Now, whether we consider the shiny yellow rock a viable investment is another story.
You know I’m bullish…
Yet I can’t overlook silver’s lack of participation.
I think of silver as gold’s rambunctious cousin — lots of fun until someone gets hurt — and someone always gets hurt!
Perhaps trading silver isn’t your cup of tea. I don’t blame you.
But silver rallies possess an infectious exuberance. Its rowdy antics and monstrous daily ranges magnetize investors as they attempt to skirt silver’s flame without burning to a crisp.
Unfortunately, silver isn’t bringing the heat. It has yet to break out, and the silver-to-gold ratio is trending lower.
A similar scenario unfolded last spring when gold ran up against its former all-time highs:
Friends and family are blowing up my phone (and this time, it’s not just about baby pics). They’ve noticed gold’s rally to new highs – and they want to know whether to buy physical gold or an ETF — bars or coins.
But silver has yet to enter the conversation…
I get it. New all-time highs have a way of capturing the investor’s collective conscience.
But while gold is printing new all-time highs, silver futures post a mere multi-month high.
I’m no fan of the catch-up trade, as I always want to own the strongest name(s), but check out silver’s four-decade base:
If silver doesn’t come to play, precious metals won’t win the day.
Gold’s resilience has been impressive lately, especially as its two main headwinds – the US dollar and real yields – catch higher.
But while all eyes are following gold as it coils just below all-time highs, I’m tracking silver. Because gold’s doggedness is all for naught if silver breaks down.
Check out the iShares Silver Trust ETF $SLV retesting a critical former support level at approximately 20.50:
Precious metal charts aren’t painting a bullish picture for investors.
Silver is underperforming gold. The Gold Miners ETF $GDX is posting new all-time lows versus the broader market. And everywhere you look, individual gold mining stocks are breaking down.
Well, not all mining stocks. One chart continues to fly high…