May is looking great for silver as the metal is outperforming its complex with more gains still in store, according to Orchid Research.
Silver prices are off to a solid rally after being left out of the gold price party in Q1. Spot silver has been even outperforming spot gold this month, up 6.7% since the beginning of the month while spot gold is up only 2.5%.
“We continue to favor silver over gold in the near term for at least three reasons. First, the silver price is relatively cheaper than the gold price judging by historical standards. Second, its positioning is cleaner (i.e., less crowded) than gold. Third, the re-opening of the economy could result in a rebound in industrial activity and therefore, a pick-up in silver consumption considering that 50% of annual silver supply is consumed by the industrial sector,” Orchid Research summarized in an Alpha Post on Wednesday.
In terms of price projections, Orchid Research is looking for a run up to $18 per share for the Aberdeen Standard Physical Silver Shares ETF (SIVR) in Q2. At the time of writing, SIVR was trading at $15.31, up 1.26% on the day. In the meantime, spot silver was trading at $15.83, up 1.67% on the day.