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W.With precious metals falling on Friday, some experts suspect that silver in particular could continue to rise in the future.
Silver and gold are both trading lower today, with gold futures falling 2.4% in the front month and trading at $ 1765.10 an ounce or $ 43.60 lower while silver is down 3.68% or nearly $ 1 USD has plummeted and is trading near $ 24.36 an ounce.
“Gold was sold as US bond yields rose,” said HDFC Securities, senior analyst (commodities) Tapan Patel.
The downward movement continued silver ETFs like that. negative pressure iShares Silver Trust (SLV), which fell over 3% on Friday, along with silver futures.
Despite the fall in commodities and precious metals on Friday, some experts see silver rising long-term as President Biden’s electric vehicle revolution could eventually result in the US needing more commodities and industrial metals for vehicles.
Copper, palladium, platinum, lithium, nickel and rare earth metals used for batteries and renewable energy technologies. Silver is also one of the most popular industrial metals.
“Silver will benefit from electrification because of its use in solar panels, electric vehicles (electric vehicles) and charging stations,” Suki Cooper, an analyst at Standard Chartered, told Reuters.
Gold’s cheaper companion is a critical component in Biden’s aggressive $ 1 trillion plan. The industrial metal will be used for electric vehicles, the batteries, fuel cells and plug-in charging stations that power them, as well as the cables that connect new wind turbines and solar parks to the grid.
Europe and China are pushing for electric vehicles with regulations, consumer incentives, and subsidies for automakers and battery manufacturers. President Biden’s pledge to follow up on such a plan means the world’s three largest auto markets are moving away from internal combustion engines faster than anyone could have predicted a few years ago.
“This is the final big piece of the puzzle,” said Peter Wells, director of the Center for Automotive Industry Research at Cardiff Business School in Wales. “This is putting pressure on some of the more backward companies.”
While silver futures have fallen from the $ 30 level seen earlier this year, Goldman Sachs expects the price of silver to climb to $ 33 an ounce in 2021, driven by both investment and industrial demand after which precious metal is supported.
“We believe silver is prone to a sell-off in August and September,” Jeff Christian, managing partner of New York-based resource consultancy CPM Group, told Barron’s. “If you see a price of $ 24 an ounce, buy it because the chances are we’ll see $ 28 soon.
Meanwhile, the gold / silver ratio, an important measure for investors and precious metals analysts, showed robust upward momentum despite the optimism of some silver bugs, reaching 72.50. According to some analysts, the next resistance level is at 73 and if the gold / silver ratio manages to beat that target it will be heading for the recent highs at 73.35 which could be bearish for silver.
Technical analysts are preparing for both options.
“Silver has managed to get below the support at $ 24.50 and is trying to settle below the next support level at $ 24.20. If successful, silver will head for support at $ 24.00. Movement below $ 24.00 will pave the way to test the $ 23.80 support. If silver falls below this level, it will head for the $ 23.50 support. On the flip side, the previous support at $ 24.50 will serve as the first resistance for silver, heading towards the resistance at $ 24.70. A successful test of this level will propel silver towards the next resistance level at $ 25.00, “wrote Vladimir Zernov of FXempire.com.
Investors interested in exposure to precious metals can consider easy-to-use ETFs. For example the SPDR gold stocks (NYSEArca: GLD), iShares Gold Trust (IAU), Aberdeen Standard Gold ETF Trust (SGOL), and Sprott Physical Gold Trust (PHYS) offer exposure to gold price movements.
Besides, the Aberdeen Standard Physical Silver Shares ETF (SIVR), iShares Silver Trust (SLV), and Sprott Physical Silver Trust (PSLV) can help keep track of the silver market.
You can find more information about the precious metals market in our precious metals category.
Read more at ETFtrends.com.
The views and opinions expressed herein are those of the author and do not necessarily reflect those of Nasdaq, Inc.
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