Last week, another social media trend started on the Reddit forum r / wallstreetbets, which aims to initiate a major short squeeze of silver to push the price of the precious metal towards $ 1,000 an ounce. However, the silver squeeze trend is accompanied by controversy as numerous wallstreet bets supporters believe hedge funds such as Melvin Capital and Citadel are behind the silver push.
The controversial ‘Silver Squeeze’
Last week is news.Bitcoin.com reported about the wallstreetbets (WSB) saga that takes place on social media forums and the infamous subreddit r / wallstreetbets. Since the mega short squeeze on Gamestop (GME) stocks, the squeeze maneuver has also spilled over to a number of other stocks. This week there were stocks from the Russell 3000 Index (RUA) targeted including tickers such as NOK, GOGO, AMCX and FIZZ. But the trend didn’t stop there, as one post in particular had called for a ‘silver squeeze’. The WSB Reddit post called for the silver squeeze to increase the price of silver from $ 25 an ounce to $ 1,000.
Now that the post has been published, the Reddit admins responsible for moderating r / wallstreetbets have removed the post. But that was long after the message was made viral by the participants discussing the pros and cons of an attempt to press silver. The reason people think the silver short squeeze post might be seedy is because a number of WSB Redditors think the silver squeeze was invoked by the hedge funds who lost money to cover their GME losses. There are a large number of Reddit posts warning that people should not participate in the silver short squeeze.
A message said:
Citadel is the 5th largest owner of it [silver], it is imperative that we do not ‘squeeze’ it. These are hedge fund bots that spam prices.
The people who don’t like the silver trend at WSB have also warned that Melvin Capital Management is also a big silver holder. Unfortunately, it is difficult to say where the threads and posts of the silver pump come from, as there are many free market supporters who are fans of the precious metal known as the ‘poor man’s gold’.
Despite this, there are a number of WSB fans and Redditors who claim that the silver pump comes from hedge fund folks and they believe there are cheaters everywhere now. Some of these people get irrational and get mad at anyone who posts about silver. Many WSB supporters may feel the pain of Gamestop Corp. stock. which fell by -100% on Monday.
– Holger Zschaepitz (@Schuldensuehner) February 1, 2021
Despite the controversy, something is increasing the demand for silver
Despite the speculation, some sort of question was raised when it came to silver prices and obtaining physical precious metal. For example, if you’re trying to buy an ounce or ounce of silver online, the process is much more complicated now than it was last week. Much of the bars and coins have been sold out or prices are being raised significantly.
This is simple arbitration. #Silver futures are 28.67. Silver Eagles on Apmex are $ 41.66, which is a 45% futures premium. Obvious possibility to buy futures and stand for delivery for 35% off physical entitlement? But if they don’t have it, Futures = $ 41.66 / oz. #silversqueeze
– Jonathan #SILVERSQUEEZE Mergott (@ Jmergz1985) February 1, 2021
All American Eagles are sold out at a number of precious metal dealers. On Sunday morning, some major dealers stopped a large number of silver sales. News.Bitcoin.com’s most recent WSB report revealed how SD Bullion sold nearly 10x the number of silver ounces than usual. People visiting precious metal dealer websites such as Provident, Apmex and JD Bullion can see the unprecedented demand for physical silver.
“Over the past week we have seen a dramatic shift in the demand for silver from our customers,” said Ken Lewis CEO of precious metals trader Apmex. “For example, the number of ounces sold per day was about twice earlier in the week and closer to four times the average demand by the end of the week,” added Lewis.
Apmex’s CEO further emphasized:
Once the markets closed on Friday, we saw demand hit as many as six times per working day and more than 12 times per normal weekend day. Combined with the extremely high demand, we are also seeing an increase in new customers. On Saturday alone we added as many new customers as usual in a week.
Additionally, the hashtag “#silversqueeze” has been popular in the United States and some other countries on Twitter for the past 48 hours. By late afternoon on Sunday, spot silver and futures traded at $ 27 a Troy ounce, and on Monday morning, spot silver was trading 7.7% higher at $ 29.76. The commodity jumped above the $ 30 region, and the silver price per ounce switched hands at $ 30.35 an ounce. An ounce of .999 silver floats in the $ 29 price point at time of publication
What do you think of the controversial silver squeeze? Let us know what you think about this topic in the comments below.
Image Credits: Shutterstock, Pixabay, Wiki Commons
Disclaimer: This article is for informational purposes only. It is not a direct offer or invitation to an offer to buy or sell, or a recommendation or endorsement of products, services, or companies. Bitcoin.com does not provide investment, tax, legal or accounting advice. Neither the company nor the author is responsible, directly or indirectly, for any damage or loss caused or alleged to be caused by or in connection with the use of or reliance on any content, goods or services mentioned in this article.