Silver Price: More Room for a Dip?

December 8, 2017

This week has been a big one in the markets. Not only are stocks up again this morning, but Bitcoin has made headlines with absurdly high price increases, hitting new milestone after new milestone—moving some 20% in just about 24 hours. With silver prices declining to about $16 per troy ounce and less, it seems like a good time to wonder if the precious metal might be on a dip—or whether it’s headed for new lows as “hedge”-interested money seems to move to Bitcoin. Let’s look at the silver market to find out if this is just the beginning of a new dip.

Kitco Sees More Room for a Decline

Before you get out your checkbook and prepare to buy on the dip, it’s important to consult Kitco News, which believes that there may be more to this dip than the temporary setback we’ve seen of late. With silver moving below $16—a key psychological milestone that could keep the prices low for some time—there may be reason to believe that silver is “stuck” here, at least for the short term future. The article quoted George Gero of RBC Wealth Management as saying it’s important to watch both copper and oil prices to see if there might be an impending movement in silver as well. As of late, copper and oil have also taken hits.

Pessimism for Silver—Should Investors Wait It Out?

The key point for some shouldn’t be whether silver is worthy of buying, but whether or not they should sell before the price dips too low again. This depends on individual investor strategy, however—if an investor holds long-term positions in silver without any expectation of selling, it’s possible that they would pay no thought to a dip like the current one.

Could Silver Head Below $15?

For silver investors worried about the prospects for the price of silver, however, there may not be any good news on the short term horizon. With George Gero’s warning to watch copper and oil prices for hints on silver, there’s a good chance that investors might have to wait a while before the next bit of optimism.

The next milestone to be crossed may not be the $16 or $17 mark, but the $15 mark as silver descends lower. If this is the case, it could give investors a reason to try and flock away from the white metal. But it also represents a strong possibility that silver is finding a new low, which in turn could provide a major buying opportunity for those who are content to live with silver on a longer horizon.

Reading the Silver Tea Leaves

What’s in store for the precious metal? No one can say, but it hasn’t been a particularly optimistic late 2017 for precious metals. Now investors have to wonder whether the recent dip is just a short-term blip, or truly a sign of things to come in the next several months. Whatever it is, the metal will bear watching—no matter where the prices may head.

Darren Capriotti

Darren Capriotti has been a market analyst for the past decade and is an expert in precious metals. He prides himself on his ability to analyze the market and offer true value to investors with questions about gold, silver, and other precious metals. Highly educated, incredibly passionate, and more accurate than most, Darren offers a true, unbiased look into what investors can expect in the precious metals market. You can reach Darren at dcapriotti@gold-eagle.com.

Most silver is produced as a byproduct of copper, gold, lead and zinc refining.