The price of silver climbs at 8 years; retail traders work on a short push

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(Kitco News) – Silver futures prices are trading sharply higher and hit an eight-year high of $ 30.35 at the start of U.S. trading on Monday. Retail traders, emboldened by social media discussion forums, are working on short market squeeze which means trying to force short term traders in the silver market to capitulate. Gold follows silver higher and is also experiencing some safe haven demand in a recently wobbly US stock market. April gold futures were up $ 17.30 to $ 1,867.40 and March ExCom silver was up $ 2.896 last to $ 29.81 per ounce.

The hallmark of the market to start the trading week and into February is that silver prices hit an eight-year high above $ 30 an ounce today, as retail traders are looking for a “short squeeze” in the market. Social media lit up over the weekend, particularly on Reddit, as the growing group of retail traders sought to destroy another market – this time money – which they say is dominated and manipulated by the “Big” on Wall Street. This follows the GameStop saga that unfolded last week, in which small retail traders put pressure on large hedge funds that had bypassed the struggling company. Money is a much bigger beast to contend with than a smaller individual stock. Still, “Redditors” scared many on Wall Street, especially the big hedge funds that like to sell stocks that they believe will be in trouble now or in the future. While the silver wins are certainly strong, it wasn’t the epic moon price surges that some social media sites were predicting over the weekend. However, the trading week is still young and a lot can still happen. It is important to note that the Gold and Silver markets had a bit of tailwind behind them before the Redditor trade took effect. Many seasoned market watchers already believed that “inflation trading” would stimulate markets for raw materials, including metals, which along with major central banks and governments inject so much liquidity into financial systems in order to revive the major global economies that have been crippled by the Covid-19 pandemic.

Global equity markets were mostly firmer overnight. US stock indexes are pointing to higher openings when the New York daytime session begins, after a lower open in Sunday night trading. The drop in the rate of Covid-19 infections and deaths in the United States is a positive element for the sentiment of traders and investors.

In other overnight news, the euro zone manufacturing purchasing managers’ index (PMI) in January stood at 54.8 from 55.2 in December. A reading above 50.0 suggests growth in the sector.

The main “foreign markets” are now seeing the US dollar index rise. Meanwhile, Nymex crude oil futures prices are higher and are trading around $ 52.65 per barrel. The yield on the benchmark 10-year US Treasury bill is 1.076%.

US economic data due for release on Monday includes the US manufacturing PMI, the ISM manufacturing report, the global manufacturing PMI and construction spending.

Technically, the February gold futures bulls have the slight overall short-term technical advantage amid recent choppy trading. The next bull price target is to produce a February futures close above the strong resistance at $ 1,900.00. Bears’ next short-term price drop target is to push futures prices under strong technical support to the January low of $ 1,804.70. First resistance is seen at last week’s high of $ 1,878.90 and then $ 1,900.00. Early support is seen at the overnight low of $ 1,851.70, followed by last week’s low of $ 1,832.40. Wyckoff Market Rating: 5.5

The March silver futures bulls have the strong overall short-term technical advantage with the big gains of the past three days. The next bullish price target for Silver Bulls is to close prices above strong technical resistance at $ 35.00 an ounce. The next lower price target for the bears is to close the price below strong support at $ 27.77. First resistance is seen at $ 30.00, then at the overnight high of $ 30.35. The next support is seen at $ 29.00 and then at the overnight low of $ 28,155. Wyckoff’s Market Rating: 9.5.