Silver, silver, and silver – that’s all there seems to matter to the more short-term oriented investors. But, there’s so much more that’s going on than just the rally in the white metal that just got invalidated! The dynamics in the precious metals market extend well beyond the above and the signal that’s coming from silver – as important as it is for the short run – is just one of many puzzles that create the entire precious metals picture. In today’s analysis, we’ll discuss the less popular, but still important factors that are worth considering whether one is investing in gold, silver or mining stocks, or just considering it.

This article is based on numerous questions that we received in the past several days from our subscribers. It’s quite likely that they represent the questions and doubts of many other gold and silver investors, so we thought that you’d appreciate getting to know replies and insights from those, who’ve been investigating this exciting and promising market for more than a decade. Let’s move right to them.

Q: Does your analysis take into account global gold and silver ETF holdings and additions?

A: Yes, we analyzed this issue and we found that the moves in the ETF holdings are the result – not the cause of moves in the price of gold. For instance, just because the GLD ETF added a billion dollars in new money doesn’t make the outlook any more bullish than knowing that the price of gold increased.

Is an increase in price always bullish? No. For instance, a rally on very low volume is bearish and the same goes for silver’s quick outperformance. Also, please note that one wants to sell close to the tops, not bottoms and tops are formed after the price increases. Were the GLD ETF flows tiny before the 2011 top? Of course not.