So far this year the silver market has looked pretty good, all things considered. When the stock market is at its highs you don't usually see the metals markets show any strength.
Since December, silver and gold each made a very nice higher and broke out of a recent consolidation. Silver is a very unique market because it is a precious metal as well as an industrial metal. That is the allure to investing in silver over gold.
Gold is only a precious metal and usually struggles when the stock market is in a bull phase. Since the economy is rebounding and looking pretty good right now, silver demand is increasing across all industries. In the US, the use of silver as a precious metal is only 6 percent of its total use. Electrical and electronics are the largest uses for silver in the US. Globally silver is gaining demand because of the huge transition to solar power as well as increasing cell phone demand. I could go on and on about the uses and how they are increasing but the bottom line it demand is increasing much more than for Gold. Silver is very cheap compared to gold and that is why so many industries are finding unique ways to use the metal. When global demand increases that can only mean that the price of silver should increase as well.
The technical picture of this market is very interesting. On December first the silver had a huge range day closing very strongly. Since December first silver had made a higher high and a higer low which is indicative of an uptrend. After the second higher high silver has retraced back to the consolidation from the beginning of this year. If the silver market can hold above the previous lows of 14.70 this market should remain in an uptrend with increasing demand.
As the market gains strength more institutional buyers will show up which will add some fire to this market. Look for buying opportunities near the December consolidation and risk the trade to below the 14.70 low.