Why the "Smart Money" Is Bullish on the Price of Silver Ahead of 2019
Peter KrauthAfter a rough week for stocks and the Thanksgiving holiday, the price of silver remains one of the best deals around.
Of course, additional discounts may still lie ahead, but silver's inherent value at current prices is difficult to beat – no Cyber Monday promos required.
Silver prices had a good week last week, but they backpedaled on Black Friday (as did stocks) while the U.S. dollar found renewed vigor.
And the gold to silver ratio has once again popped higher in gold's favor, making silver an even bigger relative bargain.
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The year is starting to draw to a close, but several market researchers continue to see massive potential for silver as we approach and enter the New Year.
Before looking at projections for 2019, here's what is behind the recent movement in the silver price…
How the Price of Silver Is Trending Now
During a week that's traditionally good for stocks, the trend was bucked this year as the S&P 500 lost a painful 100 points.
It was obvious that agile money moved into the dollar. The DXY started around 96.2 and ended the week near 97. As the week progressed, bonds were also favored as the 10-year Treasury yield dropped from 3.08% on Monday to 3.05% by Friday's close.
Silver started on Tuesday (Nov. 20) by giving up recent gains mostly between 8 a.m. and 9 a.m. Just after 8 a.m., silver had reached $14.46 as the DXY surged to 96.8, then silver dropped as equity investors decided it would be a risk-off day. Just before 11 a.m., silver tested $14.20 and then regained $14.30 but closed at $14.29.
Here's the DXY's moves of the last five trading days:
The dollar would lose a little ground through Wednesday and Thursday, dropping back to 96.5.
But with Friday's renewed market sell-off, the dollar rallied again, pulling the DXY back up to 97 late in the day. That pushed silver back from $14.48 down to close the holiday week at $14.26.
Then on Cyber Monday, the dollar dipped early but regained strength as other major currencies sold off. The DXY was back at 97.5 by midafternoon. Silver gave back early gains from $14.40 to consolidate near $14.22 by 3 p.m.