Investors are constantly on the look out for value investments, something they can pick up at rock bottom prices with a good likelihood of delivering healthy returns. By many accounts, silver fits that bill. But before you go out to invest, you should know what the market looks like in 2019, and some of the biggest factors impacting prices.
Strength of the US Dollar
Commodities priced in US dollars, whether they’re primarily consumed by industry or used as investment vehicles like precious metals (or both), generally benefit from a weaker US dollar. There are several factors at play behind this trend.
#1 Higher International Demand – A weaker US dollar compared to other currencies means foreign markets can afford to buy more. Everything from oil to lumber to the metals used in electronics like silver come into higher demand.
#2 Investment Concerns – While demand drives up prices for commodities like aluminum and energy, precious metals used frequently as investment vehicles gain in strength because investors begin to lose confidence in the US dollar and other global safe haven currencies. Precious metals offer the same kind of liquidity as the greenback without the inflation risks.
According to a recent Elliot Wave analysis on DailyFX, the US dollar’s strength appears to have reached a pivotal moment, and dollar weakness is on the horizon. Meanwhile, silver prices are set to make a strong comeback.
The IMF’s global economic outlook for 2019 is a slowdown in growth and precarious recovery. Slowing global growth could go several ways for silver prices. These are two of the main conflicting factors and how they will impact the market:
#1 Declining Commodity Demand – More so than gold, silver is influenced by industrial demand. It’s used in medicine, electronics like smartphones and laptops, solar panels, food processing, and many more applications. When global demand for these consumer goods decreases, demand for silver follows suit.
#2 Stock Market Volatility – When investors are worried that they’re more likely to lose money on the stock market than see gains, they look for safe havens, one of which is silver. But global growth and Western stock exchanges don’t always reflect each other’s weaknesses. Many believe that booming gold and silver prices in the wake of 2008 were due to both huge commodity demand from a rapidly growing China combined with financial crises in the West.
How to Enter the Silver Market
Entering the market isn’t hard to do. Online silver sellers have made it easier than ever for individual investors to get introduced to the market. You can go online and search through a large inventory of coins, bars, and other bullion products, and have them delivered fully insured to your home or kept in global storage. Visit a silver seller such as Silver Gold Bull and you can enter the market at a low cost as conveniently as buying stocks.
Should You Buy Silver Now?
Market analysts seem to be on the same page that silver in 2019 is around base prices and there is very little downside. In other words, there isn’t much room for prices to go down, and you won’t find a better deal on a precious metal with a lot of upside.
Only you can decide if precious metals have a role in your portfolio. But if you decide they do, now may be an excellent time to buy.