Breaking News
0
Ad-Free Version. Upgrade your Investing.com experience. Save up to 40% More details

Is it Time to Buy Silver?

Stock MarketsAug 24, 2021 02:30PM ET
Saved. See Saved Items.
This article has already been saved in your Saved Items
 
© Reuters. Is it Time to Buy Silver?

Silver has performed poorly so far in 2021 with an 11% loss YTD. This is despite many positive catalysts including rising inflation and dovish monetary policy. Taylor Dart explains whether it's time to buy the dip.It’s been a rough year thus far for investors in the precious metals space and especially disappointing for those believing that inflation would unlock the key to higher prices for gold (GLD (NYSE:GLD)) and silver (SLV). Despite multi-year high inflation readings and negative real rates diving deep into negative territory, gold and silver are down year-to-date and have tested their year-to-date lows in Q3. The only good news is that this recent correction has put a massive dent in bullish sentiment and looks like it may have been the capitulation the metals needed to finally shake out the last of the weak hands. This is evidenced by three consecutive low double-digit readings for bullish sentiment last week and a medium-term bullish sentiment reading that’s dipped to new 2-year lows. Let’s take a closer look below:

(Source: Daily Sentiment Index Data, Author’s Chart)

As shown in the chart above, the medium-term moving average for silver sentiment has slid to its lowest levels since early 2019, currently sitting at a reading of barely 25%. This is a massive sea change from six months ago when market participants were trying to incite a squeeze in silver, and the medium-term moving average soared above 75% bulls, with three bulls for every one bear in the market. With this reading now reversed (three bears for every one bull), sentiment has finally become a tailwind, with further weakness likely to present a buying opportunity. This is because when bearish sentiment dominates a market, there’s few left to sell or short. Based on history, sentiment can always get worse, but for the first time in two years, sentiment for silver has flipped to a contrarian bullish reading.

Continue reading on StockNews

Is it Time to Buy Silver?
 

Related Articles

Add a Comment

Comment Guidelines

We encourage you to use comments to engage with other users, share your perspective and ask questions of authors and each other. However, in order to maintain the high level of discourse we’ve all come to value and expect, please keep the following criteria in mind:  

  •            Enrich the conversation, don’t trash it.

  •           Stay focused and on track. Only post material that’s relevant to the topic being discussed. 

  •           Be respectful. Even negative opinions can be framed positively and diplomatically. Avoid profanity, slander or personal attacks directed at an author or another user. Racism, sexism and other forms of discrimination will not be tolerated.

  • Use standard writing style. Include punctuation and upper and lower cases. Comments that are written in all caps and contain excessive use of symbols will be removed.
  • NOTE: Spam and/or promotional messages and comments containing links will be removed. Phone numbers, email addresses, links to personal or business websites, Skype/Telegram/WhatsApp etc. addresses (including links to groups) will also be removed; self-promotional material or business-related solicitations or PR (ie, contact me for signals/advice etc.), and/or any other comment that contains personal contact specifcs or advertising will be removed as well. In addition, any of the above-mentioned violations may result in suspension of your account.
  • Doxxing. We do not allow any sharing of private or personal contact or other information about any individual or organization. This will result in immediate suspension of the commentor and his or her account.
  • Don’t monopolize the conversation. We appreciate passion and conviction, but we also strongly believe in giving everyone a chance to air their point of view. Therefore, in addition to civil interaction, we expect commenters to offer their opinions succinctly and thoughtfully, but not so repeatedly that others are annoyed or offended. If we receive complaints about individuals who take over a thread or forum, we reserve the right to ban them from the site, without recourse.
  • Only English comments will be allowed.

Perpetrators of spam or abuse will be deleted from the site and prohibited from future registration at Investing.com’s discretion.

Write your thoughts here
 
Are you sure you want to delete this chart?
 
Post
Post also to:
 
Replace the attached chart with a new chart ?
1000
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Thanks for your comment. Please note that all comments are pending until approved by our moderators. It may therefore take some time before it appears on our website.
 
Are you sure you want to delete this chart?
 
Post
 
Replace the attached chart with a new chart ?
1000
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Add Chart to Comment
Confirm Block

Are you sure you want to block %USER_NAME%?

By doing so, you and %USER_NAME% will not be able to see any of each other's Investing.com's posts.

%USER_NAME% was successfully added to your Block List

Since you’ve just unblocked this person, you must wait 48 hours before renewing the block.

Report this comment

I feel that this comment is:

Comment flagged

Thank You!

Your report has been sent to our moderators for review
Disclaimer: Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. All CFDs (stocks, indexes, futures) and Forex prices are not provided by exchanges but rather by market makers, and so prices may not be accurate and may differ from the actual market price, meaning prices are indicative and not appropriate for trading purposes. Therefore Fusion Media doesn`t bear any responsibility for any trading losses you might incur as a result of using this data.

Fusion Media or anyone involved with Fusion Media will not accept any liability for loss or damage as a result of reliance on the information including data, quotes, charts and buy/sell signals contained within this website. Please be fully informed regarding the risks and costs associated with trading the financial markets, it is one of the riskiest investment forms possible.
Continue with Google
or
Sign up with Email