A Mega Miner Merger - Silver Price Analysis

Soaring Gold Price Boosts Gold Miners

It has been quite the year so far for mining companies. A soaring gold price, combined with falling energy prices, has led to wide margins and rising share prices. However, the silver mining sector has been left behind somewhat. Could that be about to change?

Pan-American Silver Acquires MAG Silver

The big news for the sector came on Sunday, the 11th, when Pan-American Silver announced that it was acquiring MAG silver for a combination of cash and shares. See below:

While the past several months have seen some interesting mergers and acquisitions in the gold mining space, there has been little movement in the silver miners. Could this PAAS-MAG merger be a spark that starts a fire and increases investor attention to the miners and explorers? The larger mining companies certainly are sitting on large piles of cash these days.

Silver Price Battles $33 Resistance

But first we need the silver price to get going. With the gold price well over $3000/ounce, many are frustrated that the silver price remains below $33/ounce with the gold:silver ratio often exceeding 100:1. That $33 level remains the key, not only short term but long term. On the daily chart below, you can see the price of COMEX silver continually doing battle with $33 resistance.

Silver Price - Daily Candlestick Chart

However, price continues to find solid support near $32 and its 200-day moving average (the purple line on the chart above). As such, any move through $33 and then $34 will drag and stack all the moving averages into a bullish position. This is quite possible, so keep an eye on it.

SILJ ETF and Silver Miners Potential

Given the long-term correlation between COMEX silver and the GDX, an upward breakout will have a significant impact on all mining shares, not just the silver miners and the exploration companies. But let's focus on those areas this week.

A proxy for the silver miners is the ETF with the symbol SILJ. So far in 2025, the ETF is up about 30%, which isn't terrible. And it's near the top of its recent price range, so any breakout above $13 will certainly get some attention.

SILJ - Silver Miners ETF

Note, too, that our merger companies of PAAS and MAG aren't even on the list of top holdings for the ETF, so there's certainly some room for "M&A Fever" in this sector.

Toronto Venture Market Showing Early Signs

Let's check the weekly chart of the SILJ too. It shows why so many are frustrated, even with 30% gains YTD. The ETF is actually still down about 20% from its highs last October! But as we saw on the daily chart, if price can clear $13, there's nothing to stop it from heading back to $15-16 or even higher as 2025 progresses.

SILJ - Silver Miners ETF

As we widen our scope, there are some interesting movements in the Toronto Venture market too. This market has been a disaster of underperformance and frustration for years as cash and investor interest has fled the sector. However, could things be starting to turn around? A few analysts believe that the chart is beginning to show some promise.

In summary, let's watch now to see if this PAAS-MAG news can act as a catalyst for some decent gains in the silver miners. With a little help from the silver price, we could get a nice summer rally in the shares, and that would go a long way toward relieving some of the frustration and angst many are feeling toward the sector in 2025.

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