FxWirePro: Silver Eyes $20 Area
In past three weeks, Silver has shrugged off its underperformance against other commodities including that of gold and in that time it is up more than 12%, looking to gain further. Silver traditionally has been much more volatile than the yellow metal and is not considered as a safe haven assets.
But what we are seeing here is not a safe haven rally but a risk rally in line with hunt for store of value. As Dollar weakens, currencies as well as commodities have rallied. As Dollar weakens, long 18 month long Dollar positions are getting unwind and money looking for Alternate store of value. Cheap silver provides an excellent opportunity for such.
Gold/Silver ratio, which measures cheapness of Silver against Gold, reached highest point in more than seven years, making silver cheapest since financial crisis, compared to gold.
Technically speaking, Silver has broken above a key resistance around $16/area, after finding support around $14 and now likely to extend its gains towards next levels and probably around $20/troy ounce area.
Trade idea –
Buy Silver at current price $16.7/troy ounce, and at dips, targeting $17.3, $17.8, $18.4, $19 and $20 area with stop loss around $14.8 area.
The material has been provided by 
