December silver is trading $14.580, down 27 cents on the day. Per the weekly chart below, silver is sitting in a tight one-dollar consolidation for the past four months. A “Safe heaven” type of strategy hasn’t worked out for silver so far with the U.S. “government shutdown” talk back in the news. The dollar is relatively strong this morning adding another pressure to silver and metals in general. So far, silver is weak just like any other commodity, but if the battle over government funding heats up, more upside likely.

For now, sitting in consolidation waiting for direction. Sideways trading strategy using options might be an ideal way to approach this market. The Gold/Silver ratio is sitting at 84.82 from a recent high of 86.16 suggesting that “bid” for silver is improving relative to Gold.  As the old saying, “trade what you see not what you think.” The lack of any “flight to quality” type of market condition. leaves the bears with a bit of an advantage.

Silver Mar ’19 Weekly Chart

Silver Mar '19 Weekly Chart

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Eli Tesfaye

Senior Market Strategist
Eli started his career in the futures and options market while he was in graduate school finishing up his MBA in 2003. Eli specializes in Automatic trading strategies and systematic options trading strategies in futures market. He has been Series 3 license holder since 2005. Eli's is an avid reader, runner, and yoga practitioner.
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