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Silver - All Quiet Before A Storm?


  • Silver sits at just under the $14.45 level.
  • Open interest takes a nose dive.
  • $13.86 is just above the line in the sand on the downside.
  • A recovery above $15 could set the stage for 2019.
  • USLV on a dip with a stop below $13.50 on March silver.
  • Looking for more? I update all of my investing ideas and strategies to members of Hecht Commodity Report. Get started today »

The silver market has been a real snoozer these days. Silver has a long history as a highly volatile commodity. When it starts to move higher or lower, it often attracts lots of speculators looking to hop onboard a trend that will offer a significant percentage change in the price.

Silver can also go to sleep for extended periods, frustrating longs and shorts with false breaks to the up and the downside. Recently, the silver futures market had been probing below the $14 per ounce level on the nearby COMEX futures contract. The decline to a low of $13.86 on the expired December contract in mid-November likely caused those looking for a break to the downside to short the market in hopes of a break below the December 2015 low at $13.635, which is the critical support level for the price of the precious metal. However, silver failed to experience follow-through selling, and the price bounced back over $14 per ounce and was trading at the middle of its trading range on Thursday, December 6. The December futures rolled to the new active month which is March as we are now in the final month of 2018. The silver market is sleeping as the holiday season is upon us, and the trend of lower highs and lower lows remains intact in the silver futures market.

With the trading ranges in the silver market so narrow these days, those who are devotees of the silver market are turning to leveraged products to magnify the small price bands these days. The VelocityShares 3X Long Silver ETN (USLV) and its bearish counterpart VelocityShares 3x Inverse Silver ETN (DSLV) are products that can make a dull market more interesting during periods of low price volatility.

Silver sits at just under the $14.45 level


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This article was written by

Andrew Hecht profile picture

Andrew Hecht is a 35-year Wall Street veteran covering commodities and precious metals.

He runs the investing group The Hecht Commodity Report, one of the most comprehensive commodities services available. It covers the market movements of 20 different commodities and provides bullish, bearish and neutral calls; directional trading recommendations, and actionable ideas for traders. Learn more.

Analyst’s Disclosure: I/we have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

The author always has positions in commodities markets in futures, options, ETF/ETN products, and commodity equities. These long and short positions tend to change on an intraday basis.

Seeking Alpha's Disclosure: Past performance is no guarantee of future results. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. Any views or opinions expressed above may not reflect those of Seeking Alpha as a whole. Seeking Alpha is not a licensed securities dealer, broker or US investment adviser or investment bank. Our analysts are third party authors that include both professional investors and individual investors who may not be licensed or certified by any institute or regulatory body.

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Comments (2)

Actually not so bad SIVR is not so volatile, got enough volatility elsewhere to keep me busy!
jimklawyer profile picture
I've been watching WPM which has been looking better recently.
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