RJO FuturesCast

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Metals

Where Does Silver Go From Here?

Posted 01/11/2019 8:22AM CT | Tom Beller

After a nice rally over the course of December due to a stock market sell-off, a scaling back from the Fed with its monetary policy, and a breaking dollar, the silver market has some resistance in the $15.75 per ounce area.  However, with the stock market as unstable as it is, many in the industry are calling for a big push higher regarding the precious metals and are bullish on silver in 2019. I think the support for silver is about $15.20 and about as far of a pullback we will have from here. I agree with the bullish consensus, and if you look at the gold/silver ratio which I have been writing about, I feel investors will look at silver as an attractive and cheaper metal to invest in.

I believe the recent run up with the equities has paused the rally in gold and silver, but I think the equity market is going to pause too as we wait for more information. I have resistance levels around yesterday’s close for equity markets. Overall, I believe silver has the potential to go much higher in 2019, reaching above $17 and possibly hitting $18. With rising inflation and a gold/silver ratio as high as it is, I feel 2019 will be a great year for the metals and we have many strategies in place to take advantage of the situation for the upcoming year.  We may be a little overbought now due to the recent run up, but I would be buying dips in the market. We can really take off if we get through and break the trend line on the weekly chart below.

Silver Weekly Chart

Silver Weekly Chart

Tom Beller