There will be enormous distortions in all markets, namely, in the bond market, the stock market, the metals market and the cryptocurrency market, Morgan explained. While there have been many physical purchases of silver for investment purposes this year (global silver ETPs have increased physical holds by more than 280 million ounces up to the last week of July of this year, representing more than 360 percent of India's demand for investments in silver bullion in 2011), money in the futures market is likely to serve as an additional catalyst for prices. In the long term, there is no doubt that both the net positions managed in gold and silver will reach another all-time high, since the outlook for the global environment is likely to be highly inflationary due to the massive printing of money. While the silver price forecast is affected by supply and demand, it is also heavily influenced by investors who buy precious metals as safe haven assets during times of economic or political uncertainty.
Jeffrey Christian, managing partner of the CPM Group, believes that while the prices of gold and silver may be suffering a short-term hit, investors with a longer-term market view may view this fall in prices as an opportunity. The most important action you can do right now is to learn more about how silver can protect your wealth. After all, silver is a safe asset that generally does well in times of crisis, and the past year was plagued by tense geopolitical events along with the current COVID-19 pandemic. In fact, the year may also mean slower growth in industrial demand (with a forecast of 6 percent), jewelry (11 percent) and silverware (23 percent).
The war between Russia and Ukraine, rising oil and gas prices, and rising inflation have further increased global economic uncertainty. Despite the all-time high of gold and the recent strength of silver, one surprising fact is that the net managed positions — net of long and short positions — of money managed in both gold and silver on the Comex exchange are still well below their respective historical highs, suggesting that the futures market is still on track to support force. This would suggest that market confidence in silver has overheated and, normally, a sharp correction should be imminent in the short term. You can also speculate on the price of silver by buying silver ETFs, such as the iShares Silver Trust (SLV) and the Aberdeen Physical Silver Shares (SILV) ETF.
In the long term, greater investment in silver exploration and development will be needed to maintain mining production. Silver hasn't performed as well as gold, but lately it's been moving pretty well for bulls. Market participants interested in investing in silver would do well to consider these ideas when trying to determine where the spot price might move in the future. Not only do silver and gold feel love, but also oil, wheat, aluminum, nickel, soybeans, corn and others.