This could represent a great opportunity for investors in precious metals. The price of silver has fallen from a peak of $30.00/oz in Quarter 1 to just $23.75/oz Week. Taylor Dart shares his thoughts on why this may be an excellent opportunity for buying with rock-bottom sentiment. In the past year, investors in precious metals have seen the silver price (SLV), fall from a peak of $30.00/oz during Q1 to $23.75/oz each week. This has hurt the silver producers, with the Silver Miners ETF (SIL) down nearly 40% from its year-to-date highs, given the margin pressure that they’ve experienced. However, while performance has been quite weak year-to-date, the metal looks like it’s trying to turn around, and with sentiment at its worst levels in years, this looks more like a buyer’s strike due to disgust with silver’s performance rather than a seller’s market. Let’s take a closer look below:

Source: www.TC2000.com

In the above chart, you can see that the SIL performance since last year has been horrible. The ETF fell from a high of $50.00 to below $30.00 and then saw a slight rally. Catching falling knives is not a wise strategy in an emotionally charged sector. The ETF rarely trades on fundamentals for the short term. There comes a time when fear and pessimism turn into complete panic and capitulation. This is what happened to silver last month and many other silver producers. Based on the sentiment moving average, bullish sentiment fell to its lowest level in three years in October. The September 2018 event was a significant bottom for precious metals. History does not have to repeat itself, but if there were ever a time to be open-minded to buying the dip, we’re getting very close to that point.

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