Silver Slips as Economy Roars Forward

By Commodity HQ  MAR 12, 2013 4:30 PM

Silver is down 5% on the year, but with the iShares Silver Trust nearing initial support, it may make a jump higher.

 


Silver prices have long been known for their volatility, as the precious metal rarely has a quiet day. As such, investors typically keep a close eye on the commodity. Though silver started off the year with a bang, it has since retreated, and it is now down about 5% on the year. Meanwhile, the US economy has been surging, with the Dow Jones Industrial Average (INDEXDJX:.DJI) breaking record highs last week.

With silver sitting at lows and the economy sitting at highs, now may be a good time to hop back into the white metal. The iShares Silver Trust (NYSEARCA:SLV) is nearing initial support levels, which may also suggest that silver is due for a jump higher. But with stocks at all-time highs and investors increasing their risk appetite, it is difficult to say how silver will fare in the medium term.

A Short-Term Trade

For those looking to establish a short-term position, silver’s battered prices may present a strong opportunity. But with a position in the metal will come a fair amount of volatility; holding this metal is not for the faint of heart. A trade of this nature certainly falls under the Warren Buffett methodology of “being greedy when others are fearful,” as it seems that while markets cannot have a losing day it’s just the opposite for silver. Below, we outline several ways to make a short-term play on the white metal for those looking to get in on a possible rebound of the commodity.
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Editor's note: This article by Jared Cummans was originally published on Commodity HQ
No positions in stocks mentioned.