is silver a good speculative investment?
With silver hitting $18 an ounce and gold having passed $1000 an ounce many investment gurus suggest there may be a great leap in the prcie of silver. Yet right now the economy is in a deflationary mode. This deflation may be short term, but one must question how long silver’s price will rise? Since 2003 there have been six strong silver price rises. Each lasted seven to 12 months before the price dropped dramatically or entered a dangerous period of sideways motion. The average upwards period was 8.8 months and this price run that last broke in October has lasted eleven months. This suggests that the current downturn is the beginning of a strong correction or a period of sideways motion. Silver’s price is more volatile than gold’s price. The global economy is seeing a downturn. Silver is more affected by industrial activity than gold and silver has enjoyed a strong run up. These are all downwards pressures on the price of silver now. Speculators may be selling rather than buying silve
