Image Source: Pixabay
 

After years of the dark days, it sure has become a good time to be a silver investor. Because after watching the silver futures break the $40 level on Friday for the first time since September of 2011, over the holiday weekend, the futures broke through the $41 level too.
 

You can see in the chart above that the futures are a little bit off their highs of the day, which reached as high as $41.99.

It also feels like we're quite a ways away from the silver sell-off at the end of July that left the price as low as $36.28, not all that long after the futures had come within 9 cents of breaking the $40 level a few weeks earlier.
 

Although not to be outdone, the gold futures had a huge day on Tuesday as well, rising by $86 to cross over the $3,600 level, another new all-time record high for gold.
 

CNBC chalked the move up to seasonality and expectations of a September rate cut.

That assessment seems relatively accurate, as I do feel like the main driver right now is that the market has finally realized that the cuts are coming.

I'm not sure the average Wall Street investor has fully grasped yet that even after Powell cuts rates, Trump is going to bring someone in who will cut them even more. But my suspicion is that that will have an even further impact on gold and silver before it's all said and done.

In one of the interviews I recorded today, my guest talked about how he feels that gold responds to fear and uncertainty even more than inflation. And given that we did get the following news today, this likely contributed to the rally as well.

I also thought this headline below about the 30-year yield rising in response to the possibility that the Trump administration would have to actually repay the tariff money contributed to the rally too.

The 10-year yield remains on the lower end of its recent range, although if it turned out that the tariffs did need to be repaid, that could change somewhat quickly.

Ultimately, I know on days like this that the excitement about the prices gets pretty intense, and some investors start to expect that we'll be blowing through $50 by the end of the week. And while a continuation of the rally is certainly possible, I don't know that I would necessarily pencil in $60 or $70 silver by the end of the year just yet.

Hopefully throughout this year in particular, we've all learned that even during a rally, there are pullbacks. That are often severe and abrupt. And I don't see any reason why we would not continue to have those. Which is not to say that the price can't reach $50 this year, but just a reminder to keep it all in a healthy perspective.

But with my soapbox moment complete, hopefully you just had a fun day watching another exciting rally in the gold and silver markets, which is something I think a lot of us have been waiting years to experience.

We do have the latest labor report coming up this Friday, although that will be here soon enough, and for now hopefully you just enjoyed what happened today, and I will look forward to checking back in with you tomorrow.

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