Bullish Silver Indicator Is Flashing! (Uncut) 02-16-2025

Bullish Silver Indicator Is Flashing! But It’s Happening Outside Of The USA – For Now!

Hey everyone, welcome to BaldGuyMoney, I am BaldGuy, and we had another big week for gold and silver, with gold closing a new all-time weekly high at $2,882 per ounce despite the big pullback we saw on Friday, which as you can see from my X post here, definitely didn’t have anything to do with a coordinated market sell-off or market manipulation. Now moving on to silver, which was also up on the week more than 1%, it disappointed a lot of people with a huge rejection on Friday at the key resistance level of $32.60 per ounce, keeping us about 8% below the October 2024 high of $34.83 per ounce, and forcing us to wait a bit longer for the big breakout I have been saying to look out for in the second half of 2025, which I expect to take us up to about $40 an ounce. That said, this correction has set gold and silver stackers up to benefit from a nice short-term pullback.

And as a side note, I will be watching price development carefully over the next two weeks, looking for entry points to get a little more aggressive with my DCA should we see prices pull back a little bit more. Anyhow, despite some short-term technical headwinds, I am starting to see some behaviors in the gold and silver space that admittedly, after 16 years of stacking, I have never seen before. Because with the gold to silver ratio well above the 30-year average, where people have usually been eager to trade gold for silver at times like this, I am literally hearing about people trading silver for gold.

Someone recently mentioned it in my Patreon Discord group, and I even saw somebody do it on a recent video from the Yankee Stacking channel, and I think it’s a huge mistake as well as a great contrarian indicator. And it’s exactly what I want to talk about in this video, because I am starting to see major indicators suggesting an imminent retest of the $35 level and a potential breakout to the $40 level for silver, all at a time when people are starting to give up. So we’re going to start this video by covering some of the investor psychology that influences silver price, and I am going to show you the first clear example of retail investors panicking to get silver that we’ve seen in years.

I’m going to cover some of the supply issues that we’ve been covering, but also a couple new considerations when it comes to the supply and demand dynamics for silver. Once that’s covered, I am going to show you all how soon we may see the breakout in the price of silver to make sure you’re prepared for what’s coming. And we’ll finish this video on the topic of gold revaluation, what it is, what it isn’t, and how it can potentially impact gold miners and the value of mining stocks.

Now, just before we dive in, please remember to check out summitmetals.com if you want to buy gold or silver at a great price from a dealer you can trust, like these 1 oz gold eagles which are now below $3,000 again, or 1 gram Scottsdale mint bars at the lowest price I’ve seen. And while you’re there, remember to take advantage of the 5 oz of silver at spot deal for new customers when you use the code newcustomer at checkout, and I will leave the links to these deals in the video description below. Okay, so, jumping into it, when it comes to silver, it’s important to understand the investor psychology, because, and this stat may surprise you, but over the last two years, as the price of silver has been going up, reaching its highest average closing price since 2012, it has happened on the backdrop of falling physical investment demand, and this tells me two things.

The first thing is, silver doesn’t rely on physical investment demand nearly as much as it once did for prices to rise. Its status as a key ingredient in industry is securing demand for the metal. But point two is, once those retail physical metals investors finally wake up and decide that they want to buy silver bars or silver coins again, the squeeze on price is going to happen quickly.

And with gold making new all-time highs not only in nominal terms, but according to official data, the price of gold is now at an inflation-adjusted all-time high versus the $2,750 per ounce price that we saw inflation-adjusted from January 1980, the return of physical silver investors is imminent. And I spoke about this with famous commodities investor Rick Rule about a year ago, and this is what he had to say on the topic. The people who are afraid save in gold.

They save as catastrophe insurance. In my experience, a precious metals bull market is led by the fear investors, so gold moves first. When the narrative has been validated by price action and the generalist money comes into the sector, generalist money is greedy.

And they come into a more volatile commodity with a lower unit price, which is to say silver. History teaches us that the bull market is led by gold, and then perhaps midway through the market, although all things are happening quicker today, silver takes over leadership, and then it moves further and faster. Now at the start of the video, I said I had observed what is possibly the first example of this retail rotation from gold into silver driven by higher gold prices, and here it is because in South Korea, we’ve seen a massive shock to the availability of silver with investors flocking to it, partly driven by price, and partly driven by concerns about shortages like the ones they’ve already experienced with gold bars.

And let me add that in Poland, which is where I live, I am also seeing the supply of silver running very low, in sharp contrast to what I’m hearing from the United States, with most retailers completely sold out of bars and a very limited selection when it comes to bullion coins. And just two days ago, I saw this article from the leading financial publication in Poland, asking if silver is going to be the next gold, so as far as I am seeing things right now, we are starting to see the psychological factors that Rick Rule mentioned in that clip starting to appear, albeit it’s still early days. So with the psychological factors addressed, and an understanding that we could be seeing those triggered right now, I think it’s important we take a sobering look at the ongoing silver supply deficits, because as a result of lack of investor interest in miners and growing industrial demand, silver deficits, which measure how much more silver we use compared to what is mined and supplied to the market every year, are reaching the highest levels since 2020, when mines and refineries were all shut down.

So when looking at that 2024 deficit, which shows that we used 265 million ounces of silver more than what was supplied to the market, just imagine what that number could be once retail investors return to the market and start buying silver, and $3,000 an ounce gold drives many people in the jewelry market also out of gold into silver. Because all else being equal, if we saw investor interest in silver and jewelry demand return to 2022 levels as a result of higher gold prices, we could see an extra 150 million ounces in demand for silver, pushing the silver supply deficit to above 400 million ounces in an environment where traditionally uninterested parties are starting to take interest in silver again. And that includes banks, which are scrambling to get silver to cover short exposure due to tariff threats, as well as central banks, as I recently discussed with Josh Fair from the Scottsdale Mint, which may consider adding some silver to their reserves if the war against the US dollar continues to escalate.

So in a nutshell, this is why I think it’s a big mistake to trade silver for gold right now, and I’ll go as far as saying, if you want some gold, just buy it. And if you’re strapped for cash, sell something other than your silver to fund the purchase of gold, or settle for smaller fractional gold pieces for now. Because the buildup we are seeing for silver on both the technical side, with the average closing price of silver above $30 per ounce for the first time since 2012, and the macro side with a wave of new demand poised to enter an already squeezed market, this tells me that we are gearing up for big moves, whether we experience a temporary pullback here or not, because silver is showing us that it is already on the move.

And for those of you questioning whether economic recession in the US will hold silver back due to weaker industrial demand, just remember that industrial demand from China seems to be on solid ground due to their economic stimulus package, which is also fueling a rebound in Chinese stocks. Now to get to the most important bit of this analysis, when might we expect to see the price of silver make that next big move up? Because gold is already broken out once again, it’s knocking on the door of $3,000 an ounce, but silver, as it does because it follows gold, is still waiting to catch up. Well, let me start by saying this metals market has progressed much quicker than I had expected it to, and I still think we’re going to see the biggest moves in the second half of 2025.

And I’ve spoken a lot about that, I’m not going to revisit the topic here, but if gold remains strong and dollar demand weakens, potentially due to tariffs resulting in less international business transactions with the USA, as my friend over at the 2is1 channel recently suggested might be the case, then we could see a breakout in the price of silver as soon as mid-April, which could be a breakout above the $32.60 level, sending it back into bullish territory, or potentially even above the $35 per ounce price level, setting silver up for a shot at $42 per ounce by year end, which was my 2025 price presented to you all last year. Now, coming back to this average price data, let me just say that giving up on silver now in the early stages of a big breakout doesn’t make any sense to me, and that includes trading silver for gold, even though I use the majority of fiat that I allocate towards precious metals for gold. This data here shows us the 2025 average closing price for silver is 123% above the average closing price since 1990, and tells us that silver, despite all the accusations of underperformance, which I fully understand by the way because some YouTubers set unrealistic expectations in the community, silver has still protected faithful stackers from inflation over that period of time.

And remember, we’re not counting from 1990 to today, but from 1990 and every year in between from then and now, on the money put into silver to arrive to that conclusion. And that even includes 2011 and 2012, when prices were higher due to major financial panics happening around the world, as well as a very weak U.S. dollar, which was around 75 on the U.S. dollar index at the time versus 107 where we are today. And part of the reason why you are seeing silver at 2011 all-time high prices already now in other currencies like the Australian dollar, which you see here, despite the fact that it still hasn’t gotten there in U.S. dollar terms.

But as I have presented in this video, I think it will, and we’re not far off. So with that covered, it’s time to move on to this video’s viewer questions. And I say questions because I am answering two questions this week, both on the topic of gold revaluation with one coming from X and the other one coming from the YouTube comments section.

And the first one I’ll cover is the one from X, from someone who goes by NHHODLBTC, which I guess is just proof some of these crypto guys are interested in precious metals. And the question, and I’ll paraphrase it a bit, goes like this. Will Trump take the U.S. dollar back to the gold standard, sending the price of gold to between $50,000 and $70,000 an ounce? And it’s a question I’m getting quite often these days because as I covered in a recent video, if the United States wanted to back up all of its debt with its gold reserves, gold would have to be revalued.

And this number you see here is an updated number reflecting current levels of debt to nearly $140,000 per ounce. And it’s something more and more people are expecting to happen with the influx of so much gold to the United States. And talks of monetizing the asset side of the United States government balance sheet.

But as I like to do, I have to add a dose of reality to this story because nobody is really talking about revaluing gold to back up all U.S. debt except for people in the precious metal space who either selfishly want it to happen or are looking for clicks on their videos for all the wrong reasons. But with that said, there is still a major bullish element to this storyline, even though the U.S. dollar is not going to be backed up by gold again. And here it is.

What the United States is talking about doing is marking the value of the gold reserves they have, which are currently valued at $42 per ounce to the market price of gold, which is $2,882 per ounce or wherever the price may be when they perform that revaluation. And the reason they’re doing that is because with the interest expenses on U.S. national debt now above $1 trillion a year, and we’ve covered it in some recent videos, revaluing the gold would allow the United States to borrow $750 billion against the gold, using it as collateral at a lower interest rate than what the market is currently offering because the debt would be backed up by the gold, which means less risk for the lender, thus a lower interest rate, kind of like why the interest rate on a home mortgage is lower than on a credit card because the mortgage is backed up by something or collateralized by the house. And what the U.S. government can do with that money is they can pay down high interest debt with that lower interest money, making that interest on debt payment problem that they have right now less of a problem.

And it also means that countries around the world that are holding large gold reserves, the topic we touched on in last week’s video, can do the same and start monetizing their reserves and borrowing at a lower rate of interest, turning the gold reserves into working capital, and that’s huge. But instead of seeing gold revalued to insane levels to cover all debt, it’s huge because what it actually does is it strengthens the floor under the price of gold because it eliminates the incentive for countries and central banks to sell the gold that they hold because now they can unlock the value of it by simply borrowing against it using collateralized loans at a low interest rate. And that is the reality of what’s happening here.

Now moving on to the second question, and it comes from Chris Bivona, who is a Patreon member and commented on the video that I did last week with this question. He asked, how would revaluation impact the price of gold mining stocks? And this is another great question because I recently scaled my mining positions up by about 12% and I shared what companies it is that I bought and how much of each one I bought on my Patreon. But the reason I decided to do that was because we are seeing miners realizing higher average prices for both gold and silver, and what you’re looking at here are the moving averages for gold contracts right now.

And you can see that as the timeline gets shorter, the average price of gold is going higher and the same thing is happening for silver. And this has already delivered positive reactions for mining stock prices like Barrick Gold, which recently reported strong earnings, because price sustainability has been a major concern of mining stock investors since the 2011 blowoff top and has kept many people simply away from the sector. But a guarantee of sustainable prices at a higher level, driven by a strengthening of gold’s price floor, would result in even more sustainable earnings for miners as well as higher stock prices.

So with the GDX running into some natural price resistance right now as we retest the October 2024 highs, I see opportunity here and am looking to possibly scale up once more if we see a pullback from here because a revaluation of gold would send these mining stocks way up, not because of a magical higher price that somebody determined based on a debt calculation, but because of a stronger price floor. So with that covered, that’s it for this video. I want to thank you all for taking the time to watch.

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See you in the next video. Goodbye.