How High Can Silver Prices Go?

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Mike Hammer | August 27, 2019 10:53am NYSE:SLV

silver gold bars

From Mike Hammer:


Silver continues to disobey non-believers. International silver pushed up through 18 in early New York trading, we will have to see if it can stay there throughout the US trading day. And of course, this is on top of yesterday’s pop. Here’s the chart for SLV, the unleveraged ETF most US “regular people” use to trade silver on US markets.

GE 2019-08-27 SLV 1y.jpg

(credit Fidelity.com)

For convenience, we drew a horizontal line at 15.50 (in SLV terms), right about where “everyone” said silver would hit serious resistance.

Well, it doesn’t look so serious now. Silver spent about 2 weeks just under that price before jumping up to a new range. And with yesterday’s pop, it looks like buyers are still in firm control.

When things start running up like this, your friendly Gold Enthusiast looks first at price, second at volume.  All indicators, no matter how fancy or “derivative” or “predictive” they are, depend very heavily on price and volume.  Right now silver is giving a strong showing in both of these – price is running up in a nice upward channel, and volume continues to be big on strong up-move days.

Of course, silver had a lot of making up to do. Not too long ago the gold-to-silver ratio was at all-time highs.  With silver having run up 17% since then we may no longer be in that position, but there is still a long way to go before there’s any danger of silver becoming over-valued compared to gold.

This Gold Enthusiast thinks there is still time to get in on this silver market. If you want, wait for a pullback, then buy “some” but not “all” of what you’d want to have invested. Remember that markets go both ways, and more fortunes have been lost than gained by betting the farm.  Position sizing is an important part of risk management, so keep a clear head and invest wisely!

Signed,

The Gold Enthusiast

DISCLAIMER: The author has no position in any mentioned security.  The author is long the silver sector via small positions in AGQ, PAAS and SVBL. He may daytrade around these positions but has no intentions of trading out of these core positions in the next 72 hours.


The SPDR Gold Shares (GLD) was trading at $144.62 per share on Tuesday morning, up $0.43 (+0.30%). Year-to-date, GLD has gained 16.96%, versus a 8.70% rise in the benchmark S&P 500 index during the same period.

GLD currently has an ETF Daily News SMART Grade of B (Buy), and is ranked #1 of 33 ETFs in the Precious Metals ETFs category.


This article is brought to you courtesy of ETF Daily News.


About the Author: Mike Hammer

Mike HammerFor 30-plus years, Mike Hammer has been an ardent follower, and often-times trader, of gold and silver. With his own money, he began trading in ‘86 and has seen the market at its highest highs and lowest lows, which includes the Black Monday Crash in ‘87, the Crash of ‘08, and the Flash Crash of 2010. Throughout all of this, he’s been on the great side of winning, and sometimes, the hard side of losing. For the past eight years, he’s mentored others about the fine art of trading stocks and ETFs at the Adam Mesh Trading Group.


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