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Get out of the way of silver Eagle buyers

Professionals have begun to forecast that prices are bottoming for gold and silver.

That is a dangerous game to play.

Nobody has an exemplary record of making this kind of market call.

However, one thing I can add to the discussion is that buyers of silver American Eagle bullion coins are behaving as if they believe the market has hit bottom.

Why do I write this?

Consider that silver has been trading in the $14-$15 range at roughly a three-year low.

I visited the Kitco website to look at the firm’s handy charts.

You should, too.

Everybody wants to be able to call a bottom and jump in, right?

On Oct. 2, 2015, silver leaped 72 cents to pass the $15 level.

Today, exactly three years later, silver is $14.78, up 31 cents this morning.

Silver is acting frisky.

Can it add another 41 cents and close at $15.19 by the market close today?

That could be what traders are asking themselves.

But I cannot know what is in their minds.

No one can.

What I can point out is that while silver has been trading for much less than $15 an ounce in September, buying has surged for silver American Eagles.

Since the close of the month of August, silver Eagle sales have leaped by 35 percent.

The Mint reports that sales from Jan. 1, 2018, to Aug. 31, 2018, were 9,237,500 silver American Eagle bullion coins.

The total now stands at 12,485,000.

If buyers were thinking the market has more to go on the downside, would they be making these purchases?

I don’t think so.

This is why I conclude that buyers are thinking that a bottom has been found.

Behavior is a transitory thing.

Markets can go down next week or next month, but current silver Eagle buyers are acting like they don’t believe this is a possibility.

Are they right?

Buzz blogger Dave Harper won the Numismatic Literary Guild Award for Best Blog for the third time in 2017. He is editor of the weekly newspaper “Numismatic News.”

 

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