In this blog post, we explore the dynamics of the silver market, the factors contributing to rising prices, and the implications of a potential silver squeeze for investors. I believe that chart analysis is a tool that is helpful for determining if a large move is likely ahead in the silver market. After all, this type of analysis helped me spot Bitcoin’s recent run-up ahead of time. Right now, silver futures are trading in a range between the $22 support level and the $30 resistance level that formed at the peak in early-August. If silver can push above $30 on strong volume, the odds of an even more extensive bullish move will increase.
As a long-time believer in hard assets such as gold and silver, that is a thesis that I can get excited about (unlike GameStop, which is extremely overvalued). The idea behind the “silver squeeze” thesis is that big banks and hedge funds currently have massive short positions in the silver market for the purpose of suppressing the price of the precious metal. According to this theory, if enough small investors buy into the silver market, the big banks and hedge funds will be forced to cover or buy back their short positions, which would send the price of silver soaring.
‘The Silver Squeeze’: Redditors Divided And Silver Value Soars As Online Traders Switch Focus To Commodities
As silver continues its upward trajectory, the potential for explosive gains has never been clearer. Many analysts believe that bullion banks like JPMorgan and UBS are engaging in aggressive naked short-selling—dumping silver futures without actually holding the physical silver to back them up—in an effort to manipulate silver prices downward. There is a strong chance that these banks will end up on the wrong side of the trade as this rally continues, triggering a powerful silver short squeeze.
Gold/Silver Ratio
Silver suppliers started seeing an increase in orders before February, but on February 2nd, something big happened. Gamestop and AMC certainly dominated news in the investing world during the first half of 2021. If you paid attention how to use virtual card at atm to what was happening on Reddit, though, you likely also heard of WallStreetSilver and the silver squeeze. CFTC Acting Chairman Rostin Behnam said in a statement Monday evening that the commission was “closely monitoring” activity in the silver markets. Silver mining stocks Coeur Mining and Pan American Silver surged 23.1% and 12.1% respectively on Monday.
- In 2023, the deficit reached 184.3 million ounces, with an even larger shortfall of 215.3 million troy ounces projected for 2024.
- Since the mid-2010s, silver has slightly lagged behind M2 growth, which, combined with other factors discussed in this piece, positions it for a strong rally.
- Silver mining stocks Coeur Mining and Pan American Silver surged 23.1% and 12.1% respectively on Monday.
- The silver deficit in recent years has rapidly depleted above-ground supplies, tightening supply even further.
- The person also noted silver stocks available to retail investors—First Majestic Silver Corp and the iShares Silver Trust ETF.
Bitcoin Price
By every measure, gold is in a confirmed uptrend, and I believe it’s on track to reach $3,000 in the near future. As if the technical outlook weren’t already bullish enough, silver’s fundamentals are just as compelling. Surging industrial demand, coupled with declining global mine how to run curl command in postman code example production, has kept silver in a structural deficit for the past four years—and there’s no sign of relief on the horizon.
Many of those involved say they want nothing more than for the price of silver to return to a fair and accurate level. As the world continues to transition to a more sustainable future, the demand for silver is only going to increase. With its unique combination of properties, silver is poised to play a vital role in the 21st century. In fact, some posts on WallStreetBets late Sunday and Monday suggested their movement is being co-opted by hedge funds and there is no coordinated effort in the silver market. This doesn’t mean manipulation isn’t taking place, though, and the saga of the Hunt brothers proves this is something that can happen. And even if you were to ignore all these facts, it’s impossible to overlook how to become a web development consultant the dwindling supply of silver.
When the silver short squeeze finally arrives, it won’t just be a market event; it will be a historic reset that reshapes the precious metals landscape for generations to come. Another way to assess whether silver is undervalued or overvalued is by comparing it to various money supply measures. M2 money supply, providing insight into whether silver is keeping pace with, outpacing, or lagging behind money supply growth. If silver’s price significantly outpaces money supply growth, the likelihood of a strong correction increases.
The key is purchasing gold and silver before the steep premiums that could culminate as a result of Basel III, the #SilverSqueeze, and inflation. If you don’t want to worry about market volatility, however, you’ll want to make sure you’re buying the right silver products. At one point, the billionaire brothers owned one-third of the world’s silver supply. Their actions caused the price of silver to rise from $6.08 per troy ounce at the beginning of 1979 to $49.45 just one year later. What most people don’t realize is that a similar “raid” already took place in history.