Silver: A break north of $34-35 to attract more capital inflows – TDS
|
Macro funds are (finally) waking up to the silversqueeze you can buy into, TDS' Senior Commodity Strategist Daniel Ghali notes.
London liquidity remains severely constrained
"Our advanced positioning analytics point to a continued rise in Silver positioning from macro funds last week, lifting their net length towards its highest levels since 2018 with substantial dry-powder still remaining. Speculative interest in Silver has been the missing link for the performance of flat prices, and growing interest over the last two weeks suggests that a break north of $34-35/oz will attract more capital inflows."
"This is consistent with the timing for a countdown towards a silversqueeze, with historical precedents and academic research corroborating our view for additional upside convexity over the coming months. London liquidity remains severely constrained, even as dislocations have subsided in gold, as the US continues to pull in metal from the world."
"Lease rates remain extremely elevated and even though physical demand remains limited, speculative inflows are finally starting to appear. In most scenarios for prices, we still expect a drift higher in CTA positioning over the coming sessions, but the fireworks will come from additional discretionary trader inflows."
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers.
