According to Kitco, a report showed that money-managed speculative gross long positions in Comex silver futures rose by 736 contracts to 41,545. However, short positions also rose by 1,922 contracts to 42,404.
Silver now has a net short position of 859 contracts. For the sixth week in a row, net bullish positioning has decreased. Since early June 2019, the silver market has been a net negative for the first time.
The silver market is struggling, according to analysts, since sluggish demand for base metals has a negative influence on its industrial interest.
According to some experts, copper prices must stabilize before silver can find a bottom. As hedge funds closed their hefty copper short bets, this situation might be on the cards shortly.
(Picture 1. Source: Bloomberg and Sprott Asset Management LP. Data as of 4/30/2022.)
Although risk aversion is prevalent in the current climate, it is not the fundamental driver of longer-term silver demand, given its dual character as a precious and industrial metal.
The energy transformation narrative will potentially be a significant driver of silver demand this year and in the future. Both the epidemic and the war in Ukraine have increased investment in energy-transition projects. The current environment’s geopolitical difficulties only bolster that tendency while weakening other aspects of silver demand.
*Red lines are downtrend. The heavy red line is the long-term trendline.
*Green lines are uptrend. The heavy green line is a long-term trendline.
*Blue lines are short term support & resistance lines
(Picture 2. Trendlines & Support/Resistance)
You can check more interactive graphs from our Tradingview account.
(Picture 3. – Garterly pattern, moving averages, and RSI)
In conclusion, there are “mixed feelings” in the market, and one must keep an eye on price action and near-coming support areas to make educated price speculation.
Disclaimer: This article is for informational purposes only and is not intended as an investment analysis or recommendation to sell or buy commodities. Tavex is not responsible for any decisions made based on this information. Investing is associated with opportunities and risks, and the market value of commodities can both increase and decrease. Past or future yields on the commodities and financial ratios shown above do not represent a promise or an indication of future earnings