More than likely, recent market rallies in silver have come as the result of short-term trading disruptions that will probably turn out to be temporary in nature. However, that’s not to say that recent developments are insignificant in any way. Without much doubt, the Reddit Revolution will fundamentally change the way stocks are shorted throughout the market-at-large https://www.day-trading.info/fxcc-com-cyprus-based-forex-trading-broker-review/ and shift the dynamics that have traditionally existed with respect to the retail trading community. When we last covered the emerging dynamics that are currently controlling prices in silver markets, the sometimes forgotten metal was trading near $24 an ounce and many analysts seemed to be saying that the “Great Silver Rally of 2020” might be coming to a close.
Their ultimate goal is to “squeeze” the market and increase silver prices. Of course, we know that silver has recently moved to trade near its highest levels in eight years and this is why short-term long positions based on hopes for a new “short squeeze” in the precious metals market are simply not justified. Many have also piled into the one-time-joke cryptocurrency Dogecoin, which was inspired by a viral image of a Shiba Inu dog. At various times, Robinhood has suspended purchasing for some meme stocks, a move that sparked almost universal outrage prompting angry consumers to tank the app’s rating on online stores with a flurry of one star reviews and politicians vowing to investigate. At its peak, Robinhood restricted trades from 50 companies, including GameStop, AMC Entertainment, BlackBerry and Nokia. Interestingly, the Reddit post in question argued that a new retail movement to establish long positions in SLV would force fund managers to buy physical silver and establish new shares so that supply shortages would emerge.
With each piece we write, we bring our own personal experience and expertise, while combining that with today’s leading research and data. Our ultimate goal is to help extend our award-winning customer service to our educational content. Ultimately, we want you to feel comfortable and informed when making investment decisions, regardless of whether that is with us or not. What most people don’t realize is that a similar “raid” already took place in history. During the inflationary period in the 1970s, William Hunt, Lamar Hunt and Nelson Hunt set out to corner the market on silver. They purchased both physical assets and paper silver (e.g. futures contracts).
However, recent activities in the market have belied the true nature of the bullish moves we have seen in the commodities space over the last year and we think that investors should continue to move portfolio holdings into assets with precious metals exposure. To short, or short-sell means borrowing a share or commodity, and then selling it. If the price falls, I can buy it back at a lower price, return it to the lender, and pocket the difference.
If a lot of new investors rush to buy silver, raising the price, the short-sellers will be forced to buy it back at a much greater price. It’s more complex than that, but this is the bones of a silver squeeze. As of 1 February 2021, the price of the precious metal has hit a seven-year high at $29.40 (£21.48) per ounce. WallStreetSilver is right about short selling having a major effect on the price of any asset. After all, many of those “short” on silver are the same ones who produce the metal for retail use.
The massive reduction in silver used in American coins is a major reason behind this decrease. If the U.S. government suddenly had a need for silver at its 1970 levels, they’d have to purchase over 300 million ounces to meet it. In fact, we could make an argument that WallStreetSilver single handedly created the current drive to buy physical silver.
The price of silver rose less than $4 between Friday the 29th of January and Monday the 1st of February. Thereafter, for the remainder of February prices actually dropped below the spike high but remained above the pre-squeeze levels. Initially, the orchestrated activity succeeded in drastically raising share prices but the exponential rise was cut short as retail brokerages, most notably, Robinhood, restricted the purchasing of the meme stocks citing increased clearing firm charges. “There’s far more cash trying to chase physical assets because we’re suffering the bite of inflation, and supply in all of these markets is becoming extraordinarily thin,” explained Eric Sepanek. Watch his full analysis of the forces about to set off a physical silver rally on AZTV’s Mike Broomhead show.
Because of these decreases, many people called it history’s “greatest theft in the silver market.” The raid that found its roots in WallStreetSilver intended to push back against price manipulation. Some of the biggest recent happenings in the investment world https://www.topforexnews.org/investing/tips-for-forex-trading-beginners/ have arisen thanks to users of the Reddit website and app. The insane increases seen in GameStop and AMC share prices had their inception in the WallStreetBets community, and the big news in silver is at least partially attributable to WallStreetSilver.
I’ve been very optimistic about the outlook for safe-haven assets like gold and silver. Because I had been correctly expecting a serious economic crisis, I have favored safe-haven assets over risk assets such as stocks and real estate. I still believe that these safe-havens will thrive in the years to come as central banks continue to flood the world with liquidity in an attempt to prop-up the debt-ridden global economy. algorand price today algo live marketcap chart and info Investors that have been in this game for a while might be tempted to refer back to the surprising ability of the Hunt brothers to influence prices in silver markets. However, we must also remember that the market has undergone significant changes in the 40-year period that has followed those historic events – and we believe that a similar outcome is looking highly unlikely in the current market context.
So retail investors, driven by Reddit and social media, are piling cash into GameStop shares. The silver price — so the theory goes — has been artificially held down by people (hedge funds, institutions, etc.) who ‘short’ silver. And the iShares Physical Metals Physical Silver ETC (ticker SSLN) has just shot up into the top 10 most viewed investments on the Hargreaves Lansdown website.
In addition to this, today’s one-day percentage gain is the biggest since 2008. The below silver chart shows the one-day percentage change in price. Our community will provide tactical strategies that generate high levels of retirement income in addition to a specialized selection of high-probability technical trading ideas that are backed by solid fundamental analysis.
If silver can close above $30 in a convincing manner, the next price target to watch is $35 and so on. If last week’s trading activity is anything to go by, the price of silver is likely to remain highly volatile as traders will be keeping an eye on the “Silversqueeze” hashtag in their ongoing bid to rival Wall Street’s investors. Silver prices surged by more than 10% to over $30 an ounce Monday morning as Reddit-informed retail traders piled in on the commodity, the highest since February 2013.
If we look at the quantity of silver stored in London vaults, it is nearly 1.08 billion ounces of silver, according to the LBMA data released back in November 2020. This puts the silver valuation stored in these vaults to almost $32 billion. As this happens, it’s easy to foresee a significant increase in the price of silver. Many Wall Street insiders even bet that this will take place in the near future. Regardless of what ends up happening, there’s no denying that WallStreetSilver has forever changed the precious metals market.
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