Silver offers a bargain

Silver vs gold

The precious metals silver and gold continue to have a strong fundamental bias. Low interest rates, extra stimulus expected, and risk positive markets on vaccine hopes are all keeping gold and silver supported.  

Silver has more obvious upside than gold

If you look at silver you can see that the current price is less than half of what the record high has been (at around $50). This means that silver has plenty of more room to go higher. Goldman Sachs see’s a ‘near perfect environment for silver’ and Citi is ‘very positive’ noting the steady investment demand. 

Silver benefits from both safe haven bids and its demand as an industrial metal being used for mobile phones and solar panels. Furthermore, Bloomberg notes that inflows in silver backed ETF’s are now running at well over 1000 tons a month 

Where will buyers re-enter?

Firstly, look at the 4 hour chart and the breakout of the ascending weekly trend line. Any return to $19.20 should find buyers. 

Secondly look for a Monthly close above the trend line marked. Some longer term buyers will enter at market or a slight pullback to $19.20 if we get a close above $19.20 at the end of the month. Definitely one area to watch. I took profit at 20.30 yesterday on my longs from the same trend line break and I am looking at potential re-entry levels.