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Why Precious Metals are
Dropping Further in Mid-May




On early May 16th, silver was trading around 22 $ per ounce, gold was oscillating at around 1,470 $.

On Monday, May 20th, gold has already dropped below 1,350 $ and silver below 22 $. But both metals have recovered rather quickly, as bargain-hunters started buying in a matter of hours.

Silver and gold alike, have risen higher than the early day starting prices, on this Monday.

Nevertheless, precious metals are still on the downward slope. We're in a bear market. But why?

Where do the strong bearish forces originate from?


Here are the identified bearish factors that pulled precious metal prices down this May:

  The eurozone's Q1 GDP report reflected a 0.2 % decline for the respective period - as a result, the euro weakened, propelling the rival dollar higher

  The Japanese yen and other major currencies are weakening due to easing and inflation, thus the dollar is gaining strength, gold especially, but silver too is dropping

  Appetite for physical gold and silver has risen, but it's mainly due to bargain-hunting, so the spikes we've seen during April and May were rather short term

  ETF liquidations are continuing - there is physical and non-physical gold as well however, there's only one price (and as many are saying, "paper gold" is pulling physical's price down), but there's a lot more gold ETF liquidation going on, while a lot less in silver's case





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