Compared to the gold price, the silver price moves much quicker. Gold price increased from 2018 August to 2020 August, with minor corrections. Silver price, on the other hand, moves differently. A lot of the time silver price is relatively steady and moves sideways.
In March 2020, the silver price started to move upwards – the price was 11.8 US dollars. In August 2020 silver price had reached almost 30 US dollars – this is a ca 150% price increase in 5 months. The silver price has been fluctuating between 21,5 – 30 US dollars from that point.
*Red lines are downtrend. The heavy red line is the long-term trendline.
*Green lines are uptrend. The heavy green line is a long-term trendline.
*Blue lines are short term support & resistance lines
(Picture 1. XAGUSD Trendlines / Support & Resistance)
(Picture 2. XAGUSD Fibanocci retracements)
According to the Silver Institute, physical supply in 2021 increased over a depressed 2020 by 8% to 1,056 million ounces but remained below the output for 2014-2016. Meanwhile, demand is up 15% this year at 1,033m oz, leaving a marginal surplus of just 23m oz. The question arises concerning demand patterns over the next few years when accelerating investment in non-fossil fuel energy and electricity. For silver, increasing demand for electric vehicles and upgrading of mobile networks to 5G can be added to photovoltaic demand. Forecasting the balance of supply and demand is always difficult for silver because of substantial and unforeseen changes in usage (remember photography?). Still, it seems reasonable to assume that silver will be one of an elite group of beneficiaries from global environmental policies. Read more @SeekingAlpha
Disclaimer: This article is for informational purposes only and is not intended as an investment analysis or recommendation to sell or buy commodities. Tavex is not responsible for any decisions made based on this information. Investing is associated with opportunities and risks, and the market value of commodities can both increase and decrease. Past or future yields on the commodities and financial ratios shown above do not represent a promise or an indication of future earnings.