Picking a 'target price' for precious metals
(Read article summary)Two types of bloggers will argue that there's no need to come up with arbitrary targets
What's your "target price" on the precious metals? How much ink has been spilled by those pontificating on exactly that question. There are two types of bloggers who will tell you there is no need to pick arbitrary targets in this particular bull market:
1. Real Traders
2. True Believers
Only journalists or analysts waste their time coming up with a number and then reverse-engineering a fundamental rationale for something like the gold or silver bull market. It's OK to have a hypothesis (mine on silver is low- to mid-50's before a bludgeoning - purely a guess based on psychology).
But to say "Here's the target because of fundamental factors X,Y and Z" during a phenomenon like this is patently absurd.
Still unconvinced and in search of THE NUMBER? I have two takes on this oh-so-unanswerable enigma of precious metals targets - one from a real trader and one from a true believer, both are equally valid hypotheses and make way more sense than those coming up with "valuations" or "price objectives".
First, the High Chart Patterns blog on looking for a top as sport or skill-sharpening practice:
It’s like picking up dimes in front of a bulldozer. Really. But it is a lot of fun. And for the most part the way we trade is pretty conservative. Once in a while we need to let loose. This is the time for us. It’s also a very good exercise for keeping our skills sharp. Kind of like extreme sport. Timing has been everything, and there’s not much room for error if you want to get the trade right. It’s not forgiving the way a break-out on a trend-day is…
Many traders we know are doing the exact same thing which is kind of funny. And scary.
