October 2011 Silver Report

Happy Halloween everyone and welcome to your October Silver Report (2011). Was October a month for tricks or treats? What’s the future like for November silver? We hope to answer these questions and more and in so doing, help you to navigate this most tricky of stocks: silver!

Basic Overview for October

Once again, we saw, well, a mess in October, though a definite trend of ‘confusion’ prevailed. This has provoked no little panic among investors, with some gloomily predicted a steady drop to $10.00/oz by December, while others remain hopeful of at least a spike in November.

Now, there were some shimmers of hope. Silver rose slightly in early October, closing at $30.80 spot price on October 3^rd, which was a fifty cent increase (ok, not much, but still!). The reason for this was the economic turmoil in Greece driving investors to put their faith in precious metals in case of a paper money collapse. Other fears about a complete collapse in the American economy has made some people start stockpiling silver, figuring that it (and gold) will go back to being the regular currency once the credit card system implodes. (If this is the case, maybe you can stop paying your credit cards in the not too distant future!)

But, BUT! Silver prices were still zig-zagging badly. The week of October 10-17 saw some dramatic zig-zags with prices skyrocketing on Wednesday only to fall way down on Thursday. 24 hour shifts make any investor nervous! There was a slight trend of increasing prices; about.78% on average, but not enough to make anyone particularly happy.

Unfortunately, the next week (17-24), it all went to hell. Silver prices dropped by over 2%. Fortunately, a price correction at the end of the week brought prices back up, but there were still a lot of panicking investors hovering over their computer!

In the final week, investors who had been wringing out, but still holding onto, their hats were rewarded for their loyalty with a steady increase of about 2% a day. Is this the ‘phew’ moment or are we back on for a bumpy ride come November?

Will Silver Recover in November?

Cruising into Halloween, we see many investors sweating, with some gloomily predicting a drop to $10/oz by December and others remaining optimistic after the high of the week before. The big question of course is: Will Silver recover? Should we be singing “All I want for Christmas is two bouillons of silver”?

It’s still very difficult to say because silver prices (and gold) because there are a few important factors in November to pan out. First, the Euro Financial summit resulted in leaders agreeing to a number of pricey bailouts and credit hikes in order to give more breathing space for countries to brush themselves off after the Greek disasters. Most people are predicted that all the summit will do is end up buying time before the end; thus, people want to buy up silver now to hedge against the economic end of days. Others are looking at the slow but steady incline of silver in the past week as a good sign of things to come into winter. The American economy is also being looked at closely because of its strong ties to the rest of the world. If these two economies start to even out, we’ll see silver prices rise again, so all you really can do is hope for the best.

Odds are good though, that November will be bumpy as well owing to the unease in Europe which probably won’t settle out until December at the earliest and the uncertainty swirling around the American economic market. One firm fact: silver and gold will always be worth something and if all goes straight to hell, we could be looking at silver currency again, so it may be worth holding onto your stocks to tie through the bumpy period.

We’ll be keeping our thumbs on the silver market in November, right alongside you. Good luck traders and we’ll see you at the end of November.