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(Kitco News) Reddit’s silver short squeeze move was mainly focused on buying up the physical inventory. Still, the rally is spilling over into miners as a new wave of investors begin to look to the lagging silver market.
On Monday, silver rose to its eight-year high of $ 30.35 an ounce. In March, Comex silver futures last traded at $ 29.10, up 8.12% one day.
The largest silver ETF (SLV) Friday also saw the largest single-day inflows in history, totaling nearly $ 1 billion.
All the attention even led to #silvershortsqueeze being trending on Twitter overnight.
“Growing interest from the Reddit sub-forum caused prices to briefly rise north of $ 30 / oz for the first time since 2013. shorted and illiquid stocks – the motives clouded by the bullishness of hedge funds and banks – the effort can certainly keep prices and volatility high in the short term, ”TD Securities strategists said Monday.
The retail frenzy even overwhelmed online sellers of silver coins and bars, SP Angel analyst John Meyer said. “Over the weekend, online sellers of silver coins and bars around the world sold out,” said Meyer.
Analysts have warned investors that chasing the silver market can be dangerous, adding that the short squeeze in silver will be a lot harder to achieve than in stocks like GameStop (NYSE: GME).
“Silver differs in significant ways from US retailers such as GameStock, where many funds are bullish on precious metals, and Bloomberg reports that money managers have had a net long position in the metal since mid-2019,” said Meyer. “Analysts also question the retail industry’s ability to squeeze the silver market, currently worth $ 48 billion in London vaults alone, compared to GameStock’s market cap of $ 1.4 billion in mid-January.”
Even the WallStreetBets (WSB) subreddit seems split on the topic, with many users saying the silver short squeeze call is a distraction from the original GME game. The subreddit even snatched the popular “THE BIGGEST SHORT SQUEEZE IN THE WORLD $ SLV Silver $ 25 to $ 1000” post, which seemed to trigger all of this silver talk last week.
Also, posts like “stop buying SLV” have made it to the top of the discussion board with 34.9K upvotes. One of the main concerns of the WSB is that Citadel Advisors LLC, which gave money to Melvin Capital during the GameStop short squeeze, is also a major holder of SLV and could benefit from the precious metal’s rally.
But despite these debates, the silver price wasn’t the only one to make huge gains on Monday, as silver miners also rallied. Here’s a rundown of some of the top meetings with silver miners starting Monday.
Pan American Silver Corp (TSX: PAAS.TO) was up 9.84% and traded at $ 45.44.
Fresnillo Plc (LON: FRES) rose 8.58% and traded at $ 14.94.
First Majestic Silver (NYSE: AG) rose 21.58% on the day and traded at $ 22.03.
Hecla Mining Company (NYSE: HL) rose 24.96% on the day and traded at $ 7.11.
Wheaton Precious Metals (NYSE: WPM) rose 5.16% and traded at $ 43.19.
Endeavor Silver Corp (NYSE: EXK) rose 19.39% on the day and traded at $ 5.91.
Fortuna Silver Mines (NYSE: FSM) rose 14.65% on the day and traded at $ 8.92.
MAG Silver Corp (AMEX: MAG) rose 10.33% on the day and traded at $ 21.69.
Avino Silver & Gold (AMEX: ASM) rose 53.63% on the day and traded at $ 1.8896.
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