Silver bulls stampeded back into the grey metal Friday after a two-month hiatus as renewed hopes of lawmakers agreeing to a coronavirus aid package sent the greenback tumbling. After initially saying that he was halting relief bill negotiations until after the Nov. 3 election, President Donald Trump reversed course late last week, offering a $1.8 trillion coronavirus stimulus package, moving closer to the Democrats’ $2.2 trillion proposal.
- Silver prices rallied Friday after renewed hoped of a coronavirus aid package passing through Congress sent the U.S. dollar lower.
- The ProShares Ultra Silver (AGQ) fund broke out from an ascending triangle on above-average volume.
- A breakout of the Global X Silver Miners ETF (SIL) above consolidation coincided with a bullish moving average convergence divergence (MACD) cross.
Furthermore, the commodity, which has outperformed gold by around 80% since the March pandemic-induced lows, also continues to gain in popularity as a substitute inflation hedge, given that it’s still relatively cheap compared to the yellow metal by historical measures. The gold/silver ratio currently sits around 75, comfortably above its 20-year median average of around 60.
Active traders can bet on silver using the two exchange-traded funds (ETFs) outlined below. Let’s take a more detailed look at the metrics of each fund and discuss several tactical ideas using technical analysis.
ProShares Ultra Silver (AGQ)
With assets under management (AUM) of $246.7 million, the ProShares Ultra Silver aims to provides two times the daily performance of silver bullion as measured by the fixing price, in U.S. dollars, for delivery in London. A modest 0.10% average spread and turnover of more than 2.5 million shares per day make the fund a popular choice for those wanting a leveraged bet on the silver spot price. As of Oct. 12, 2020, AGQ has returned 37.6% year to date