Increase In Silver Spot Purchases

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Increase In Silver Spot Purchases

Increase In Silver Spot Purchases Keeps Rising - Tds

Silver (XAG/USD) chart shows a strong increase in the price. This comes as around 70% increase in net length was seen in many CTA buying programs.

Also, the ratio of the Gold/Silver is at a very high level, which is not normal at all. Given this, TDS believes that strong prices will also attract the interest of discretionary traders. After all, the cohort is almost flat as of late, while the Gold is at historic highs.

Gold/Silver Ratio Remains Elevated

All of this has also pushed the ratio of XAU/XAG to really high levels. This also points to the fact that demand for the broader commodity market remains strong and resilient. Looking ahead, there are no signs of weakness in the commodity market, even in the near future.

If we look back, these conditions have increased Silver's relative value in regard to Gold. Looking ahead, the CTAs are expected to retain their holdings in the Silver unless something major happens. So, that's also something that shows that the breakout is highly unlikely to fail.

Another thing that makes things difficult or complex is the tariffs. On the surface, it appears that the US government wants to make better trade deals, and the trade tariffs are their way to achieve it.

It seems that the tariffs on China will stay while the USA will work out a deal with Canada, Mexico, & other countries. However, the chances of higher tariffs for long are also equally high, which makes things difficult.

In general, anything that raises the geopolitical temperature will benefit metals like Gold and Silver. On the other hand, higher tariffs could also hamper the demand for Silver and other metals.

Amidst all of this, things are looking unclear for the Silver market. However, TDS analysts believe that Silver prices will remain strong this year.

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