Even though silver prices today (Friday) are down a relatively flat 0.59%, they're up more than 10% so far in February, and the rally won't end here.
Thanks to that "party animal" Ben Bernanke, silver prices today are enjoying a nice bounce.
That's because the U.S. Federal Reserve chairman, along with the other members at the Federal Open Market Committee (FOMC) meeting yesterday, decided to keep the quantitative easing (QE3) flowing steady with $85 billion of bond buying per month.
After the Fed announcement, silver prices rallied by 5.5% to more than $23 an ounce. That's the precious metal's biggest one-day gain since June 28.
Silver prices today touched the highest level since May. With all the market “crash talk” going on, here are four reasons to bet on silver now. Read more...
Metals started the week in the red, leading investors to ask why silver and gold prices are falling today. Money Morning Capital Wave Strategist Shah Gilani joined FOX Business' "Varney & Co." to answer that question.
He told host Stuart Varney about the big trading move that pushed metals down today. He also explained why he would keep buying gold.
Shah also recommended a stock that pays a 10% dividend yield and says the stock will be "safe" as long as the housing market remains stable.
Hear Shah's recommendation and his thoughts on why silver and gold prices are falling in the following video.
All bull markets go through periods of consolidations and corrections. And precious metals are no exception.
There has been plenty about gold's swan dive, but less talk about silver. And at this point there's more potential for silver than gold...significantly more.
Our Money Morning resources expert Peter Krauth explained the reasons behind gold's fall, so we went back to him to find out the deal with silver prices. Will silver keep falling? Is it a buy at the lower levels?
Here's what Krauth offered for investors.
Money Morning Staff: Peter, are silver prices falling because gold fell, or are there other factors at play here?
Peter Krauth: There are two factors.The first is that silver follows gold rather closely, and usually amplifies its behavior, both up and down. However, it can and does sometimes detach from gold and behave independently, but this is more of a rarity.
The second is silver's industrial demand.
As we've explained before, manipulation of gold and silver prices is happening right here in the United States.
Our Global Resources Specialist Peter Krauth interviewed silver market analyst Ted Butler last year, who explained how big financial institutions were using high-frequency trading to depress silver prices.
Good news for those investing in silver: The price slump is ending, making now a good time to buy.
Silver prices have slid since the start of 2013, and the white metal's down nearly 9% so far this year. Silver, which had hit a record high of $49.79 an ounce in April 2011, was trading for $29.36 Tuesday afternoon.
So far in 2013, buying silver coins has been one of investors' favorite ways to profit from a climb in the white metal's price.
The demand for physical silver from small investors in the form of coins is really remarkable. A record 7.5 million ounces of silver coins were sold in January.
The world's most respected precious metals consultancy, Thompson Reuters GFMS, came out last month with its 2013 forecast for silver prices.
After being bearish on silver prices over the past few years, GFMS has come around and predicted a good year for silver investors in 2013, with gains as high as 38%.
While gold, with its sky-high prices, gets most of the media attention, investors should be just as interested in how to buy silver.
Silver turned in a solid performance in the second half of 2012, rising from a June 28 low of $26.13 an ounce to its recent reading above $33.00. And, to steal a line from poet Robert Browning (or, if you prefer, Frank Sinatra), "the best is yet to come."
Money Morning Global Resources Specialist Peter Krauth said in his 2013 silver price forecast that the white metal, which closed at nearly $33 an ounce Wednesday, could hit $54 an ounce next year.
In fact, Krauth said he likes to think of silver as "gold on steroids."
But investors have largely overlooked another key factor that will contribute to higher silver prices over the next couple of years.
That's global industrial demand for silver, which will start to take off in 2013.
On Tuesday, spot silver increased to $34.26 an ounce, its greatest level since the middle of October, before it dropped to $33.76.
Silver traders have hit the sidelines as economic news such as fiscal cliff discussions, the Greek bailout and an appreciating U.S. dollar have been a drag on the white metal.
James Steel, HSBC metal analyst said to Reuters of the current prices, "We believe gold and silver prices will tend towards consolidation, as investors await further developments on the U.S. fiscal cliff negotiations."
But don't worry silver bulls, there's still enough good news to keep you happy.
Recent economic data and concerning news from abroad have hit precious metals this week, leading to their declines.
Gold has been stealing headlines as fear surrounding the fiscal cliff drives investors to seek safer assets. Should Congress and the president not reach an agreement by early next year, this will provide an opportunity for gold to shine.
But the white metal, with its volatility and recent high prices, can hold its own and also has the potential to increase in the short-term due to a few reasons.