Last week I talked about unrealistic expectations for the price of silver (see Silver Loses Its Mettle). My comments were centered on two specific factors: 1) silver’s primary role as an industrial commodity and 2) the fallacy of the gold-to-silver ratio.

Both of these items have their root in fundamentals, or lack of them.

In addition, I pointed out the fact that the price of silver has declined significantly in every single recession of the past fifty years.

Not surprisingly, the technical side appears to reinforce the lack of fundamental support for higher silver prices.

Below is a one year chart of silver prices (SLV – iShares Silver Trust ETF)…

As you can see, SLV has made consistently lower lows over the past seven months. Last month’s plunge of fourteen percent to a new seven-month low came after a similar percentage de cline in stocks that was supposed to take silver to new highs – not new lows.

The next chart is also of SLV. This one shows price action for the past four years…

As we pointed out last week, silver has still not exceeded its top from the summer of 2016.

With all of the arguments put forth in favor of higher silver prices, as well as the expectations for such, doesn’t silver’s price action seem just a bit disappointing?

Last chart for today is the ten-year chart for SLV…

If you were not disappointed before, you might be now. At the least, you might want to reconsider your bullish exuberance.

There is nothing fundamental or technical which supports the calls for much higher silver prices.

Does that mean that silver prices cannot go higher? Of course not. But silver’s price explosions are few and far between. And they don’t last long. This is probably not one of those times.

Someone said recently, “If you love gold then you absolutely have to love silver”. I disagree.

Kelsey Williams is the author of two books: INFLATION, WHAT IT IS, WHAT IT ISN’T, AND WHO’S RESPONSIBLE FOR IT and ALL HAIL THE FED!

By Kelsey Williams

http://www.kelseywilliamsgold.com

Kelsey Williams is a retired financial professional living in Southern Utah. His website, Kelsey’s Gold Facts, contains self-authored articles written for the purpose of educating others about Gold within an historical context.

© 2020 Copyright Kelsey Williams - All Rights Reserved Disclaimer: The above is a matter of opinion provided for general information purposes only and is not intended as investment advice. Information and analysis above are derived from sources and utilising methods believed to be reliable, but we cannot accept responsibility for any losses you may incur as a result of this analysis. Individuals should consult with their personal financial advisors.

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