When Is the Best Time to Buy Silver?

Any time is a good time to buy Silver for the purpose of hedging against inflation. That is, purchasing physical Silver.

While acquiring Silver as a future protection against inflation of currency is always a good idea, it is better to buy Silver at the lowest price possible.

Market Timing, either based on fundamentals or technical analysis is a must.

Many investors look to fundamentals in order to decide when to buy or sell Silver. Fundamentals could include mining operations as to annual quantities pulled out of the ground, the market application of Silver (it has more commercial use than Gold, although this has dropped off since digital photography has replaced regular film.), and even what the Federal Reserve is doing as respects printing money.

Basically, if Gold goes up in value often Silver will to some degree. It is not a one-to-one relationship, but in terms of long-term trends they tend to appreciate or depreciate within the same approximate time-frame.

For that reason, you may want to consider my article on “When is the Best Time to Buy Gold?”

Like Gold, Silver increases in value when the dollar is weakening, and a strengthening dollar causes silver to decrease in value.

Another fundamental aspect of silver is industrial or commercial demand. When the supply of silver is relatively stable, it is the ebb and flow of demand that can affect silver prices. News about the expansion of the money supply can cause a rush of demand for Silver which thus increases its value.

The other approach to market timing Silver is using technical analysis. Here you do not follow production reports or news about oil or inflation, but instead you place indicators on a price chart.

An example would be to use moving averages. On a weekly chart of Silver, you could add a 10ema, 21ema and 50 ma to help determine trend. When the 10ema is above the 21ema, and both above the 50ma (ema = exponential moving average, ma = moving average), the trend is considered bullish and you might consider buying. If you are a speculator rather than an investor, you might consider liquidating when the 10 is below the 20 and both below 50.

There are other ways to use Technical Analysis on a Silver chart. This was just one possibility.

Whether you decide to market time using fundamentals or Technical Analysis, the goal is to buy at the lowest price possible.

Source by Rick Ratchford

When Is the Best Time to Buy Silver?