WallStreetSilver and the Silver Squeeze: What You Need to Know

Press coverage has mostly fizzled, and somehow it seems like nothing is happening. Given that silver prices took out the $30 price level earlier today, the next major psychological resistance is $35 and $40. The Motley Fool UK has no position in any of the shares mentioned. Views expressed on the companies mentioned in this article are those of the writer and therefore may differ from the official recommendations we make in our subscription services such as Share Advisor, Hidden Winners and Pro. Here at The Motley Fool we believe that considering a diverse range of insights makes us better investors. Should you invest, the value of your investment may rise or fall and your capital is at risk.

  1. 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.
  2. For some reason, though, talk of a silver squeeze hasn’t subsided.
  3. For instance, GameStop’s market cap was $1.4 billion in mid-January, but this increased 16 times over when Reddit traders started to talk up the stock.

Founded in 1993 by brothers Tom and David Gardner, The Motley Fool helps millions of people attain financial freedom through our website, podcasts, books, newspaper column, radio show and premium investing services. They believe that by buying and holding GameStop, they can force the price higher, and force GameStop short-sellers to buy back the shares at ever-higher prices. The candlestick chart below highlights the gap up in the price of the fund with an almost immediate retracement bringing prices back to where they were before the massive inflows. The surge in volume is circled in red, while the average true range (ATR) indicator – which depicts an average of daily price movement – also peaked.

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 metatrader 5 mac any way. Without much doubt, the Reddit Revolution will fundamentally change the way stocks are shorted throughout the market-at-large and shift the dynamics that have traditionally existed with respect to the retail trading community.

Live Spot Gold

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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. Ultimately, it was believed that these rebellious activities amongst retail investors would lead to the “biggest short squeeze in the world” and that these events would eventually send the market value of SLV above $1,000. To understand the silver squeeze, you first need to know the meaning of a short squeeze. Short-sellers borrow shares of stocks that they expect to drop in price. Then they sell the stock and attempt to buy it back at a much lower price. Bunker foresaw at least a tenfold increase in the price of silver as a result of the plummeting real value of the dollar, so he and his brother began to buy up physical silver as well as future contracts.

The stock market gets most of the media’s attention because it’s easier to grasp than its cousin, the commodities market. That said, the commodities market has as many spectacular stories to tell as the stock market. For example, Japanese trader Yasuo Hamanaka, aka “Mr. Copper,” caught the world’s attention in the 1990s when his daring (and brilliant) attempt to manipulate the copper market came to light. It is there in the Comex chapter 7 terms so that if a seller fails to deliver then the Comex is not liable to deliver metal but will pay in cash instead. Start buying futures, the massive amount of paper shorts will be exposed and this all melts up.

Live Spot Silver

The forward-thinking approach extends beyond immediate exploration goals. Khunkhun reveals the company’s intention to explore potential mergers and acquisitions. By actively seeking opportunities for consolidation or partnerships, Dolly Varden Silver Corp. aims to strategically https://bigbostrade.com/ position itself within the mining industry, leveraging synergies and growth prospects. Jesse is now a popular and controversial financial media personality with over 200,000 social media followers and nearly 10 million views per month on all platforms.

Silver squeeze explained

One look at Google Trends, though, shows that silver overshadowed the yellow metal for an entire week. The paper silver markets, including some miners like First Majestic Silver (AG), have been getting hammered. There’s every reason for miners to keep rallying, and even the physical-backed ETF, PSLV. 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 recorded two consecutive weeks of gains on Friday, following two back-to-back weeks of losses.

Hero Bullion provides an environment that is informative and safe for those looking to own physical gold and silver bullion as an investment. We love helping folks at all stages throughout their bullion journey making progress towards acheiving their financial goals. Whether you are a seasoned bullion investor or brand new to the game of gold and silver bullion ownership, we’re here to help and serve you in any way we can. Believe it or not, the silver short squeeze has already been attempted and it did have a slight effect on the pricing of silver.

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. In the end, their investments in futures contracts were their undoing. 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.

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. We have taken reasonable steps to ensure that any information provided by The Motley Fool Ltd, is accurate at the time of publishing. The content provided has not taken into account the particular circumstances of any specific individual or group of individuals and does not constitute personal advice or a personal recommendation. No content should be relied upon as constituting personal advice or a personal recommendation, when making your decisions. If you require any personal advice or recommendations, please speak to an independent qualified financial adviser.

That whole false narrative that the GME squeeze would crater the market was ridiculous. If the 8 major banks that are crazy short the paper silver futures get cracked, that will top the market. This would likely create a ‘run’ on gold depositories and bullion banks. A short squeeze would then be in effect and the price of gold would jump. WallStreetSilver is right about short selling having a major effect on the price of any asset.

Silver squeeze is real

However, reddit traders need to understand that the silver market is much more liquid than individual stocks like GameStop
, AMC and Blackberry, which caused real pain for some prominent hedge funds last week. Basel III could accelerate the efforts of Wall Street Silver, the Reddit group behind the Silver Squeeze. The Silver Squeeze is a concerted effort by these investors to stop the big bullion banks’ silver market manipulation.

The entire annual global supply of silver is enough to produce 39 million Electric Vehicles per annum. However, Hamanaka was only building on a ploy pioneered by the Hunt brothers 20 years earlier. Let’s take a trip through one of the largest speculative attempts to corner a market—and how it went awry.

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