In a market atmosphere where real-time alerts and algorithmic trading drive momentum, shares of the Sprott Physical Silver Trust (NYSE:PSLV) lit up trader dashboards on Tuesday with a sharp uptick in volume and investor activity. As commodities regained their role in the spotlight due to inflationary concerns and macroeconomic
Silver has been climbing strongly, albeit awkwardly, higher for years at this point. What’s particularly interesting to me is how the volume of the PSLV ETF has been pulsing higher as well.
I own a lot of physical gold and silver, and I had planned to amass a VERY large position in PSLV. This morning was the last straw. As thrilled as I am about Silver’s prospects, I am not TOUCHING this stuff again until after the election.
If Chinese demand continues, it could push gold and silver prices up together, making these metals a favorite for investors seeking safe havens amid economic uncertainty.
As long as the effects of inflation continue to show up in higher prices for goods and services, a higher nominal gold price can be expected over the long term – eventually.
My favorite indicator is the GDX/GLD ratio. This is a simple relative strength ratio that compares the price action in big-cap mining stocks to the price of gold. It’s important, because the price action in these stocks tends to lead gold prices.
It has been difficult to trade the market based on fundamentals since the pandemic struck. We appear to have several new black swans on the horizon to further muddy the application of fundamentals.
Nick Kwan/Pexels
A Perfect Storm For Gold And Silver
In theory, the past week should have been a perfect storm for gold and silver bulls, as the news fed investors a buffet of...
The University of Michigan Consumer Sentiment Index is at its lowest level since 2011. Retail sales dropped 1.1%, which includes inflation. So, in real terms, the drop was 1.5%, which is a huge drop in one month.
Oil has been the better reflation trade than precious metals, but now is a good time for investors in our previous top name Laredo Petroleum to add downside protection.
