Gold and silver futures prices fell on Friday, prompted partly by a strengthening U.S. dollar index and dipping crude oil prices.
While gold fell 1.35% to roughly $1825 per ounce, silver was hit especially hard, dropping over $1 an ounce to breach $25, hitting a low of $24.61 an ounce. The move dragged silver ETFs lower as well, with the iShares Silver Trust (SLV) dropping 3.21% Friday.
In addition to the rallying dollar, President-Elect Joe Biden’s stimulus plan was revealed, driving stock markets globally lower on Friday, as it appears markets internalize higher personal and corporate taxes under the Biden administration.
Despite the drop Friday, analysts are still supportive of move higher in the industrial metal.
“Silver markets have gone back and forth during the course of the week, showing signs of choppiness and indecision. By doing so, this suggests that the market is simply focusing on whether or not there is enough stimulus out there, as later in the week there were concerns about whether or not Joe Biden could get a $1.9 trillion stimulus package through Congress. Silver will move back and forth based upon these expectations, but there is still a lot of support underneath and therefore I do not have any interest in shorting silver until we break down below the 50 week EMA, or essentially the $22 level. This means that we could continue to go lower in the short term, but I do think longer term we will continue to see buyers attracted to the precious metals markets,” wrote Christopher Lewis of fxempire.com.
Lewis noted that a move above technical resistance could drive silver back toward recent highs and beyond, stating, “the $26 level is resistance above, and I think that if we can break above there then it could open up a move towards the top of the candlestick from the previous week, reaching towards the $28 level. If we can break above there, then it is likely that the market could go towards the $30 level.”
For investors looking to allocate to silver, Aberdeen offers a large collection of metals ETFs, including those focused on silver. Aberdeen’s suite includes the Aberdeen Standard Gold ETF Trust (SGOL), which comes with a 0.17% expense ratio, and the Aberdeen Standard Physical Silver Shares ETF (SIVR), which has a 0.30% expense ratio. Additionally, the Aberdeen Standard Physical Precious Metals Basket Shares (NYSEArca: GLTR), which has a 0.60% expense ratio, offers a cornucopia of metals, including gold, silver, platinum, and palladium.
For more market trends, visit ETF Trends.