- Silver is now down nearly 1.5% this week.
- Retailers fail to force a GameStop-like short squeeze in silver.
Silver is trading near $26.64 at press time, representing a nearly 1% decline on the day.
The metal rallied 20% between last Thursday and early Monday, hitting an eight-year high of $30.03 as coordinated buying effort organized through social media platforms triggered fears of a short squeeze (price rally due to unwinding of short positions) and translated into a surge in physical demand.
However, the short squeeze remained elusive, with hedge funds holding a net long position. Prices fell by over 8% to $26.69 on Tuesday and have struggled to bounce back ever since.
The Chicago Mercantile Exchange’s decision to raise the margin required to trade silver curbed animal spirits in the silver market.
The probability of silver seeing a GameStop-like crowd buying-led short squeeze was always low given the size of the metal’s market is over $1 trillion – significantly higher than GameStop’s market cap.
Technical levels
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