maandag 10 juli 2017

"Silver's Plunge Is Nearing Completion"

Precious metals fans have had to content with a triple whammy this year: not only is the dollar weaker, not only have cryptocurrencies - seen by some as a natural alternative to safe PMs, especially among the younger generation - soared since the start of the year, blowing out all other asset classes including precious metals, but gold and silver have largely gone nowhere despite a year of political volatility and central bank confusion...


There is a ray of hope however: according to Bloomberg's macro commentator Marc Cudmore, silver's "justified" plunge, as gold and silver have a strong correlation with real rates, is finally nearing completion, as "we are approaching the point where both higher yields and lower yields have the potential to boost the asset class." The technicals are also turning: "In euro terms, silver is looking stretched to the downside based on its relative strength index, a momentum measure. It should also be supported by its 31-month upward trendline, which it’s testing now."
Finally, "Monday is the first day of silver and gold futures trading on the LME. That might provide a fresh source of excitement and buying interest." While there are "clear dangers involved when trying to catch a falling silver knife" Cudmore notes that "a risk-reward analysis makes an attempt appealing"....

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