Silver prices in 2017 have been a mixed bag lately.
If the silver price action two weeks ago was discouraging, the past week was the polar opposite.
In fact, anyone who held silver last week was rewarded with a solid 2.9% return.
The price of silver struggled in the first half of the week, trending sideways to downwards as the market awaited confirmation of a Fed rate hike.
This caused silver market participants to follow the old adage, but in reverse. It was a case of “sell the rumor, buy the news.”
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And those traders and investors were buying in full force. Silver prices rallied from a low of $16.77 before the rate hike to $17.48 the next morning. That’s a blistering 4.2% gain in under 24 hours.
Though silver traded intraday through its 50-day moving average of $17.43, it has yet to close above it. But based on its bullish action, I don’t think it will take long.
That’s why I’m going to share with you my near-term silver price forecast, which shows how high the metal will reach by the end of this quarter.
First, here’s a recap of silver’s strong gains last week…
Silver Prices in 2017 Rebound from the Fed Rate Hike
On Monday, March 13, silver gave a strong showing early in the day on the back of a weak U.S. dollar. The silver price ran above the $17 level but eventually fell back to $16.95 by the close. Still, the metal marked a slight gain of 0.2% from the previous close of $16.92 on Friday, March 10.
Tuesday proved to be much weaker as the dollar surged in afternoon trading. The price of silver dropped 0.5% on the day to settle at $16.84.
Silver market participants followed the old adage, but in reverse. It was a case of “sell the rumor, buy the news.”
But the FOMC announcement of an interest rate hike on Wednesday sent silver prices soaring. Silver traders remained reluctant as the U.S. Dollar Index (DXY) remained high near 101.7. But right around announcement time, the dollar tanked and silver surged 2.9% to $17.32 by the close.
Here’s how the dollar moved over the past week…
That huge loss in the dollar coincided with silver’s stunning gains, as shown in this chart below…
On Thursday, as the market further digested the Fed’s confirmed hike, silver pulled back a little. It eventually settled at $17.29 for a loss of 0.2%.
Friday’s open brought a bump in silver as the dollar remained weak. It opened higher at $17.35 and moved even higher to close the week at $17.41. With that, silver prices gained 0.5% on the day and 2.9% on the week.
But last week’s gains are just the start of a big near-term surge. I’ve found two momentum indicators that show silver has more room to run over the next three months.
Here’s my silver price prediction for the end of the second quarter (Q2)…
Silver Prices Could Hit This Target by June 30, 2017
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Peter Krauth is the Resource Specialist for Money Map Press and has contributed some of the most popular and highly regarded investing articles on Money Morning. Peter is headquartered in resource-rich Canada, but he travels around the world to dig up the very best profit opportunity, whether it’s in gold, silver, oil, coal, or even potash.
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