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How Precious Metals and Miners Have Been Moving in 2016

Why Precious Metals and Miners Are Back on the Rise

(Continued from Prior Part)

Precious metal technicals

Gold snapped its two-day losing streak on Tuesday, April 5, as it gained 0.84% to close of $1,229.6 per ounce. Gold was trading at a 7.2% premium over its 100-day moving average price of $1,146.1. It was also trading above its 20-day moving average price. The premiums suggest a bullish sentiment for gold. However, a pullback in price in the future may also be expected with considerable premiums.

Silver was the top performer on Tuesday, rising about 1.2% and giving a close of $15.1 per ounce. Silver prices too are trading above their 100-day moving average price of $14.7 per ounce. However, silver is below its short-term 20-day moving average price.

Precious metal investments

Gold-based investments are easier to track with funds like the SPDR Gold Shares (GLD). GLD has seen a gain of approximately 16% on a year-to-date basis. Assets in GLD, the world’s largest gold-backed ETF, fell 0.28 tonnes to 815.44 tonnes on Tuesday.

The Global X Silver Miners ETF (SIL) was up 42.4% on a year-to-date basis. Miners’ returns are often amplified compared to the metals themselves.

Miners impacted

The silver miners that have earned a fortune in 2016 include companies like Pan American Silver (PAAS), Coeur Mining (CDE), and Silver Wheaton (SLW). These three companies have seen an increase of 68%, 131%, and 30.5%, respectively, on a year-to-date basis. Together the three silver miners make up approximately 7% of the price changes in the Market Vectors Gold Miners ETF (GDX).

Precious metal and miner investors are quite interested in further guidance from the Federal Reserve regarding the interest rate, as it was the most important factor affecting these investments in 2015.

Continue to Next Part

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