How Close Silver Squeeze Came To Breaking The Market Rick Rule
Even gold, often considered the ultimate precious metal, pales in comparison to silver’s diverse applications. Silver’s unique properties make it indispensable in numerous industries, from technology and medicine to energy and defense. 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. Thanks again for your analysis and explanation regarding the massive amount of shorts and their upcoming dilemma. Its goal is to closely mimic the performance of the price of silver.
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. As the price of silver continues to rise and the potential for a silver squeeze looms, investors should approach the market with caution and diligence. Conducting thorough research, diversifying portfolios, and maintaining a long-term perspective are essential strategies for navigating the silver market and capitalizing on opportunities while mitigating risks.
Explosive upside convexity in Silver markets remains underpriced – TDS
The next condition I outlined was that silver priced in euros must decisively close above the €30 resistance level, which was established at the May peak. I stated that this event would help confirm a close above $32.50, greatly reducing the chances of it being a false breakout. I find it valuable to analyze silver priced in euros, as this approach removes the impact of U.S. dollar fluctuations, offering a clearer view of silver’s intrinsic strength or weakness. Notably, silver priced in euros often respects round numbers like €26, €27, and €28, frequently establishing key support and resistance levels at these points. On Friday, silver finally broke through the €30 level with such momentum that it even closed above €31, signaling the strong potential for further gains in the coming week. A silver squeeze occurs when demand for physical silver outstrips available supply, leading to shortages and driving prices higher.
End the Fed? Why America’s backup plan may be its gold stash – Peter St Onge
I’m top 10 penny stocks on robinhood to buy under $1 in february focusing on $50 as a relatively short-term target because it’s a significant psychological level and the peak reached during both the 1980 and 2011 rallies. Another key confirmation I’ve been watching for is a breakdown in the gold-to-silver ratio, a useful indicator for assessing silver’s price trajectory. Keep in mind that Ghali’s projection of “slowing demand growth” is coming off record industrial demand, and we’ve already seen market deficits for four straight years. TD Securities senior strategist Daniel Ghali told Bloomberg that the threat of tariffs is already “accelerating the timeline to depletion” of the free-floating silver stock in London. He projects a significant supply crunch this year despite a slowdown in demand growth.
Gold/Silver Ratio
Meanwhile, growing global uncertainty 10 best cryptocurrency apps in 2021 has reignited interest in precious metals as a safe haven. Central banks continue their experiments with unprecedented monetary policy, while geopolitical tensions drive nations and individuals alike to seek tangible assets. And with silver being a depleting asset, the supply-demand imbalance is poised to worsen. That’s because the precious metal is heavily shorted – meaning there’s a large number of futures contracts predicting the price will drop.
- The looming threat of a short squeeze, combined with silver’s structural deficit, suggests that the price could climb significantly higher, potentially reaching levels not seen in decades.
- Even more exciting is the fact that silver’s logarithmic chart, dating back to the 1960s, reveals a cup-and-handle pattern, indicating the potential for silver to reach several hundred dollars per ounce during this bull market.
- Each may not have a large amount of capital, but together they are a force to be reckoned with.
- An advocate for free markets and sound money, Colombo was also named one of LinkedIn’s Top Voices in Economy & Finance.
- It is also the gold in their inventory of bars and coins and wire and whatever products they have ready for sale.
#SilverSqueeze: The Greatest Short Squeeze in History?
Buying physical silver or shares of silver stocks is a way to be involved in the so-called “Silver Squeeze 2.0.” When more investors buy a stock or commodity, short-sellers usually need to sell shares to cover their losses. SLV is one way to get involved, although you should always be aware of the risks in any kind of short squeeze. However, if that stock’s price increases drastically, it can cause short sellers to lose money by having to buy back at the higher prices to minimize losses. The silver squeeze is caused by investors buying up silver in an attempt to drive up prices and “squeezing” the investors. Even more exciting is the fact that silver’s logarithmic chart, dating back to the 1960s, reveals a cup-and-handle pattern, indicating the potential for silver to reach several hundred dollars per ounce during this bull market. In order to confirm this particular scenario, silver needs to close decisively above the $50 resistance level.
- This crime is apparently not just for banks anymore, as the conspiracy theorists widen their net to accuse refiners, dealers, and depositories.
- Even gold, often considered the ultimate precious metal, pales in comparison to silver’s diverse applications.
- These “arbitrage trades” tend to hold the two trading centers roughly in balance.
- This is incentivizing the movement of metal into the United States.
- Earlier this week, shares of GameStop (GME) and AMC Entertainment (AMC) surged once again, echoing the frenzy of 2021.
- Conversely, if silver lags behind money supply growth, it suggests a potential period of strength ahead.
If this doesn’t happen, “shorts” will have to pay the difference in price. I expect a breakout in the index is still forthcoming, which will further validate silver’s rally and likely provide additional momentum to its current upward trajectory. The index didn’t break out primarily due to copper’s weakness over the past few weeks.
The idea behind WallStreetSilver is that the precious metal is seriously undervalued due to market manipulation. In the minds of many, though, purchasing large supplies of silver could rectify this. Doing so would drive up demand, limit supply and thus make price manipulation more difficult.
Since 2003, SilverSeek.com has served millions of readers with the latest silver news and information. Although Friday’s trading began like any ordinary day, volume surged in the afternoon as it became evident that silver’s breakout above the $32.50 resistance level had staying power. It’s likely that a good portion of this volume came from traders scrambling to cover their short positions—a a beginners guide to cosmos topic I’ll explore in greater detail later in this article. The heavy trading volume serves as a crucial confirmation of silver’s breakout, signaling that major institutions or ‘smart money’ are getting on board. This significantly reduces the likelihood that this is a false breakout. Basel III could accelerate the efforts of Wall Street Silver, the Reddit group behind the Silver Squeeze.
Recognized by The Times of London, he has built a reputation for warning about economic bubbles and future financial crises. An advocate for free markets and sound money, Colombo was also named one of LinkedIn’s Top Voices in Economy & Finance. When short interest in GameStop rose to 140% of the available shares in January 2021, traders on the “WallStreetBets” Reddit community took note. Thousands piled into the stock igniting a short squeeze, where short sellers were forced to buy shares at higher prices to cover their positions, driving the price up even further. However, this is taking on dramatic, almost biblical proportions and supply shortages are already being experienced around the world.