The war ignited by US retail investors and Wall Street bears around the “game station” of US stocks is still burning wildly, and now it is still “silver”.
Recently, on the Wall Street bets forum in the United States, a retail investor with the user name of “jjalj30” called on everyone to focus on silver for the next round of air force.
“Jjalj30” said that the silver market is currently one of the most manipulated markets in the world, with dozens of banks manipulating gold and silver prices to cover up real inflation. Whether in industry or money, the current easing of global central banks should push up the price of silver. After adjusting for inflation, the price of silver should be $1000 / oz, instead of about $25 / oz. “Jjalj30” believes that retail investors can push up the price of silver by continuously buying silver ETF (SLV).
According to some analysts, there is another reason why American retail investors choose silver. Precious metals are the global market, and American securities companies can’t cut off the Internet and delete the stock code like the “game station” for American stocks.
Money is also pouring into the silver market. According to the latest data, on January 29, the silver position of iShares silver trust, the world’s largest silver ETF, increased by 1070.56 tons compared with the previous day, with a single day inflow of US $1 billion, setting a single day’s highest inflow record.
In this context, global silver related asset prices have been pushed up
On February 1, the opening price of spot silver in London jumped more than 7% and then expanded to 10%, once standing at $30 / oz, a new high since February 2013! In the domestic futures market, Huyin’s main contract rose by more than 9%, exceeding 5900 yuan / kg.
Under the crazy market, on the afternoon of the 1st, the Thai Futures Exchange announced the suspension of trading of silver online futures.
On the afternoon of January 1, China Construction Bank announced on its official website that recently, the price fluctuation of precious metals in the international market has intensified and the market risk has increased. Please enhance the awareness of risk prevention, strengthen the management of precious metal trading business position and margin of account (including two-way trading) and personal agency of Shanghai gold exchange, reasonably control the position and make rational investment.
On the 1st, silver related stocks also rose sharply, and many Chinese investors also made big profits. Hong Kong shares of China Baiyin group surged 62% to close at HK $1.35, with a total market value of HK $2.2 billion. In the A-share market, many stocks, such as Baiyin Nonferrous Metals, Yuguang Gold lead and Yintai gold, staged a trading limit.
In addition, U.S. stocks of gold, precious metals and mining surged before the first day of trading, with kordalen mining and hekra mining up more than 20%, SSR mining up 13%, ginrose gold up 5%, Barrick gold up 3.6%, gold mining up 55.6%, silvercrest and McEwen mining up 27%.
Fund manager: professionalism is not like that of retail investors
According to China first finance and economics, at the Wall Street bets forum, the reason why investors regard silver as the latest target is very simple and direct – the price of silver is seriously out of line with the real value, and the price is seriously manipulated. In fact, this so-called “manipulation” has long been a common phenomenon for investors, because not only silver, but also the monetary property of gold has long been ignored by the investment community. Now gold and silver only have the property of assets, and their prices are mainly affected by the real interest rate.
A number of Wall Street fund managers said that retail investors may also be just “cannon fodder”, behind which are the strength of other institutions, especially the professionalism of tactics and strategies, which are not like what retail investors do. The reason why these retail investors choose silver instead of gold is that the market volume of silver is much smaller than that of gold, just like small market value stocks such as game stations, which are easier to control with less capital.
According to the Shanghai Securities News, the main contents of the call Post on the Wall Street bets forum are as follows (you can feel the professional degree of the post sender)
The first part of the call post is to call for short squeeze. “In the silver futures market, the ratio of Book Trading silver to physical silver fluctuates between 100:1 and 500:1, with an average of 250:1. This means that for every 250 ounces of open positions in the futures market, only one ounce of physical silver has actually been delivered We can make the big bears who control the price of silver suffer. At present, several big investment banks are mainly naked selling blank silver through the futures market, making them pay a high price for their over leveraged naked short selling Looking at the fine JPMorgan has paid for manipulating silver prices over the years, it’s time for them to pay some price for decades of manipulating silver prices. ”
In the part of what to buy, the call Post wrote: “I will invest in silver ETF stocks and silver ETF options. The increase of silver ETF positions will lead to silver price rise. When silver ETF approaches $35, there will be short squeeze. If there is a short run, the target price of silver ETF will reach $75 at the end of April. A more prudent approach is to buy Silver ETF options and silver ETF shares. ”
Industry insiders: it’s almost impossible for silver price to rise to $1000
Can silver really rise to $1000 under the frenzy of retail investors in the United States?
Peter Hu, head of global trading at kitco metals, believes it is almost impossible for silver to eventually push up to $1000 an ounce. He explained that although retail investors on reddit are trying to make blank silver, it is obviously more difficult to make blank silver than the game station. He said that the major participants in silver trading are the world’s large banks, and the trading of precious metals such as silver mainly depends on the supply and demand fundamentals. Although there is a slight shortage of investment products targeting silver in the market, there is no shortage of physical silver in the market.
He also said that in the medium and long term, the current market fundamentals are still favorable for silver prices. Although silver prices have risen recently, silver prices are still undervalued.
According to China first financial, Goldman Sachs has recently been strongly bullish. “Silver is still our preferred precious metal. Silver has outperformed gold in the past three months as global industrial output has recovered. ”
However, Goldman Sachs also mentioned the risk of investing in silver, “if the gold price does not rise, it will be difficult for the silver price to rebound, and the gold price is still the main driving factor for the silver price. Although both silver and copper have industrial uses, different from copper, silver has a higher level of above ground inventory and a greater price elasticity. This means that silver is unlikely to have tight supply driven by the growth of industrial demand. ”
Frequent voice of US regulators
According to CCTV news, US President Biden’s senior economic adviser said in an interview with the media on January 31 local time that Biden’s government will investigate the legal issues of last week’s “game station” roller coaster stock trading. Brian Deese, chairman of the National Economic Commission, said in an interview with NBC news that the Commission is committed to fully understanding what happened, focusing on protecting retail investors and fair trading, and identifying and tracing potential violations.
On January 29 local time, the US Securities and Exchange Commission (SEC) issued a statement, saying that the SEC is closely monitoring and evaluating the extreme volatility of some stock trading prices in the past few days, and warning against illegal “trading manipulation”.
“Our core market infrastructure has proven resilient under the pressure of abnormal trading volumes,” the statement said. However, extreme stock price volatility may cause investors to suffer rapid and serious losses and undermine market confidence. ”
The SEC said it would continue to protect investors and maintain a fair, orderly and effective market. “If there is evidence of abuse or manipulation of trading prohibited by federal securities laws, we will take action to protect retail investors.”
The statement also said that at present, the securities and Exchange Commission is working closely with regulatory partners, including the U.S. financial industry regulatory authority, other regulators and stock exchanges, to ensure that regulated entities fulfill their responsibility to protect investors and to identify and trace potential illegal acts.