Silver To Hit $500/oz By Summer??? | Michael Oliver

**Michael Oliver** (0:00)
Our assessment of this move in silver in particular is that it's going to a new reality. I think silver's going into several hundred dollars. May even go as high as 500, and I think it will do it by summer, summer this year.

**Adam Taggart** (0:22)
Welcome to Thoughtful Money. I'm its founder and your host, Adam Taggart. The recent price action in the precious metals, especially silver, has been nothing short of astounding. But they're no surprise to today's guest, who boldly predicted this violent upside breakout. Our questions are now flying fast and furious. How much farther are prices likely to rise? Is a vicious pullback likely soon, similar to what the metals experienced after the spike seen in both 1980 and 2011? And if so, should I start selling? Why haven't the mining stocks performed as well as expected? To address these pressing questions, we're fortunate to welcome back to the program, technical analyst and author, Michael Oliver, founder of market research firm, Momentum Structural Analysis. Michael, thanks so much for joining us today.

**Michael Oliver** (1:10)
And good to be back. Thank you very much.

**Adam Taggart** (1:12)
Well, thank you so much, Michael. And I very much appreciate you making the time to come talk to the Thoughtful Money audience here at a time where you're the man who called it all. So I'm sure your phone is rigging off the hook. I'm sure you've got a lot of analysis to be doing as things are continuing to unfold here in real time. But again, very much appreciate you making the time for us.

**Michael Oliver** (1:32)
Thank you.

**Adam Taggart** (1:33)
All right. So first off, let me just start with a massive congrats to you. You are a technical analyst. So basically, you say what your charts are telling you. But your charts were telling you something extraordinary about the precious metals last time we talked. You do a lot of, I should forget what you call it, but sort of ratio charts.

**Michael Oliver** (1:59)
Yeah. Spread charts.

**Adam Taggart** (2:01)
Spread charts. Yeah. You were looking at charts of gold to the S&P and silver to the S&P. I think when we talked, gold had just made a breakout and silver was just about to. If you said if silver breaks through that, both of those things looked like they were going to catapult higher.
You were putting some price targets out there that were pretty darn aggressive and they have been hit in a very short period of time. Congratulations. It's a real validation of your methodology.

**Michael Oliver** (2:31)
Thank you. But those targets are minimal and we're going a lot higher.

**Adam Taggart** (2:36)
We're going a lot higher. Okay. So why don't we like, well, let's get into any and all of this. So first question, which I think we probably know the answer to, but I'm going to ask it anyways. Is the breakout that we've seen in the precious metals over the past two months, since your spread chart breakouts, the actual breakouts, is that all performing as you expected here?

**Michael Oliver** (2:59)
Yes, it is. Those spread relationships, meaning it's a relative valuation chart of the ounce of gold divided into the S&P 500 price. We went back to 2013 on that chart, and you could see that basically over the last 11 years, gold has wandered sideways in value to the S&P. Ups and downs and ups and downs, but basically contained. So you can call it a par performer, meaning it depends on when you bought gold, you're doing better than the S&P, sometimes worse, but basically sideways in performance over the 11 years, which very few investors had acknowledged, but it was a fact. Anyway, that chart had a very clear ceiling on it. And you could draw like four pivotal highs that bump this line. Okay. And late last year, they closed above it, monthly closing was October, November. And since then, what happened is gold has surged in relative performance to the S&P well up out of that base. But the net price of gold has also gone quite vertical. Okay. Same thing happened with silver shortly. I think it was the same month actually, where it had a basing type relative performance to the S&P. A little bit more declining than gold had been over the last 11 years, in terms of its evaluation to the S&P. And it broke out and it exploded.

**Adam Taggart** (4:29)
Okay.

**Michael Oliver** (4:30)
So the spread chart was a technical metric above and beyond our normal analysis. Normally, what we're looking at is the momentum of price. Where we plot a price chart on the top, where everybody sees, that's what everybody sees on their screen, and below it, we plot a momentum oscillator, which takes that price chart and oscillates it versus certain moving averages, and in this case, long-term averages. And that's already been in a bull market. We know, you know, silver and gold had gone up for quite a while. So the issue is, well, why did they suddenly go berserk? Well, the reason was that signal occurred in indicating an asset class flow out of the stock market and into them.