Amid rising inflation fears, the Global X Silver Miners ETF (SIL) has gained about 19% the past month, prompting investors to wonder whether the precious metal is back with a vengeance.
The play on silver could be an inflation hedge. Even though the Federal Reserve has been relatively unclear on whether it will raise rates, the prevailing sentiment is that it will have to eventually. As investors look to add more gold to hedge against inflation, residual effects could spill over into silver.
Per the fund’s description, SIL seeks to provide investment results that correspond generally to the price and yield performance, before fees and expenses, of the Solactive Global Silver Miners Total Return Index. Despite the recent weakness in silver thanks to a stronger dollar and a flight from safe haven assets like precious metals, SIL is still up 55% over the last 12 months.
SIL gives investors:
- Targeted Exposure: SIL is a targeted play on silver mining.
- ETF Efficiency: In a single trade, SIL delivers efficient access to a basket of companies involved in the mining of silver.
When stretching out the performance of SIL to its one-year chart, the fund has gained over 30%.
Technical Specs on Silver
When momentum is strong in the capital markets, it can be difficult to stop. Bullish silver investors are hoping to catch a wave of momentum heading into the second half of the year.
“The silver bulls have the solid overall near-term technical advantage amid a two-month-old price uptrend in place on the daily bar chart,” wrote Jim Wyckoff in a Kitco News article. “Silver bulls’ next upside price objective is closing July futures prices above solid technical resistance at $30.00 an ounce.”
“The next downside price objective for the bears is closing prices below solid support at $27.00,” Wyckoff added. “First resistance is seen at the overnight high of $28.52 and then at the May high of $28.90. Next support is seen at $28.00 and then at last week’s low of $27.48.”
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