Anticipating the Rise and Fall in Gold and Silver Prices
Gold and silver are two commodities that may never go out of fashion. They are worn as jewelry, used in electronics, and hailed as sound investments. However, their prices do see a lot of fluctuations in the market. While no one can magically find out how much the price of either commodity will be, you can anticipate it. Here are a few ways to anticipate the rise and fall in gold and silver prices.
Reacting to News
A myth surrounding gold and silver price prediction is to react to whatever you hear on the news. People think they can profit off short spikes and dips. While you may get lucky every now and then, this isn’t a great long-term strategy. However, one thing that the news can help in is gauging the relative strength of these commodities. If a barrage of good news regarding either commodity comes along, its strength will certainly increase. In contrast, any negative news will impair the price of gold and silver in the open market.
Gold prices also play a part in anticipating silver prices. There is an actual gold-to-silver ratio, which is a debated relationship among analysts. However, general trends show that gold and silver prices often fluctuate together. What we are saying is that if you see gold price rising there is a good chance that silver will also rise.
Negative News on Economy, generally favors Gold & Silver as when people lose faith in the national currency say the dollar, they begin to want hard assets like gold and silver.
Anticipating Silver Prices
One tip to keep in mind is that short-term changes are usually influenced by technical factors and long-term ones by fundamental factors. For example, technical factors would include things like the unveiling of a new product that heavily uses silver. Fundamental factors would include supply and demand, global and national economic trends, and inflation.
Other factors include direct and inverse relationships between silver and other commodities. The strength of the dollar, the leading global currency, has an inverse relationship with the rate of silver.
If you’re just using trends to evaluate silver prices, that method may work in the short-term for a few months. In this instance, you should take a look at predictive charts. Using 30-minute, 15-minute or 1 to 2-hour charts for predicting silver prices is a good idea. This way, you can look at important resistances and supports that validate or invalidate your analysis.
Anticipating Gold Prices
The demand and supply of gold affect its price more than any other factor. Gold and inflation also have a pretty solid relationship. When high inflation abounds, people begin to invest in gold as a safe commodity. It represents a much safer investment than paper currency at the time.
Gold also has a solid relationship with the dollar. When the prices of different currencies in other countries rise, so does the value of gold in those countries. Geopolitical crises and economic crises in general drive up the price of gold. It just represents a commodity which is stable in times of turmoil.
There is an inverse relationship between Gold and the dollar as well. If dollar weakens in value, then gold prices are pushed up. This is because currency investors usually invest in gold to preserve the value of their investments. If you want to sell your gold and silver at great prices, you can do so here, at CashforCoins.Net.
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