Silver is trying to get back into this important channel previously pointed out:
(Click to expand.)
This puts the current bull market in a similar position to 2004 in the previous bull market. In other words, it is still very early in this bull market.
If you consider the current bull market structure in this context, then it should be apparent that silver prices are currently not as overextended as many may think. It would be like saying silver at $5.60 in 2004 was overpriced.
Silver is currently only about 58% higher than its 1980 peak (the peak of the last major bull market). A major bull market does not generally end as close as 58% higher than its previous major bull market did.
Take the example of the 1970s major bull market for silver, where silver ended at around $50, about 17 times higher than the 1864 peak ($2.94). On the same basis, silver could rise all the way to $850 ($50×17) before it is at a price comparable to the 1980 high.
Here is another chart that does a similar type of comparison:
(Click to expand.)
It compares the current major bull market to the bull market of the 1970s. This also shows that silver has still much higher to go. It also shows how the current bull market is contextually similar to the one in the 1970s.
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Editor’s Closing Note: This article first appeared at Hub Moolman’s website. It is re-posted with permission. By subscription, he also has a premium service. I recommended both of them. – JWR