By Dr. Renisha Chainani, Head- Research, Augmont – Gold for all

Silver is making a move, greatly outperforming gold as it trades at an 11-year high to approach $31.85, following a comparatively modest start in the first quarter. This week, silver has gained almost 10%, which is its greatest result since early April. The gold-silver ratio is currently trading at its lowest point since August as a result of skyrocketing silver prices, which have driven it below 80 points.

International Silver Chart

Growing geopolitical uncertainty and increased pressure on domestic manufacturing in the United States will depress prices and weaken the currency. The surge in silver coincides with copper prices reaching record highs above $5 per pound. Given that silver prices have been range-bound for the past 3.5 years, there is a lot of pent-up sentiment in the markets. Silver’s eventual outperformance is hardly surprising, given its advantages as an industrial and monetary metal.

Silver is following in the footsteps of gold and copper. Gold is a tool for hedging, whereas silver is merely a commodity, similar to copper. All metals, including silver, are rising in value right now for the same reason: cautious optimism about the expansion of the world economy. Charts of commodities show that their prices follow a cyclical pattern: they are cheap during economic downturns and increase in value during recovery.

Bullishness is in full swing—you have geopolitical concerns in addition to the epidemic. And following that, what action does our government take? Since this is your campaign year, all those gold-related issues just serve to increase back-end uncertainty, which is why you keep running here. The United States of America has printed an excessive amount of money, and the outcome is evident. Where is all of the money going? Large sums of money are invested in metals as a hedge against inflation in addition to purchasing stock drops. Not only are we doing this, but economies throughout the world are as well. Their holdings are growing, and no one is sure where to go.

This week, the gold market saw one of the most dramatic changes for precious metals markets this year as a result of a plethora of important economic data and in-depth remarks from the Fed. The plenty of Fed speakers next week will pose the largest danger to markets. On Monday and Tuesday, there will be speeches from six US central bankers. The minutes from the Federal Reserve’s May 1 monetary policy meeting will be the week’s high point.

Gold and Silver prices are expected to continue their bull run going forward with the next target of $34 (~ Rs 97500) and $35 (~ Rs 100,000) for Silver. For Gold, the next target resistance is $2450 (~Rs 74500) and $2500 (~Rs 76000).

 

 

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