Commodity ETF Alert December 2013 Issue

| December 10, 2013

 

Commodity Outlook:  Silver

Ask any precious metals investor and they’ll tell you the same thing…

2013 was an absolutely lousy year for anyone bullish of silver.

Starting in early April, the metal started falling off a cliff.  In fact, silver dropped from $28 an ounce to just under $19 by the end of June.  That’s a whopping 32% drop in just two short months.

Thankfully, we avoided this devastating decline in the Commodity ETF Alert portfolio. In fact, we haven’t been involved in the silver market since February.

But that’s going to change right now…

As you may know, silver is currently trading around the $19 technical support area.

Take a look…

Silver Chart

Not only are there high odds of a classic “double bottom” technical pattern at this price area, but certain fundamental factors are making it a great time to buy the metal for the long run.

What do I mean by “for the long run”?

Quite simply, silver will likely continue to have its fair share of up and downs in the near term.  Like I mentioned in the last update, inflation levels currently aren’t worrisome enough for investors to pick up the metal hand over fist.

But for producers of this commodity, the price is simply getting too low…

With the metal under $20 an ounce, silver miners are suffering.  Most can’t bring the commodity out of the ground profitably at these levels.  In fact, some miners are already shutting in production due the dramatic decline in prices.

As a result, the silver market will eventually encounter a supply shortage.

And when that happens, the price of this metal is virtually guaranteed to rise.  I’ll explain more around this important point in our monthly update in a few weeks.

For now, let’s just focus on getting into the silver market at these bargain basement prices.

As many long-time readers are aware, the iShares Silver Trust (SLV) is one of the best silver ETFs available.  Now’s the perfect time to get into this ETF for long-term gains!

Technically Speaking:

SLV Chart

As you can see, the chart for SLV is nearly identical to the one of silver above.

A double bottom pattern, which is when the current price bounces off a previous low, is forming as we speak.

This low-risk technical pattern provides us a great long-term buy point!

 

WHAT TO DO NOW:

iShares Silver Trust (SLV) is trading at $19.66
Buy SLV up to $20.00 per share
Our profit target is $35.00 or more

 

Category: Commodity Trading