Silver Squeeze: Better Than Any Meme Stock

It’s range-bound, until it’s not. That’s the nature of silver, which can stay in a price range for months or even years, until the tourists get bored and sell. Then, silver shoots higher and rewards the serious investors for their patience.

The next thing you know, more tourists and price chasers come in because silver is suddenly in the mainstream news. Pundits who really couldn’t care less about precious metals start talking about silver as if it’s a new, shiny object.

Silver is certainly shiny, but it’s been around for millennia and continues to store value extremely well. What is relatively new about silver, though, is that it will be in high demand for solar panels and electric vehicle batteries.

It’s hard for me to imagine investing in the future of clean energy without owning at least a little bit of silver. This, coupled with silver mining stocks for some added leverage, rounds out a full portfolio position for higher silver prices.

You must admit, it’s funny watching the mainstream media scrambling to figure out what’s pushing silver above $31 per ounce after so many months in the $20s. The catalysts were all lined up and evident for anyone who understands supply and demand.

Courtesy: Yahoo Finance

They’ll tell you that the surge in silver-buying volume is unexpected and unfathomable. But again, that’s how it works: unless they have extremely lucky timing, investors have to patiently wait out the quiet periods before they can reap the rewards of the big rallies.

Here’s a pro tip. Reviewing your reasons for owning silver will help you to stay invested during the quiet periods. One reason is that the silver supply was constrained during COVID-19, and it takes time for the silver supply to recover after a shock of that magnitude.

Another reason, as I alluded to earlier, is that the clean energy movement will precipitate silver demand throughout this decade. Just the imbalance between supply and demand, by itself, should be sufficient to get the silver price above its prior 2011 high of around $50 per ounce.

On top of all that, bear in mind that in America, silver’s value is typically measured against the U.S. dollar. If you expect the dollar’s value to continue to decline as the government prints money endlessly, it’s undeniable that the silver price will increase over time.

Along with patience during the quiet periods, you’ll want to train yourself to tolerate some volatility along the way. Silver tends to move faster than gold, so there will be sharp daily price moves in both directions sometimes.

Courtesy: @MrWWolfe

Don’t get me wrong. It’s perfectly fine to enjoy the “silver squeeze” rallies. When silver breaks above crucial levels, like it just did recently, it can be exhilarating to watch the price shoot higher.

Heck, you can even join the #silversqueeze community on Twitter/X and celebrate silver thrusting above $30 and $31. Keep in mind, though, that not everyone on social media is an expert on the financial markets.

While you’re on social media or if you’re listening to the mainstream media gurus, you might hear someone comparing silver to meme stocks. It’s not a fair comparison. Sure, #silversqueeze might sound like “short squeeze,” but silver isn’t the same as an unprofitable business that just happened to capture the attention of meme-stock traders.

Rather, silver is a tangible, historically important commodity that has real-world monetary value. So, feel free to welcome the new silver tourists and price chasers – and also feel free to educate them on the differences between meme stocks and essential, enduring assets like silver.