Silver Was Our Best Bet

March 9, 2010 | By | Reply More

Our editorial team was unanimous in expecting the precious metal markets to start this week in a seriously upbeat mood. Silver was our bet for outperforming gold, platinum and other PGMs after the expected profit taking at the end of last week turned out not to be as severe as we thought.

We felt that both the technical and fundamental criteria were in place for the next leg up particularly as the precious metals have shown good underlying strength for the last several weeks.

Monday’s trading and today’s mid morning European trading has undermined our confidence as spot silver plunged briefly below $17 an ounce before leveling off at $17.05 while gold is toying with $1117.50 as we write.

Amongst PGMs both platinum and palladium are hanging on to slight losses so far.
This scenario leaves us at somewhat of a loss as so many factors affecting precious metals have to be taken into account and the flavor of the week seems to constantly change.

Last week, the prime mover was currencies as we had gold hitting all time highs against both the Euro and the GB pound. Meanwhile the dollar price of gold fell from circa $1145 an ounce while its value against a basket of currencies ended up relatively static.

Will currency movements continue to be the overriding mover of precious metals or will the fear of inflation take over? It may be that coming to the fore will be some added impetus to the fear of a China bubble imploding that some pundits have promulgated.

As we said earlier there are many situations that can take over the lead in affecting the prices of precious metals at this time of global uncertainty and diminishing faith in governments abilities to get their citizens out of the mess that they have allowed to develop.

Meaning that whatever happens to gold, silver and PGM prices in the short term we remain confident that the most reliable investment that the investing public can make to preserve the value of their capital is gold or silver, preferably via an easily tradable ETF holding bullion or a direct purchase at Bullion Vaults

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