In the early morning trading of July 7th silver experienced a flash crash down to approximately $14.35 and returned to above $15.50 within seconds. Guildhall looks at how this event was perpetrated and what is the reason behind the sale $450 million dollars worth of silver. Does this signal the bottom in the silver market or are flash crashes the new normal in precious metals?
Prediction for Gold
In a Fox interview, the Terry Duffy CEO of the Chicago Mercantile Exchange (CME) stated that he believes that “given all that’s going on in the world the price of gold should be priced $5,000-$6,000 per ounce. This given the current economic situation.
Supply/Demand
Total silver mine supply declined in 2016 to the lowest level since 2013. Silver mine production is down in 2016 for the first time in 14 years. Demand from investors is putting stress on the current supply of silver. Going forward industrial usages like batteries in electric cars is just one major source of demand for silver going forward. Guildhall is experiencing long wait times for order of physical silver to be filled. If the there were no demand for the metal which the price might demonstrate, there should not be a lack of physical supply.
