Silver Prices Attempt a Breakout
Silver prices are continuing to rally a bit during the trading session today. Silver prices have been very range bound since the middle of August, so it’s going to take a certain amount of momentum to finally break out. If we do, I think that’s a good sign for the future. I think the next couple of days are crucial, so paying attention to the $15 level and how the market reacts that level is probably the only thing you should be focused on right now. Gold prices recently broke above the $1250 level, and if it can get some type of impulsive move to the upside, that could drag Silver prices right along up with it.
Is the Buyer’s Market for Silver Coming to an End?
Few markets are as depressed – and, as many analysts argue, suppressed – as silver. Prices for the white metal continue to languish in a low-level trading range amidst lackluster demand.
The upshot for investors is that they can now obtain silver bullion at both a low spot price and a low premium above spot.
How long this buyer’s market will is unknowable last. But given silver’s manic-depressive personality, prices could launch explosively higher at any time.
The silver market now sits enticingly close to a major upside breakout.
The weekly silver chart shows a potential double bottom forming at the September and November low points.
Silver prices will need to clear the $14.75 – $15.00/oz resistance zone before bulls can finally celebrate a rally of some significance.
For the moment anyway, value investors can continue to take advantage of fantastic bargains in the silver bullion space.
One of the top attributes of silver is its versatility. It comes in a wide range of shapes and sizes, including some that are particularly well suited for barter and trade.
Silver is often overshadowed by its pricier counterpart, gold, when it comes to discussions of sound money. Yes, gold is more likely to be held in reserve as a monetary metal for backing a currency. But silver is more likely to be exchanged by individuals in actual, everyday transactions.
It isn’t practical to pay for a cup of coffee using a gold coin. Factional sized silver coins, however, can closely approximate the prices of just about anything on a coffee shop’s menu:
A 90% silver dime is worth just over a dollar in terms of its intrinsic metal content.
A silver quarter, about $2.85.
A silver half dollar, $5.70.
A half ounce pure silver round, $9.00.
And a one ounce silver round, $16.60.
Pre-1965 90% silver coins may command additional historical/scarcity premiums above their melt value in the future. You can obtain them now at regular bullion prices, giving you a free “call option” on rising premiums.
Every silver investor should have some small denomination coins/rounds for barter and trade. Beyond that, those looking to allocate significant wealth to silver will find larger size products more cost effective and more convenient to store.
Conventional one-ounce coins/rounds are a good place to start as they are widely recognized. Most privately minted rounds are just as pure (.999 silver) as more famous government minted coins such as silver American Eagles.
The advantage to opting for products with no official coin status is they tend to carry lower premiums – thus giving you more metal for your dollar.
Serious silver stackers should consider larger bullion bars, which tend to be the most cost-effective way of building wealth in silver. Silver bars are available in 1 oz, 5 oz, 10 oz, kilo, 100 oz, and 1,000 oz sizes.
The 1,000 oz bars are generally not recommended except when holding in a Comex depository. These bulky bars are difficult to handle and ship, and, unless held in a Comex warehouse, may need to be assayed before selling.
The largest bar most investors should consider owning is the 100 ouncer. It’s not too heavy to handle and can be easily sold back to dealers.
The combination of low silver prices and low retail premiums on silver coins, bars, and rounds is a market condition that has only existed in the past 18 months. But both premiums and spot prices appear to be on the rise once again. – Stefan Gleason
Silver Prices Cheapest to Gold in 25 Years & Possible Big 2019
Spot Silver prices have fallen 17 percent this year to close at almost a three-year low, last week, while gold lost less than 8 percent after recent turmoil amidst world equity markets boosted prices at the end of October.
Credit decelerating global economic growth, mostly in China, as the culprit for affordable Silver. Silver is now the cheapest to gold, reaching a level it hasn’t seen since 1993.
With Chinese decelerating global economic growth curbing industrial demand for silver just as gold benefits from the financial market volatility-inspired safe-haven appeal, amid tightening financial conditions, investors find Silver to be at its most affordable value in nearly twenty-five years. But, it seems like this may be the ideal time to jump on Silver as many experts agree that the precious metal just might be in store for a bullish 2019.
Those watching Silver closely are predicting its price to be fairly bullish in 2019 while monitoring several indicators which could give clues on how well Silver will perform in the upcoming calendar year.
All eyes are usually on Gold as it is normally the leading indicator for other precious metals. In 2011, when gold stopped its decline, it actually started its bull market with silver later following suit. When gold goes down, silver usually does the same as well with gold outperforming when most metals are at lower rates. At major tops, however, silver tends to be the one to outperform, similar to April 2011, after which gold set its major peak 6 months later.
Right now, gold is in the process of forming a giant cup-and-handle, which could prove to be bullish for other precious metals, and silver in particular. With gold on the rise, other precious metals usually benefit. Remember, if gold is to have a major uptick in 2019, silver prices will more than likely follow suit with the possibility to outperform other precious metals
Another leading indicator of Silver’s price in 2019 is the Euro. The Euro provides many insights toward forecasts for precious metals and in recent years, the Euro has been leading the price of gold. Every time the Euro tested secular support or resistance, or broke out or down, it preceded an important top or bottom in the gold price.
The Euro has a track record of moving fast once it breaks out or down. And as the Euro does not seem to be showing or providing any negative direction towards markets, it can be interpreted as a neutral and potentially, a positive indicator toward all precious metals should it lead to a gold top and thusly a boost in the price of silver.
In addition to the two indicators listed above, another major wildcard that has been identified for possibly predicting Silver’s value forecast in 2019 could be interest rates. The Fed is expected to continue its gradual increase of interest rates in 2019 and beyond.
One of the potential scenarios is that the massive outflow out of the bond market will push capital to stocks and commodities. Consequently, capital will flow out of the US Dollar. In such a scenario we expect a sudden hit of inflation.
The big “if” here is the sudden rise in commodities and inflation indicators, which when combined, will push the price of silver much higher in 2019.
And right now, Silver is at a very fair value while Gold still sits at one of the largest price premiums in three years. At the annual G20 Meeting in Argentina, US and China relations seem to be tempering, as gold and silver prices have responded positively along with other major markets to a trade truce between the two countries. Gold prices have already jumped as of Monday, with Silver not far behind as it traded 2.2 percent higher at the end of the day on Monday. A more permanent trade deal might be made in the near future, although this outcome is somewhat unlikely, as the two countries still need to sort out multiple issues within the 90-day truce period.
With the potentiality of a bullish 2019, and silver at a very affordable buy-in, it could prove to provide decent gains to investors looking to break into precious metals. As we approach the end of the year, silver and gold are already on the rise with the potential to become quite bullish in the New Year. Keep an eye out for these indicators as a guide to cash in on precious metals in 2019. – usgoldbureau
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