delivery in UK and EU at 50%. Open an account here.




NEWS and COMMENTARY

Gold tipped to reach $3,500 an ounce amid stock market turmoil (Thisismoney)

Gold rising to $4,000 an ounce ‘would not be an unreasonable move” (Marketwatch)

Silver may soar to $50/oz on Biden’s ‘green stimulus’: Bank of America (Fox Business)

Gold just hit a fresh record high — but some say silver may overtake (CNBC)

Gold steadies near record high as dollar bounces on U.S.-China row (Reuters)

Gold hits new record high, on track for ninth weekly rise (Reuters) 

World shares falter after Trump takes aim at China tech firms (Reuters) 

China’s July reserves rise to $3.15T, Gold holdings unchanged: 62.64M ozs (Reuters)

Gold will top $3,000, says this firm, one of the first to call the gold bull market of the 1970s (Marketwatch)


GOLD PRICES (USD, GBP & EUR – AM/ PM LBMA Fix)

04-Aug-20 1972.250 1977.90 1508.77 1519.62 1671.09 1686.56
03-Aug-20 1972.950 1958.55 1509.50 1504.56 1678.39 1670.45
31-Jul-20  1974.700 1964.90 1505.91 1492.54 1666.84 1661.72
30-Jul-20  1952.20 1957.65, 1503.00 1502.10 & 1662.30 1662.44
29-Jul-20  1954.35 1950.90, 1506.80 1502.39 & 1663.54 1659.24
28-Jul-20  1931.65 1940.90, 1499.15 1501.48 & 1647.70 1654.23
27-Jul-20  1940.55 1936.65, 1511.30 1504.78 & 1659.56 1647.70
24-Jul-20  1893.85 1902.10, 1486.67 1490.30 & 1631.55 1638.09
23-Jul-20  1882.35 1878.30, 1480.28 1477.47 & 1624.47 1621.54
22-Jul-20  1851.00 1852.40, 1462.85 1456.91 & 1604.82 1598.44
21-Jul-20 1823.20 1842.55, 1436.86 1449.35 & 1594.21 1608.36
20-Jul-20 1810.30 1815.65, 1437.92 1438.18 & 1580.21 1590.87
17-Jul-20 1802.90 1807.35, 1435.47 1442.45 & 1578.98 1581.07

 


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Mark O'Byrne
Executive Director

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