Gold gives back a portion of yesterday’s gains
‘Almost impossible to short silver in this scenario,’ says analyst
(USAGOLD – 5/4/2021) – Gold gave back a portion of yesterday’s gains in early trading mostly in response to a stronger dollar. It is down $8 at $1786.50. Silver is down 14¢ at $26.84. Precious metals charged out of the gate yesterday to begin the month. Gold posted a respectable 1.3% gain, but silver outperformed it – up 3.7% on the day.
Technical analyst Christopher Lewis offered some timely insights on silver in an article posted at the FXEmpire website yesterday morning. “Silver is going to be a little bit different than gold though because it is also very sensitive to the overall industrial recovery, as it is an industrial metal. Because of this, I think that you need to be very cognizant of the recent narrative, which of course is that we are going to continue to explode to the upside as far as the reopening trade is concerned. In other words, it is almost impossible to short silver in this scenario……” Lewis sees $28 as the near-term target for the white metal. At the same time, he cautions silver investors to be patient, alluding to its history of “massive corrections.” He says he “likes the idea of buying on pullbacks.”
Chart of the Day
Percent increase or decrease over the prior year
Chart note: In 2020, silver recorded its best percentage gain in a decade – 46.3% – and posted its third-largest gain over the 20 year period. It has posted gains – sometimes significant – in twelve of the last twenty years. So far in 2021, silver is down about 1%, as of yesterday’s close.