Silver surfs ahead of gold, second-placed to copper for prominent metal YTD gains
As gold hits another all-time high, silver notches an 11-year-high
ASX silver stocks on the notable rise include SS1, BML and HRZ
Move over gold, copper… Bitcoin, too. Because let’s not forget the precious and highly industrially used metal, silver.
It’s very much having its moment, too. In fact, let’s get real here – it’s outperforming its loudmouth, look-at-me, precious metal big brother gold this year as it surges and trades at an 11-year high – and closes in on copper for YTD commodity gains.
Like gold, according to many an analyst, silver has solid momentum behind it, too.
The world’s second-most valuable metal now has a market cap of about US$1.83 trillion and has broken back above the psychological round number level of US$30 an ounce, changing hands at present for US$32.51/oz.
That feeling when you see #silver finally breakout and begin to show its true worth.
And you trusted your counts and instincts…#silversqueeze pic.twitter.com/Hn2c0UYxxS
— hypersonic78 (@hypersonic78) May 20, 2024
In fact, some believe it could make a move on its all-time high of US$50 before too long.
Here are the aforementioned commodities as they stand right now in YTD performance:
Copper: 33%
Silver: 32%
Gold: 17%
Oh, and for good measure, Bitcoin is up about 46%.
Earlier this year, Bitcoin turned heads when it flipped silver to become the eighth largest asset by market cap. But silver has now staged a strong comeback, rallying more than 33% since March 14 when BTC reached its all-time high of US$73,737. According to Cointelegraph, Bitcoin would now need to hit US$93k soon to inch back ahead of silver again.
Not actually out of the question, that, but that’s another story.
Why is silver rising?
Precious metal and strong industrial commodities are generally on the rise so far this week – well, as of Monday ASX 200 close. And a decent close it was (+0.7%).
As reported by Eddy “Closing Bell” Sunarto late yesterday, precious metals on the whole had a fantastic Friday last week, which bled into Monday. Silver hit and has remained at an 11-year-high at the time of writing.
“Copper’s strong performance is boosting silver, too, since it’s used in industrial stuff like solar panels,” noted Eddy.
Elsewhere, other analysts have suggested this silver rally may be just the tip of the iceberg.
Here’s one, citing the trading technicals dark arts…
“Silver does not look overheated, as it is only now entering overbought territory on the RSI on the daily timeframes,” said Alex Kuptsikevich, FxPro senior market analyst, in a note on Friday.
“Last month, silver was actively added for another three weeks after the RSI entered levels above 70. A two-week pullback in the second half of April later removed that overbought area. Technically, this clears the way up.”
Kuptsikevich noted, too, that silver’s long-term trend is on its side, suggesting that dips under its 200-week
“Long-term trends are also on the bulls’ side. In the last two years, they have been able to quickly turn the price to the upside after dips under the 200-week moving average. This year, the price is successfully pulling away from that line, but the most furious part of the rally may be ahead,” he said. “Silver could be ready to repeat the growth spurt it showed in 2010-2011.”
Otherwise, the main reason for a rise in gold and silver in particular right now, but also to some extent copper, can be partly attributed to “economic uncertainty boosting demand for safe-haven assets, supply-chain disruptions impacting availability, and increased industrial demand, particularly for green technologies.”
So says Adam Koos, the president at Libertas Wealth Management Group.
Why is silver outperforming gold?
The reason may in part simply come down to lower market cap = potentially higher returns for a similar precious metals safe-haven narrative.
Albeit, obviously it’s important to consider that traditionally silver has experienced higher volatility to gold, with more frequent price swings in the shorter term, which is one of the reasons gold bugs view the precious yellow one as the safer, ultimate inflation hedge and flight to safety.
Recently, though, Michele Schneider, director of Trading Education and Research at MarketGauge, was interviewed by the precious metals-focused US media outlet Kitco, and noted that silver’s “value play” makes it more attractive than gold and that it tends to outperform in a higher inflationary environment.
We certainly have that at present.
Added Schneider:
“This move in silver is telling us that we have fractures in the economy, but we don’t know how these fractures are going to manifest,” she said. “Is it going to lead to a debt crisis? Is the Fed going to have to lower rates? Either way, we should expect to see higher inflation.”
ASX silver stocks on the rise (24hrs)
Here are some of the best-performing silver-related stocks on the ASX over the past 24 hours – table per Market Index.
Notable ASX silver stocks on the rise (past week)
Undoubtedly the most head-turning silver stock on the local bourse over the past week is new market entrant Sun Silver, with a barnstorming beginning and leading a few other big gainers…
Sun Silver (ASX:SS1) +257%
Market newbie Sun Silver hit the ground sprinting on Wednesday last week, arriving on the ASX with a monstrous bang and climbing +125% at the close. The company owns the Maverick Springs silver project in Elko County, Nevada, which boasts an inferred mineral resource of 292Moz AgEq at 72.4g/t Ag.
This junior is focused on the advancement of the Sorby Hills Joint Venture base metals project (75%) in Western Australia and its Manbarrum project in the Northern Territory. Reserves: 53Moz silver (17.5Moz Measured, 12.1Moz Indicated, and 23.4Moz Inferred).
Like the following silver stocks, BML doesn’t have fresh news over the past week, but is strongly trading off the commodity price surge…
Horizon Minerals (ASX:HRZ): 35%
Investigator Resources (ASX:IVR) : +16%
29Metals (ASX:29M) +16%
Alicanto Minerals (ASX:AQI) +15%
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