uploads///Front Month Silver Futures  Month Price Evolution

Silver Futures Show a Silver Lining


Nov. 20 2020, Updated 3:32 p.m. ET

The haven appeal

Gold prices edged to $1,157.9 per ounce on Monday, February 1, and closed 1.4% higher at $1,157.5 per ounce on Thursday, February 4. Silver also climbed by 0.79% and closed at $14.8 per ounce. These rises in gold and silver also buoyed gold and silver-based ETF investments like the iShares Gold Trust (IAU) and the iShares Silver Trust (SLV), which gained by 1.3% and 1.6%, respectively, over the same period. Notably, gold and silver both maintained a three-day winning streak on Tuesday, Wednesday, and Thursday.

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Silver prices have seen reasonable ups and downs since the beginning of 2016. But silver is unique because it’s taken as both a precious metal and an industrial metal. Recent global unrest and the equity market slump have thus weighed on silver while the haven appeal that lifted up gold has also helped silver. Silver futures traded on COMEX for March expiry have gained by 6.4% on a 30-day trailing basis, and silver remains the fourth best-performing commodity since the start of the year on the S&P GSCI (Goldman Sachs Commodity Index), which contains almost 24 commodities.

Mining-based investments

The rise in silver has helped silver cross its 100-day moving average price of $14.65. The RSI (relative strength index) indicator for silver, however, remains below 70 at 63.91. (RSI levels above 70 indicate possible reversion.)

As of February 4, the Global X Silver Miners ETF (SIL) and the leveraged Proshares Ultra Silver (AGQ) have also gained 5.7% and 12.4%, respectively, on a 30-day trailing basis. First Majestic Silver Corporation (AG), CoeurMining (CDE), and Pan American Silver Corporation (PAAS) have also gained 19%, 18.8%, and 19.8%, respectively, on a five-day trailing basis as of the same date. These three silver miners together contribute about 2.9% to the price changes in the VanEck Vectors Gold Miners ETF (GDX), which also rose by 16.5% on the same basis.

For related analysis, check out Market Realist’s Precious Metal Mining page.


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