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PRECIOUS METALS – Silver rises slightly, despite euphoria from retail investors declines

Silver prices were attempting a rally on Wednesday, after falling more than 8% in the previous session, which stalled a wave of social media-inspired buying that began last week.

* Spot silver was up 0.6% at $ 26.76 an ounce at 0937 GMT, after rising as much as 2.1%.

* Prices rose to $ 30.03 on Monday, their highest level since February 2013, after retail investors turned their attention to silver in an attempt to replicate the rally in GameStop shares.

* “The trigger for the reversal was the rise in margins by the CME Group (…) that underscores that this rise was driven by short-term speculators in the futures market and not by long-term investors in the market. physical, “said Julius Baer analyst Carsten Menke. “Another reason silver struggled is that gold failed to rise.”

* Silver tumbled more than 8% on Tuesday after CME Group raised silver futures holding margins by 17.9% on Monday to address market volatility.

* The wave of retail investor buying that began Thursday left silver traders looking for supplies for retail buyers, while 1 billion ounces of silver were traded in London on Monday.

* “Silver prices are now finding an equilibrium that better reflects supply and demand fundamentals as the WallStreetBets craze has waned,” said FXTM market analyst Han Tan.

* Analysts expect some volatility to continue despite posts on WallStreetBets, the Reddit forum that fueled the retail frenzy, urging traders to stay away from silver.

* Among other precious metals, spot gold fell 0.1% to $ 1,836.36 an ounce and US gold futures were up 0.2% to $ 1,836.50, while platinum was stable at $ 1,093.96 and palladium was down 0.6% at $ 2,229.24.

Ben Oakley
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