In every historic bull market, across all asset classes, the temptation persists to call the top.
Investors often seek validation by drawing parallels to famous contrarian calls, including Michael Burry’s 2007 warning about the housing market.
This trend becomes more pronounced as prices accelerate and volatility increases, which is currently the case in the silver market.
Bitcoin/money ratio
The bitcoin-to-silver ratio currently stands at nearly 780. It is now below the 2017 peak, when bitcoin hit $20,000, and now close to the level seen in November 2022, when bitcoin bottomed near $15,500, as the ratio fell to around 700. Such convergence suggests that silver may be entering a more vulnerable phase relative to bitcoin.
Silver has surged nearly 300% over the past year. On Monday, silver fell nearly 15% after rising by a similar amount earlier in the session, briefly reaching highs near $117 an ounce before returning to around $112.
Previous local silver tops have tended to cluster early in the calendar year, with most occurring during the first half of the year. Notable examples include February 1974 and January 1980 which marked a clear explosion to $47, February 1983, May 1987, February 1998, April 2004, May 2006, March 2008 and April 2011 to $50 which was also an explosion phase.
This historic trend raises a potential warning signal about the evolution of silver prices: if history repeats itself, the precious metal could have reached its cycle peak, or even explode.
