Why One Trader Thinks "Silver's Plunge Is Nearing Completion"

Precious metals fans have had to content with a triple whammy this year: not only is the dollar weaker, not only have cryptocurrencies - seen by some as a natural alternative to safe PMs, especially among the younger generation - soared since the start of the year, blowing out all other asset classes including precious metals, but gold and silver have largely gone nowhere despite a year of political volatility and central bank confusion.

here is a ray of hope however: according to Bloomberg's macro commentator Marc Cudmore, silver's "justified" plunge - as gold and silver have a strong correlation with real rates - is finally nearing completion, as "we are approaching the point where both higher yields and lower yields have the potential to boost the asset class."

The technicals are also turning: "In euro terms, silver is looking stretched to the downside based on its relative strength index, a momentum measure. It should also be supported by its 31-month upward trendline, which it’s testing now." Finally, "Monday is the first day of silver and gold futures trading on the LME. That might provide a fresh source of excitement and buying interest."

Finally, while there are "clear dangers involved when trying to catch a falling silver knife" Cudmore notes that "a risk-reward analysis makes an attempt appealing."

His full Macro View take below: http://www.zerohedge.com/print/599469