Last week, another social media trend started on the Reddit r / wallstreetbets forum, which aims to start a big silver squeeze to push the price of the precious metal to $ 1,000 an ounce. However, the silver squeeze trend comes with controversy, as several advocates of wallstreetbets believe that hedge funds like Melvin Capital and Citadel are behind the silver push.
The controversial ‘Silver Squeeze’
Over the past week, news.Bitcoin.com reported on the wallstreetbets (WSB) saga taking place on social media forums and the infamous subreddit r / wallstreetbets. Since the mega short squeeze in Gamestop (GME) shares, the squeeze maneuver has also spread to a number of other actions. This week, the Russell 3000 Index (RUA) shares were targeted, including quotes such as NOK, GOGO, AMCX and FIZZ. But the trend did not stop there, as one post, in particular, called for a “silver squeeze”. The WSB post on Reddit asked the price of silver to push the price of silver from $ 25 to $ 1,000.
Now that the post has been published, Reddit administrators charged with moderating r / wallstreetbets have removed the post. But that was long after the message went viral by the participants discussing the pros and cons of trying to squeeze silver. Now, the reason people think that the short-term position of silver may be doubtful is because several WSB redditors believe that the money reduction was invoked by hedge funds that lost money to cover their losses at the GME. There are a large number of posts on Reddit warning that people should not participate in squeeze short silver.
One post said:
Citadel is the fifth largest owner of [silver], it is imperative that you do not “tighten” it. These are spamming awards from hedge fund bots.
People who don’t like the silver trend on the WSB have also warned that Melvin Capital Management is also a big silver holder. Unfortunately, it is difficult to say where the silver bomb wires and posts come from, as there are many free market advocates who are fans of the precious metal, sometimes referred to as the ‘poor man’s gold’.
Despite this, there are many WSB fans and Redditors claiming that the silver bomb came from hedge fund personnel and they believe that there are imposters everywhere now. Some of these people are becoming irrational, getting angry at anyone who posts on silver. Many WSB supporters may be feeling the pain of Gamestop Corp’s actions. dropping significantly on Monday.
Silver surpasses $ 30 a troy ounce with the shopping frenzy fueled by Reddit for the third day. #Silversqueeze pic.twitter.com/mLmasUBrq1
– Holger Zschaepitz (@Schuldensuehner) February 1, 2021
Despite the controversy, something is driving demand for silver
Despite speculation, some kind of demand has been invoked when it comes to silver prices and obtaining physical gold. For example, if you are trying to buy ounces or ounces of silver bars online, the process is much more complicated now than it was last week. A large part of the bars and coins are sold out or prices have increased considerably.
This is a simple arbitration. #Silver futures are 28.67. The Silver Eagles at Apmex cost $ 41.66, which represents a 45% premium over futures. Obvious opportunity to buy futures and stay for delivery with a 35% discount on physical duty? But when they don’t, Futures = $ 41.66 / ounce. #silversqueeze
– Jonathan #SILVERSQUEEZE Mergott (@ Jmergz1985) February 1, 2021
All American Eagles are sold out at a number of gold dealers. On Sunday morning, some renowned dealers suspended large numbers of silver sales. News.Bitcoin.com’s most recent WSB report revealed how SD Bullion sold almost 10 times the number of ounces of silver than normal. People who visit websites of gold dealers like Provident, Apmex and JD Bullion can see unprecedented demand for physical silver.
“In the past week, we’ve seen a dramatic shift in silver demand from our customers,” said Ken Lewis CEO of gold dealer Apmex. “For example, the proportion of ounces sold per day was running about twice at the beginning of the week and close to four times the average demand at the end of the week,” added Lewis.
The CEO of Apmex also emphasized:
As soon as the markets closed on Friday, we saw demand reach up to six times on a normal business day and more than 12 times on a normal weekend day. Combined with extremely high demand levels, we are also seeing an increase in the number of new customers. On Saturday alone, we add as many new customers as we normally add in a week.
In addition, the hashtag “#silversqueeze” has been a trend in the United States and in some other countries on Twitter for the past 48 hours. Late Sunday afternoon, spot silver and futures were traded at $ 27 per ounce Troy, and on Monday morning spot silver was traded 7.7% higher at $ 29.76. The commodity jumped above the $ 30 region, and silver prices per ounce changed hands at $ 30.35 an ounce. An ounce of .999 silver is hovering in the $ 29 price range at the time of publication
What do you think of the controversial silver grip? Let us know what you think about this in the comments section below.
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