American Invest Hub
  • Politics
  • Investing
  • Business
  • Latest News

American Invest Hub

  • Politics
  • Investing
  • Business
  • Latest News
Investing

Silver and the SLV ETF could be on the cusp of a major bull run

by admin September 25, 2024
September 25, 2024
Silver and the SLV ETF could be on the cusp of a major bull run

Silver price continued its strong comeback, soaring to a high of $32.25, its highest point since May 29 this year. It has jumped by over 21% from its lowest point in August and by almost 475 from its lowest level this year. 

Similarly, the closely watched iShares Silver Trust (SLV) continued surging, reaching a high of $29.38, its highest level since May 28. 

Silver received a Fed boost

The first main reason silver and gold have soared is that the Federal Reserve decided to slash interest rates by 0.50% in the last meeting.

In the meeting, the Federal Open Market Committee (FOMC) noted that they were highly concerned about the labor market and confident that inflation was moving towards the 2% target.

This month’s data confirmed this as the unemployment rate remained above 4% while the headline Consumer Price Index (CPI) retreated to a two-year low of 2.5%.

There are also signs that American consumers are increasingly concerned about the labor market. In a report on Tuesday, the Conference Board noted that consumer confidence dropped at the fastest rate in over three years, with most people expressing concerns about the jobs market. 

Another report released by S&P Global showed that the manufacturing sector continued to contract this month. 

Therefore, analysts believe that the Fed will continue cutting rates in the last two meetings of the year. The base case among analysts is that it will now move to cutting rates by 0.25% instead of 0.50%.Silver and other metals do well when the Federal Reserve has embraced a dovish tone. 

Other global central banks have turned dovish. In Europe, the European Central Bank has slashed rates twice, while the Bank of England has signaled that it will resume cutting rates in the next meeting.

Silver prices rise in times of low interest rates for two key reasons. First, silver is often seen as gold’s small sibling, which explains the correlation between the two. Conversely, gold is usually seen as an alternative to the US dollar, which has continued falling.

Second, silver will benefit as some of the top sectors hurt by high interest rates start recovering. A good example of this is the clean energy sector, especially solar power, which has come under pressure in the past few years. Silver is widely used in the manufacture of solar panels.

Read more: Goldman Sachs Calls Gold The Best Investment Right Now

China stimulus concerns

Meanwhile, silver and other industrial metals jumped after China unveiled the latest stimulus to boost the ailing economy. 

The current stimulus came in the form of the reserve ratio, or funds that the bank must hold in their balance sheet. In a statement, the People’s Bank of China (PBoC) reduced the ratio, a move that could unlock over $125 billion from banks, which will use them to lend.

This stimulus led to a big increase in the commodity market. Iron ore, which was in a deep bear market, bounced back and approached the key resistance point at $100. Similarly, copper, crude oil, gold, and crude oil prices bounced back.

Still, some analysts are concerned that the stimulus came too late and that its impact will be limited. 

Some of the recent Chinese stimulus measures have yet to work out well. For example, the government unveiled a $70 billion stimulus a few months ago to help the troubled real estate sector. Months later, the industry is still languishing since the funds have taken long to arrive. 

Silver prices also jumped because of the closely watched gold/silver ratio. The ratio formed a double-top pattern at $89.90. In most periods, this pattern is one of the most bearish patterns. It has now moved below the double top’s neckline, pointing to more decline in the coming weeks.

The gold/silver ratio is widely used to value the two commodities. When it drops, it means that silver is more expensive relative to gold. 

Silver price analysis

The price of silver bottomed at $26.56 in August and has been in a strong bull run since then. Along the way, it flipped the important resistance point at $31.75, its highest swing on June 11.

Silver has also jumped above the ultimate resistance of the Murrey Math Lines. Additionally, it has moved above the 50-day Exponential Moving Average (EMA), meaning that bulls are in control for now.

Meanwhile, the Relative Strength Index (RSI) has continued rising, and is nearing the overbought point of 70. RSI is an indicator used to measure the rate of change of an asset. A higher figure is a sign that it has momentum.

The MACD indicator has also turned positive. Therefore, silver and the SLV ETF will likely continue the bullish momentum as traders target the final part of the Murrey Math Lines, which is known as the extreme overshoot at $32.8. In this case, SLV will jump to $32.

The post Silver and the SLV ETF could be on the cusp of a major bull run appeared first on Invezz

0
FacebookTwitterGoogle +Pinterest
previous post
Miniso stock outlook: is this Chinese retailer a bargain now?
next post
Will Dell’s reentry into S&P 500 after 11 years push its stock higher?

Related Posts

TSLY and NVDY ETFs brace for key events:...

October 8, 2024

Nu Holdings stock price surge 32% and hit...

November 10, 2024

Toncoin, Mask Network, and Pepe price predictions

May 29, 2025

USD/RUB forecast: here’s why the Russian ruble is...

March 29, 2025

eBay stock price could surge to $118 despite...

January 9, 2025

Could the Rolls-Royce share price suffer a harsh...

November 11, 2024

USD/IDR analysis ahead of Bank of Indonesia rate...

November 18, 2024

Peter Krauth: Silver Industry at Inflection Point as...

February 9, 2024

Victoria Gold Shares Drop After Landslide at Eagle...

June 28, 2024

Osisko Metals

May 7, 2024

    Stay updated with the latest news, exclusive offers, and special promotions. Sign up now and be the first to know! As a member, you'll receive curated content, insider tips, and invitations to exclusive events. Don't miss out on being part of something special.


    By opting in you agree to receive emails from us and our affiliates. Your information is secure and your privacy is protected.

    Latest News

    • Interview: Strategic location gives Brazil Potash cost advantage in domestic fertiliser market, says CEO Matt Simpson

      June 1, 2025
    • Canada’s Q1 GDP expands by 2.2%, driven by exports spike ahead of potential US tariffs

      June 1, 2025
    • President Trump to host farewell for Elon Musk as DOGE leader steps away

      June 1, 2025
    • UK’s digital banks face divergent fortunes: Starling stumbles, Monzo and Revolut soars

      June 1, 2025
    • Trump wants Apple to shift iPhone production from India to the US: here’s what it means

      May 18, 2025

    Categories

    • Business (3,022)
    • Investing (2,459)
    • Latest News (1,994)
    • Politics (1,530)
    • About us
    • Contact us
    • Privacy Policy
    • Terms & Conditions

    Disclaimer: americaninvesthub.com, its managers, its employees, and assigns (collectively “The Company”) do not make any guarantee or warranty about what is advertised above. Information provided by this website is for research purposes only and should not be considered as personalized financial advice. The Company is not affiliated with, nor does it receive compensation from, any specific security. The Company is not registered or licensed by any governing body in any jurisdiction to give investing advice or provide investment recommendation. Any investments recommended here should be taken into consideration only after consulting with your investment advisor and after reviewing the prospectus or financial statements of the company.

    Copyright © 2025 americaninvesthub.com | All Rights Reserved