According to analysts, silver tends to catch up with gold in terms of price at the moment. However, these attempts are not always successful. Both metals are actively growing, but each at its own pace, experts say.
In the past two weeks, the value of white metal has shown steady growth relative to yellow. Since the middle of this month, the ratio of gold and silver has decreased from 93 to 86.09. In 2019, the maximum value of this parameter reached 90, which is a record for the last 25 years. According to experts, this fact indicates a significant undervaluation of silver compared to gold. Previously, the ratio of the two precious metals also reached maximum values, but it was short-lived. Now, this trend holds for a long time.
Experts draw attention to the fact that the decline in the price ratio of gold and silver does not mean an increase in the cost of white metal. This may be a sign of falling prices for the yellow metal, analysts remind. In general, the growth of this indicator indicates that "silver" prices are falling relative to gold. Silver investors can use this option to make decisions about buying additional positions in white metal.
The recent rise in silver prices is caused by an increase in interest in silver ETF funds, whose shares are backed by this precious metal, as well as the rise in the silver futures market. Recall that one futures contract involves the delivery of 5,000 ounces of silver. The main participants in the futures market are the largest players who significantly influence the price dynamics of precious metals.
According to expert estimates, the prospects for silver have improved significantly since the middle of July 2019. The white metal showed a breakthrough from the six-year lateral movement, and the average price over the past 200 days has increased rapidly, which may indicate a change in trend.
The cost of silver is in a very strong resistance zone, experts emphasized. They warn that overcoming this level can be overwhelming for the precious metal. They believe that silver is now in a very tense and crucial phase, which will give direction to the further dynamics of white metal prices.
