“I do think it’s the chance of a lifetime for investors now,” said David H. Smith of the Morgan Report and Money Metals.
Silver has experienced strong price momentum this year, but so far the white metal hasn’t been able to break through the key US$30 per ounce level.
For David H. Smith, senior analyst at the Morgan Report and a contributor to Money Metals, it’s only a matter of time before that happens, and investors should make sure their portfolios are ready.
“The resistance level is around US$30, and whether that happens within the next week or two, or it takes a month, (it’s) hard to say,” he told the Investing News Network. “Once it gets a couple of closes above US$30, I think everybody is going to be jumping on board — the big funds and everything.”
In his view, market participants should be cautious about trading in and out of silver right now. He anticipates that the precious metal will keep running quickly after it moves through US$30, and ultimately there may not be time to get back in.
“When this thing really gets underway and decides to challenge the high US$30s and into the US$40s, I don’t think it’s going to take any prisoners,” Smith explained.
Looking at what’s been driving silver this year, Smith identified factors related to both supply and demand. On the supply side, he mentioned that silver was in its fourth year of declining production even before COVID-19 hit. Meanwhile, demand has been high enough that it’s been hard to get physical metal.
Smith emphasized that the important thing for investors to do is be prepared.
“I do think it’s the chance of a lifetime for investors now. And it’s an asymmetric chance of a lifetime — you don’t need to mortgage the house to do well, you can buy a modest position of physical, and a few good mining stocks and hold on. You may be shocked at what you see in just a few years in terms of the appreciation on both of those metrics,” he said.
Watch the interview above for more from Smith, including his thoughts on silver stocks and his expectations for new discoveries over the next 18 months.
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Securities Disclosure: I, Charlotte McLeod, hold no direct investment interest in any company mentioned in this article.
Editorial Disclosure: The Investing News Network does not guarantee the accuracy or thoroughness of the information reported in the interviews it conducts. The opinions expressed in these interviews do not reflect the opinions of the Investing News Network and do not constitute investment advice. All readers are encouraged to perform their own due diligence.