Octa broker’s analysis: Could silver outshine gold as the top investment in 2025? Business Insider Africa

However, it is crucial to understand that while leveraging can increase profits, it also carries a heightened risk of amplifying losses. In futures and CFD trading, where leverage is commonly used, a minor unfavourable price shift can result in losses that exceed the initial investment. Silver prices can be highly volatile, influenced by various factors such as industrial demand, investment demand, geopolitical events, and changes in economic indicators. Investing in silver mining stocks provides exposure to the silver market. These stocks can be affected by both the price of silver and the operational performance of the mining companies. Silver futures allow traders to speculate on the future price of silver with a fixed end date.

Traders can buy silver when the range hits the support zone and then sell them when the price hits the resistance zone. This strategy is really good if we want to approach your investment with a low-risk high-reward outlook. For example, in 2007, just four months before the great recession, the silver price stood at $11.95 per ounce. By February 2008, it was trading at $19.24 per ounce, due to the influx of investors trying to seek refuge in the stability of this market. The silver-to-gold ratio is a ratio that shows us how much silver we would need to purchase one ounce of gold. If the ratio of silver-gold is 80, it means that we would need 80 ounces of silver to purchase one ounce of gold.

Silver trading can be volatile, and it’s crucial to build your experience before making larger trades. With silver CFDs on VT Markets, traders can start with a relatively low deposit due to leverage. This will help traders to better understand the market, as they are not dependent on just one specific indicator. When prices are not breaking limits and usually reach the same levels again and again over a period of time, it means that we are in a range-bound state. Support and resistance indicator levels are used to determine the range and upper and lower limits within this range.

• Usually, the market is liquid when it is volatile, so when you see high price fluctuation it might be the best time to trade silver.
• Silver’s near-term direction depends on the Fed’s tone and economic data.
• The silver market refers to the collective buying and selling of physical silver or silver contracts.
• Whether you’re a beginner or an experienced trader, this guide will provide valuable insights to help you navigate the silver market with confidence.

Investing in gold is by far the most popular choice during such economic slumps. But just like gold, silver also holds the status of a safe-haven investment, and it attracts the attention of many investors because it is cheaper than gold. When the economy crashes, governments tend to lower interest rates, to encourage customer spending.

Step 1: Learn the Market Fundamentals

But it’s also reasonable to think that the market is being manipulated. BullionVault and BullionStar are online bullion dealers you might consider. Such bullion dealers typically list silver prices measured by the ounce. Choose a reputable broker or trading platform that offers silver trading. Look for platforms with low fees, reliable customer support, and educational resources to assist with your trading decisions.

Investing in silver is an effective way to speculate on interest rates, as silver is highly responsive to that market. Additionally, it is a precious and industrial metal, making it highly sensitive to global demand. Gaining expertise in silver trading can significantly broaden your portfolio and introduce a new source of potential profits to your trading. The silver market comprises diverse participants with differing perspectives on the metal’s future. These views, combined with shifts in supply and demand, sentiment, and other factors, contribute to the ongoing price movements in the silver market.

What is commodity trading and how to trade commodities?

This is because share prices are dependent on operational factors as well as movements in the silver market. Silver is – like most commodities – mostly traded through the exchange of futures contracts. Analysing historical silver prices may give us information as to where prices are headed next and potential key levels to watch out for. Looking at the big picture, silver has seen many ups and downs, reflecting a variety of economic and political events, and it reached an all-time high in April 2011, hitting $49.76 per ounce. This volatility and frequent price fluctuations create numerous trading opportunities in silver. Prices are influenced by factors beyond silver production, such as interest rates and inflation, and it is often viewed as a store of value.

Changes in the ratio can affect silver prices by influencing trader behaviour. Unfortunately, a lot of retail traders believe that silver is simply the “poor continuation patterns cousin” of gold. While the two can move in the same direction at times, the reasoning for a move in the silver market can greatly differ from the gold market. Learning how to trade silver can greatly diversify your portfolio, and offers the ability to hedge from inflation concerns and currency degradation.

Moving average trading strategy

Additionally, high liquidity often leads to tighter bid-ask spreads, reducing trading costs and making it more attractive for participants to engage in these markets. Traders expecting the ratio to decline back to average levels may take a long position in silver while selling the equivalent amount of gold and vice versa. This can result in potential profits even if the price of both metals moves significantly. ETFs, or exchange-traded funds, provide a strategic approach to investing by holding a diverse range of assets within a single fund. This diversification helps mitigate risk, as it spreads investments across various sectors, industries, or geographic regions, rather than concentrating funds in individual stocks. Additionally, insuring your silver can provide peace of mind, but it also adds to the overall expense of investing in this precious metal.

Trading Accounts

When the ratio is high, silver is considered undervalued relative to gold, and vice versa. ETFs are generally passively managed investment vehicles that aim to replicate the performance of a specific index or sector. This means that they are designed to follow a predetermined strategy, requiring minimal intervention from fund managers. As a result, ETFs often have lower management fees and provide investors with fp markets review instant diversification across various assets.

Considering this, the demand is likely to outpace even the increasing supply. Although the demand for jewellery and silverware is to decline, gains are expected in the consumer electronics market and industrial fabrication. By using moving averages or drawing trend lines, you can identify which trend is prevailing in the Silver market and make successful trades accordingly.

The author has not received compensation for writing this article, other than from FXStreet. The Silver price declines to near the 20-day Exponential Moving Average (EMA), which trades around $32.95. Silver price struggles to revisit the flat border of the Ascending Triangle chart pattern formation on the daily timeframe near the October 22 high of $34.87. The upward-sloping border of the above-mentioned chart pattern is placed from the August 8 low of $26.45. Technically, the Ascending Triangle pattern indicates indecisiveness among market participants.

• Silver, as a non-correlated asset with an intrinsic value, can provide a hedge against volatility in other markets.
• Futures contracts have expiration dates, which means that if your desired price was not reached, you can either close the contract or roll over them to the next delivery date.
• The share prices of silver miners often track the value of the underlying metal.
• Silver investing and trading are two different methods to benefit from increasing Silver prices.

Each method has its advantages and risks, so choose one that aligns with your investment goals and risk tolerance. Market fluctuations are often driven by factors like economic reports, geopolitical events, and changes in supply and demand. This volatility can result in significant gains, but it can also lead to substantial losses. However, using proper risk management strategies can help mitigate losses. Understanding the factors affecting silver prices is essential for making 8 tips for adjusting to retirement informed trading decisions.

The Exchange Stabilization Fund (ESF) was established in 1934 to intervene in foreign exchange, credit, and gold markets. The ESF was initially funded by part of the US government’s paper gains from revaluing gold from $20.67 to $35.00 per ounce. Since that time, the US government has intervened in the gold market to try to hold down its price. Yes, Silver is a tradable, liquid, and profitable asset that gives traders high profits when traded directly or indirectly through a contract for difference. Even when you trade Silver through CFDs, the price at which you trade is dependent upon the actual price of Silver in the market. Hence, it is important that you are aware of any industry changes, global demand and supply mechanisms, and investment decisions related to Silver.

In the renewable energy sector, silver is a key player in solar panel production. It enhances the efficiency of solar cells, contributing to the growing shift towards sustainable energy solutions. As the global push for renewable energy continues, the reliance on silver in solar technology is expected to rise, driving demand even higher. If you’re wondering if there will be trading on the April holiday, here’s what you should know about the NYSE, Nasdaq and the bond market for 2025. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use.

As of June 2022, Silver (Trading code XAG) trades at $21.69 per ounce. The record trading price of silver was $48.70 which was reached towards the end of the 1970s. But this was not a fully legitimate evaluation at the time as prices were hugely manipulated. Silver is considered a solid investment by many traders, as it tends to be safe from economic crises. Call and put options tied to the value of silver futures, which are available through the CME.