What is Silver?
Silver is a heavy metal of high luster and is an especially good conductor of heat and electricity. Silver is a heavy, rather soft, white metal, very ductile and malleable and capable of taking a high polish. It surpasses all other metals as a conductor of heat and electricity, but is too costly to find extensive use for such purposes. It melts at a little lower temperature than Copper (961°). It alloys readily with other heavy metals, and when it is to be used for coinage a small amount of copper, from 8 to 10%, is nearly always melted with it to give it hardness.
Discovery and History of the Silver Element
Silver was discovered in Ancient times and used by the ancient South Americans, Asians, Egyptians, Greeks, Romans and Chinese. Silver is one of the metals referred to as one of the ‘Metals of Antiquity’.
Rise or Plunge
2018 will become very challenging to forecast silver’s price. There’s no clear view at this point. There are opposing forces at play right now, and silver could go either direction, but, even importantly, remain trendless.
On the one hand we see silver-friendly market forces in 2018:
- Some analysts anticipate some sort of a stock market crash this 2018, not necessarily the same as in 2008 but something sudden and strong. Stock markets will likely recover, but we anticipate that capital will flow out of the U.S. markets into emerging markets. If such an event will take place this 2018 then we can reasonably expect a flight to fear assets, first and foremost gold / silver as well as the Japanese Yen.
- There are some early signs of inflation picking up again. This is not strong yet, and certainly not confirmed. But with rising inflation one can reasonably expect gold and silver to perform strongly.
On the other hand some see the following headwinds for precious metals, in particular silver:
- Western central banks are committed to continue their rising interest rates policies. That is certainly not silver-friendly. Note that gold and silver were rising between 2001 and 2011 in a strongly declining interest rate environment.
- The U.S. dollar seems to be bottoming, as the 91 level is respected so far.
- Money is flowing into bitcoin and other cryptocurrencies. Some believe that this comes at the expense over capital flowing into precious metals.
Silver Price forecast
The only reliable way to do a silver price forecast this 2018 is generally by sticking to the silver price chart.
Silver markets look to be bearish, after the jobs number came out of the United States. Ultimately, this market will probably continue to bounce around the $17 level, looking for a reason to move to the upside. Due to tightening up in general, this market may be on a sideways direction. Silver may break above the $17.50 level, and the market should then go towards the $18.50 level, then potentially a break above there should send this market to the $20 level.
Let’s get things straight:
- As long as silver does not rise above $21 it has not broken out in which case it is trendless or bearish.
- If silver falls below $16 (and stays below 16 for at least 3 consecutive weeks) it is bearish.
- Between $16 and $21 silver is neutral.
- Moreover, $14 is a major price level as it marks the lows of the last 9 years. If silver sets a major double bottom between 14 and 15 in 2018 then (only then) will we become very bullish for the long term.