All ETF Daily News Articles

Will Silver Reach $20 in 2020?

NYSE:SLV June 11, 2020 1:18pm

Gold Miners Index: A Pivotal Level For The Bulls

NYSE:GDX June 10, 2020 2:00pm

Natural Gas Could be Setting the Stage for a Recovery

NYSE:UNG June 9, 2020 12:09pm

Will Crude Oil Prices Continue to Gain Momentum?

NYSE:USO June 8, 2020 3:53pm

Natural Gas: What Price Momentum & Relative Strength Indicators are Telling Us

NYSE:UNG June 4, 2020 1:35pm

Is Silver Overbought?

NYSE:GLD June 2, 2020 12:33pm

Natural Gas: 2 Reasons To Buy On Dips

NYSE:UNG June 2, 2020 12:19pm

Will Crude Oil Continue to Rally?

NYSE:USO June 1, 2020 11:42am

2 Bullish Factors That Could Support Natural Gas Prices

NYSE:UNG May 28, 2020 12:57pm

Silver Prices are at a Pivotal Juncture

It's been yet another busy week in the markets with jobless claims topping 2 million yet again and the equity markets putting together two massive back-to-back advances the Memorial Day Weekend. While the equity market strength has taken a little of the shine off of gold (GLD), with the metal tumbling nearly 2% yesterday at its lows, it's done nothing to affect the price of silver (SLV), which is working on its 4th consecutive weekly gain in a row. This strength in the silver price continues to be encouraging, and especially it's relative strength against the yellow metal, as the best gains for the precious metals come when silver finally begins to outperform. It's too early at this juncture to say we have clear outperformance, but the past couple weeks are encouraging, as is the fact that small speculators still have minimal interest in the metal. The strongest bull markets start on disinterest and slight pessimism, which is what we're seeing in silver for the time being, despite an 18% return for May thus far. Let's take a closer look below:

A picture containing table, water, light, cake Description automatically generated

(Source: CFTC.com, Author's Chart)

Beginning with the small speculator positioning in silver, we continue to see a massive divergence here, as should be quite apparent to those looking at the chart above. Over the past twelve months, the silver price rarely ever crosses up through the 1-month moving average of small speculator positioning (blue line), but, currently, we have long positioning among small speculators moving sideways while silver has seen a relentless bid under it the past few weeks. This suggests that there is minimal interest in this rally for silver thus far, explained by the fact that the small speculators were delivered a severe blow in mid-March as the price of silver plunged. Worse, this occurred while small speculators were holding their most significant long position in nearly two years. These fresh wounds are likely deterring them from rushing back into the trade, and this is allowing the smart money to accumulate while the small speculators stay on the sidelines nursing their injuries. Ultimately, though, these small speculators will return, as they always do, and this will provide fuel for the next leg higher in silver.

While some might believe that a lack of participation in silver from small speculators is a bad thing as we want to see lots of buying from smaller traders, it's, in fact, the opposite. Instead, we want to see the small traders sidelined as long as possible, as they're often wrong at the turning points, and they often create the tops and bottoms. As long as these small speculators remain on the sidelines, as they did last week with the 1-month moving average staying below 27,000 contracts, those long silver can remain comforted that we could very well head over $20.00/oz before year-end.

A screenshot of a computer Description automatically generated

(Source: TC2000.com)

If we move over to the technical picture, we're at a pivotal juncture here, as silver is testing its long-term downtrend line near $18.50/oz. The good news is that the metal has jumped back above its long-term moving average (teal line) on a weekly close, and this is the fourth test in less than a year of this long-term downtrend line. Generally, the more times a level is tested, the more likely it is to break, and while we may not break out here, a breakout through this downtrend in the next few months looks inevitable. This would be a very bullish development for the bulls as it would move the monthly chart back to bullish alignment from neutral currently. It would also be a big deal for the silver miners themselves, as the average all-in sustaining costs among silver miners are near $12.00/oz. A move above $20.00/oz would be a massive tailwind to their after-tax profit margins, which remain razor-thin currently.

So, what's the best way to play this?

While I wouldn't be rushing to pay more than $18.50/oz for silver, I do believe that any 8-12% pullbacks in silver are likely to provide buying opportunities, and I continue to watch the leaders in the silver space for new entries. Currently, I remain long Silvercrest Metals (SILV), the first silver stock to head to new all-time highs, and I would be very interested in going long silver if we could see a pullback closer to $16.40/oz. For now, I see the metal as a Hold. There are few things more bullish than a market that continues to trend higher with limited participation from small traders, and this is what we continue to see for the fourth week in a row in silver. For investors interested in accumulating the metal, corrections below $16.40/oz are likely to be buying opportunities, and there's no reason to fear a drop below $15.00/oz as long as the small speculators continue to remain disinterested in this trade from the long side.

(Disclosure: I am long Silvercrest Metals (SILV))

Disclaimer: Taylor Dart is not a Registered Investment Advisor or Financial Planner. This writing is for informational purposes only. It does not constitute an offer to sell, a solicitation to buy, or a recommendation regarding any securities transaction. The information contained in this writing should not be construed as financial or investment advice on any subject matter. Taylor Dart expressly disclaims all liability in respect to actions taken based on any or all of the information on this writing.

Want More Great Investing Ideas? 9 "BUY THE DIP" Growth Stocks for 2020 Beware 3,000 on S&P? 7 "Safe-Haven" Dividend Stocks for Turbulent Times
The iShares Silver Trust (SLV) was trading at $16.25 per share on Thursday morning, up $0.10 (+0.62%). Year-to-date, SLV has gained 1.63%, versus a 14.74% rise in the benchmark S&P 500 index during the same period. SLV currently has an ETF Daily News SMART Grade of C (Neutral), and is ranked #14 of 34 ETFs in the Precious Metals ETFs category.

About the Author: Taylor Dart

taylor-dartTaylor has over a decade of investing experience, with a special focus on the precious metals sector. In addition to working with ETFDailyNews, he is a prominent writer on Seeking Alpha. Learn more about Taylor’s background, along with links to his most recent articles. More...
NYSE:SLV May 28, 2020 11:56am

Using a Scale-Down, Scale-Up Approach to Trade Natural Gas

NYSE:UNG May 27, 2020 2:35pm

Should Investors Buy Gold Miners on This Pullback?

It's been an incredible start to the year for the Gold Miners Index (GDX), with the index up 21% year-to-date, outperforming nearly all other asset classes thanks to lower oil prices and continued strength in the gold (GLD) price.  While the index was briefly derailed in March following overall market turbulence, it has since soared to new multi-year highs and is working on its strongest quarterly gain ever, up 55% for Q2 thus far. In the past decade, these brief spurts of relative strength have been short-lived, with the S&P-500 (SPY) clawing back to outperform the miners and reassert control over the Gold Bugs Index to S&P-500 Ratio. However, this time around looks like it might finally be different, as the miners continue to digest their gains in a normal fashion, and have broken out from a multi-year range last month. Based on continued fundamental tailwinds given the miner's lower costs and higher average selling price and a robust technical picture, I believe the sector is one to watch closely, and one to buy on dips.

Beginning with the below chart, a relative strength gauge of the Gold Bugs Index and the S&P-500, we can see that the miners have been out of favor for years, consistently losing ground to the S&P-500. This is quite important, as while owning miners certainly has made sense if they're stair-stepping higher, it's made less sense if the S&P-500 companies are stair-stepping higher at a brisker pace. Therefore, the gold miner trade has made little sense other than a hedge, and this has been a headwind for getting investment dollars into the metals complex. However, we've seen a massive shift in this ratio over the past six months, as the ratio has finally broken above its long-term moving average (yellow line), and seems to be holding above this level with ease the past few months. This is not what we saw in 2016, and the index ran up towards this moving average and then crumbled almost immediately. This shift to a bullish posture for this ratio has significant implications over the medium-term, and potentially long-term for the gold miners, as long as this index remains above this key moving average.

A picture containing green Description automatically generated

(Source: StockCharts.com)

If the bullish shift in the above ratio occurred due to a crash in the S&P-500 that was not recovered, I would slightly discount this shift. However, this is not the case currently. While the Gold Bugs Index made massive headwind against the S&P-500 given the crash in the major market averages, the S&P-500 has been steadily melting higher since, meaning that the Gold Bugs Index would have to show significant relative strength to maintain this bullish flip in the ratio. This is exactly what the index has done, and it's been one of the first asset classes to break out to multi-year highs. Based on this, it's clear that this is not a brief mean reversion like 2016, or a false start in the index; instead, this points to a higher likelihood that this is the early innings of a new bull market. Let's see if the Gold Miners Index is confirming this:

A screenshot of a video game Description automatically generated

(Source: TC2000.com)

As we can see from the above chart of the Gold Miners Index, the miners are sporting a massive breakout on their monthly chart, with the index clearing the $31.05 level ease on the April monthly close. This is an extremely bullish development as new highs typically occur for a reason. While brief pushes above old resistance areas are less important, surges above old highs that clear these levels on longer-term time frames are worth paying attention to for investors, and this is clearly a breakout that has some strength behind it. Thus far, we've seen continued follow-through to this breakout in May, and this is precisely how we would expect an index to act if a resistance level is truly in the rear-view mirror. Therefore, as long as the index can remain above $31.05, I see no reason to lose faith in the bigger picture for the miners. A 15% to 20% correction would be completely normal after a triple-digit rally like we've seen in two months. However, this would likely be a shake-out in a bull market, not a break like some weak handed investors might conclude before losing their positions.

In summary, the breakout in the Gold Bugs Index vs. the S&P-500 coupled with a multi-year breakout in the GDX suggests that a new bull market has finally begun in the gold miners, and investors would be wise to start nibbling on any significant dips. While some weakness into June would not be surprising, weakness early in a bull market is typically a buying opportunity. Therefore, rather than getting anxious, the key will be to watch how the index acts against the critical $31.05 breakout level. As long as this level is held, pullbacks can be considered as noise. While the S&P-500 has been the leader for several years and the only index it's made sense to park money in, the miners may finally be stealing the spotlight, and dips will likely present buying opportunities.

Disclaimer: Taylor Dart is not a Registered Investment Advisor or Financial Planner. This writing is for informational purposes only. It does not constitute an offer to sell, a solicitation to buy, or a recommendation regarding any securities transaction. The information contained in this writing should not be construed as financial or investment advice on any subject matter. Taylor Dart expressly disclaims all liability in respect to actions taken based on any or all of the information on this writing.

Want More Great Investing Ideas? 9 "BUY THE DIP" Growth Stocks for 2020 Beware 3,000 on S&P? 7 "Safe-Haven" Dividend Stocks for Turbulent Times
The VanEck Vectors Gold Miners ETF (GDX) was trading at $34.34 per share on Tuesday morning, down $1.32 (-3.70%). Year-to-date, GDX has gained 47.76%, versus a 13.32% rise in the benchmark S&P 500 index during the same period. GDX currently has an ETF Daily News SMART Grade of C (Neutral), and is ranked #13 of 34 ETFs in the Precious Metals ETFs category.

About the Author: Taylor Dart

taylor-dartTaylor has over a decade of investing experience, with a special focus on the precious metals sector. In addition to working with ETFDailyNews, he is a prominent writer on Seeking Alpha. Learn more about Taylor’s background, along with links to his most recent articles. More...
NYSE:GDX May 26, 2020 11:33am

Oil Prices: What the Narrowing of the Brent-WTI Spread Means

NYSE:USO May 26, 2020 11:07am

Natural Gas is Back in the ‘Buy Zone’

NYSE:UNG May 21, 2020 1:23pm

Trading Silver: Why I Prefer This Stock Over Silver ETFs

It's been a much better start to May for the silver bulls (SLV), as the metal has erased nearly all of its March losses and is finally beginning to act like the safe haven that investors hoped it might be in times of crisis. After Monday's advance, the metal is up 15% thus far this month and has massively outperformed gold (GLD), and regained its key monthly moving average. Despite all this, the small speculators continue to trim their bullish bets. This is an extremely positive sign, and quite a rare signal, and while this doesn't mean that silver has to go straight up from here, it does suggest that sharp pullbacks are likely going to find solid support. Based on the continued disinterest in silver among small speculators during this advance, I believe any 12% pullbacks to the $15.00 level will likely be buying opportunities.

A picture containing clock Description automatically generated

(Source: TC2000.com)

If we take a look at the above monthly chart of silver, we can see that we had a near breakout in Q3 of last year, but this rally was derailed as sentiment hit the highest level in several years at the peak of this advance. This spike in optimism became a major headwind for the metal, unfortunately, the same bulls that thought we might have a run of the mill pullback were battered in March after silver traded down to a new multi-year low. The good news is that this massive shakeout through the bottom of this 5-year range seems to have eroded most of smaller traders' interest in silver, which is evidenced by small speculator positioning remaining at 9-month lows despite this 35% advance. As noted in previous updates, this positioning is not at extreme levels like we saw in May, but we're getting close to those levels despite a silver price that is 15% higher. When higher prices make people less bullish and more cautious, this is generally a good sign. Let's take a look below at small speculator positioning:

A close up of a map Description automatically generated

(Source: CFTC.com, Author's Chart)

As we can see from the chart above of small speculator positioning (blue line), and silver price (yellow), the metal continues to charge higher off of the mid-March lows, but small speculator positioning continues to trend down, inching lower each week. The 1-month moving average for small speculator positioning finished last week at just 25,000 contracts, a new 9-month low, and bullish positioning is sitting at the same level it was when silver was trading at $15.00/oz. Therefore, unlike last summer, when higher prices resulted in small speculators plowing into the sector at full speed, we now have the exact opposite, small speculators showing complete disinterest despite the recent trend change we've seen. As long as this trend continues, I believe sharp pullbacks are going to provide buying opportunities as small speculators will likely begin to get a fear of missing out when they realize they're offside at the wrong time.

A picture containing clock Description automatically generated

(Source: TC2000.com)

The problem up until recently, unfortunately, is that silver was stuck beneath its key monthly moving average (teal line). This was a warning sign for me, as I don't like holding assets that are below this long-term trend barometer. The good news, however, is that silver's spike in the past week has pushed it back above this crucial level, and we are on track for a bullish reversal in this indicator if silver can finish the month above $17.00/oz. Therefore, we now have a combination of disinterest among small speculators and a recent trend change that's a positive development, and this made the metal much more attractive. This does not mean that silver is headed straight to $25.00/oz like the perma-bulls might suggest, but it does indicate that there's a very high likelihood of a higher low in silver near $15.00/oz if we do see pullbacks. For this reason, I believe investors should be watching closely to take advantage of weakness to buy the dip.

So, what's the best way to play silver?

While the potential shift to bullish on the monthly chart for silver is a great sign, I prefer SilverCrest Metals (SILV) to the silver price, as it's one of the highest-grade silver miners in the market currently. The company is sitting on over 120 million silver-equivalent ounces in Mexico and a $180 million cash position, making its mine fully funded for construction. Based on the company's average grades of over 1000 grams per tonne silver-equivalent, or an equivalent gold grade of nearly 1/3 of an ounce per tonne, I believe the company is a very likely takeover target. However, the best thing about the stock is that it's trading at all-time highs, so it does not have overhead resistance to weigh it down as silver does. Therefore, I would view pullbacks below $9.00 as buying opportunities.

A screenshot of a computer Description automatically generated

(Source: TC2000.com)

In summary, while I'm finally warming up to silver, my preferred way to play it currently is Silvercrest Metals Inc. (SILV). If the price of silver could pull back to the $15.00/oz level over the next few weeks, I would gladly start a metal position as well. You rarely get higher prices coupled with less excitement, but currently, we see this occurring in the silver market, which bodes well for silver prices as long as this persists. To embolden the bullish picture for silver, we are going to want to see a monthly closing above $17.50/oz for May.

Disclaimer: Taylor Dart is not a Registered Investment Advisor or Financial Planner. This writing is for informational purposes only. It does not constitute an offer to sell, a solicitation to buy, or a recommendation regarding any securities transaction. The information contained in this writing should not be construed as financial or investment advice on any subject matter. Taylor Dart expressly disclaims all liability in respect to actions taken based on any or all of the information on this writing.

Want More Great Investing Ideas? 9 "BUY THE DIP" Growth Stocks for 2020 7 "Safe-Haven" Dividend Stocks for Turbulent Times REVISED 2020 Stock Market Outlook- Discover why there is more downside ahead and the Top 10 picks for the bear market.
The iShares Silver Trust (SLV) was trading at $16.22 per share on Tuesday afternoon, up $0.43 (+2.72%). Year-to-date, SLV has gained 1.44%, versus a 11.03% rise in the benchmark S&P 500 index during the same period. SLV currently has an ETF Daily News SMART Grade of C (Neutral), and is ranked #14 of 34 ETFs in the Precious Metals ETFs category.

About the Author: Taylor Dart

taylor-dartTaylor has over a decade of investing experience, with a special focus on the precious metals sector. In addition to working with ETFDailyNews, he is a prominent writer on Seeking Alpha. Learn more about Taylor’s background, along with links to his most recent articles. More...
NYSE:SLV May 19, 2020 1:34pm

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