Silver Has Room To Run Higher Once It Breaks $16 - Andrew Hecht
Silver futures are within striking distance of $16 an ounce, trading at its highest level since mid-July, as momentum continues to build. March silver futures last traded at $15.92 an ounce, up 0.51% on the day. Meanwhile, gold futures also traded near a multi-months high above $1,300 an ounce. April futures last traded at $1,315.50 an ounce.
Andrew Hecht, author of the weekly Hecht Commodity Report, said that he thinks it’s only a matter of time before silver prices move significantly higher, with a break of $16 an ounce, signaling a move to the next major resistance level at $17.30 an ounce.
He added that a rally in both gold and copper markets will continue to be bullish for silver throughout the year.
“I like what gold’s set up and what it’s telling me about silver,” he said. “Gold broke out to the upside and I think it’s only a matter of time before silver follows. The more bid-up gold gets the better silver will do.”
Hecht’s comments come as the U.S. and China started a new round of trade talks. He added that there is growing optimism in the marketplace that a trade deal will get done sooner rather than later.
“Once a trade deal gets done, base metals like copper will take off and that will be another bullish factor to drive gold prices higher,” he said. “Until then, silver investors need to keep their eye on gold.”
Hecht said that he is also bullish on silver because of investor positioning. He added that the market can still go higher as open interest is below 200,000 contracts.
“Historically, silver hasn’t been a crowded trade until open interest reaches 240,000. As of yesterday, silver’s open interest was 195,000 contracts, which tells me that the market is not overly long,” he said.