Silver Futures Shoot Up 5% As WallStreetBets Seeks Short Squeeze

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Silver futures jumped on Sunday night as speculation arose that the Reddit investors-led short-squeeze rally that pushed up shares in GameStop Corporation (NYSE:GME) and others is extending into the precious metals market.

What Happened: March silver futures traded 5.34% higher at $28.37 at press time. The futures shot up 8% shortly after the opening of the market at one point. 

Spot silver traded 4.61% higher at $28.23 at press-time. 

A post on r/WallStreetBets targeted large banks like JPMorgan Chase & Co (NYSE:JPM) and Goldman Sachs Group Inc (NYSE:GS) in relation to the “Silver Squeeze.”

“The Silver squeeze will bring down the biggest banks in the world. That’s why Robinhood barred trading of $SLV the day after they took a billion dollars in loans from JPM and Goldman Sachs,” the post said. 

Silver-related stocks closed higher on Friday. The iShares Silver Trust (NYSE:SLV) closed Friday’s trading 1.09% higher at $24.99.

First Majestic Silver Corp (NYSE:AG) closed 7.47% higher at $18.12 and gained 1.6% in the after-hours session. 

Fortuna Silver Mines Inc (NYSE:FSM) ended the regular session on Friday 2.1% higher at $7.78 and gained 3.21% in the after-hours trading.

Why It Matters: The silver short squeeze gained momentum over the weekend and the effect was evident on social media. 

See Also: How WallStreetBets Is Fueling A Rally In Silver Stocks

Both the Winklevoss twins tweeted on the topic on Sunday. 

Strong demand for silver forced bullion dealers from taking orders, reported Kitco’s media division. 

Peter Hug, the global trading director for Kitco Metals, said that there was ample supply of larger silver investment products but the pandemic had created a shortage of smaller coins and bars.

The renewed demand is putting pressure on the physical market, as per Hug.

https://markets.businessinsider.com/news/stocks/silver-futures-shoot-up-5-as-wallstreetbets-seeks-short-squeeze-1030024143

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