All indications suggest that December 2015 marked the cyclical... Gold and Silver The bottom of the bear market, since May 2011 Silver price The bear market began after gold peaked in September of the same year.

　　In the fourth quarter of 2015, Precious metals The decline in mining companies’ stock prices has gradually slowed down. As soon as a weaker player gives up and sells their shares, stronger, forward-thinking investors step in to buy them up.

　　If you select any number of mining stocks and examine their price movements on January 19, you’ll notice that on that day—most first- and second-tier companies experienced a sharp plunge in their stock prices. To illustrate this point, let’s take Endeavour Silver Corporation as an example.

　　Note how the price has made a new low and then rebounded back into the previous day’s/week’s trading range, ultimately closing higher. It’s highly likely that this low price will never be seen again during this bull market.

　　 What are physical gold and silver doing?

　　Silver has already risen by more than 40% so far this year; gold has climbed nearly 20%. Dozens—if not even more—mining stocks have surged several times over (as expected).

　　In fact, Jim Flanagan, who tracks the size and duration of the first round of bull markets across many asset classes, said this when discussing the recent months-long rally in mining stocks: Gold stocks The ticket has risen by 175% over the past 5 months and 22 days, making it the 11th-largest gain in any bull market for any tangible asset over the past 150 years. In other words, it’s an elite among elites.

　　As early as this past spring, some communications writers in resource-related sectors helped their clients get on the “right side of the trade.” However, many others exited too early at the first signs of adjustment—there were six such instances—or spent the entire year waiting for what they hoped would be a low-risk entry point.

▲ Silver Prices (2011–2016)

　　 Central banks around the world are buying mining stocks.

　　Although there are quite a few institutions, individuals, and hedge funds... Fund purchase Mining stocks and metals, while an unexpected long-term customer segment has recently emerged.

▲ The central bank net purchases gold.

　　 Deutsche Bank Germany’s (and Europe’s) largest bank—currently in a very precarious financial situation—is reportedly holding no fewer than 50 mining-sector stocks with a total market value exceeding 2 billion. U.S. dollar The Swiss National Bank holds 25. Individual stocks with a total market capitalization of 1 billion U.S. dollars. Now, the Central Bank of Norway (Norges Bank) has informed U.S. regulators that it also holds 23 mining stocks, with a total value slightly below 1 billion U.S. dollars.

　　Ironically, the world is endlessly issuing things without any backing. Currency financial institutions are now buying mining stocks as their gold. Financing Producing and trading insurance? (Not to mention that, since 2010, the central bank has been a net buyer of physical gold!)

　　The bull market could reach $26 for silver and $1,500 for gold. Gold price Achieve on-site

　　In nearly every major bull market, the public tends to arrive after the early-bird diners have already finished their feast. This time, we can make an educated guess about which price levels might “trigger” a new wave—or several waves—of physical metal purchases by newly entering investors.

　　Note that on the silver weekly chart above, a sharp decline erupted when the price first probed the $26 level for the fourth time in 2013, initiating a two-year downward trend. According to the chart’s rule, a support level that has been broken becomes a resistance level during any subsequent pullbacks.

　　Therefore, a reasonable expectation is that the $26 level will serve as an important (initial) resistance to upward price movement. Once the $26 mark is decisively broken to the upside and forms a solid base above it, the price will then have the potential to accelerate its upward trajectory.

　　We have listed certain “indicators” that we believe will mark a significant increase in public engagement with precious metals. These include:

　　■ Gold prices have broken above the $1,500 to $1,900 per hundred-dollar level and turned it into support (HSR).

　　■ Gold prices have broken through $2,000 and, following a pullback, have confirmed the successful bottoming out.

　　■ As the silver price breaks upward from $25 to $45, each $5 increment in the price level acts as a support (HSR).

　　■ Silver prices have broken through $50 and, following a pullback, have confirmed the successful bottoming out.

　　■Once these upward resistance levels are successfully broken and turn into support, the vanguard of the public frenzy begins to take shape. 2017 is most likely to be the year when the stage of public recognition officially kicks off.

　　■ Gold (> $2,000) and silver (> $50) have reached nominal all-time highs, spurring greater public participation and leading us to believe this will be the final and largest rally for precious metals and related stocks.

　　As these events unfold, Physical gold The impact of silver’s availability (and the resulting rise in premiums) will be profound.

　　As gold and silver hit nominal all-time highs, several scenarios are beginning to unfold:

　　■ Precious metals are becoming increasingly difficult to find as available supplies dwindle.

　　■ More counterfeit gold bars and “collectible” gold coins and bars are circulating in the market.

　　■ First, gold prices—and then silver prices—rose to the point where few people could afford to buy large quantities. The ratio of market supply and the premium over spot prices expanded significantly.

　　The period from August to September just past saw a much-needed and timely adjustment, as metal and mining stocks have risen too rapidly this year. If, like us, you believe that the new bull market for gold and silver will last at least several years, then it’s the right thing to do to rein in your emotions, add to your positions, or open new ones—because that’s precisely what’s called for.

　　Adam Hamilton provided an excellent summary, clearly distinguishing between investors who are actually performing well and those who are merely hoping, planning, and observing when presenting key points. Adam said:

　　Buying low is not easy. Whenever frenzied selling occurs at key price levels, there’s always a chance that prices will fall—even lower. Thus, it’s extremely psychologically challenging to go against the crowd and buy when everyone else is selling. Buying during these terrifying sell-offs feels almost unbearable. Only by maintaining the steely composure and unwavering wisdom required can one resist the urge to join the selling frenzy.

　　Even if you’ve done your research and decided to participate, resisting public sentiment—and your own emotions—by buying when prices are weak is no easy feat. Yet time and again, some of the world’s most successful investors have managed to do just that. You might want to consider joining their ranks.