2024年3月17日 星期日

India Creating Short Squeeze In The Silver Market, And Look At Gold…

kingworldnews.com

The price of silver has surged $3 in the past 12 trading days because India is creating a short squeeze in the silver market.  This is a demand driven situation that threatens to send the price of silver soaring in the short-term.  And take a look at what is happening with gold…

Silver Stars
March 15 (
King World News
) – 
Alasdair Macleod:  After a powerful up-move last week, this week gold had a minor correction. Silver’s upward momentum continued through to Wednesday before it ticked off the top. In European trade this morning gold traded at $2168, down $11, and silver at $25.05, up 65 cents.

India Creating Short Squeeze In The Silver Market
They key to this activity is India. The Indian government introduced a solar production linked incentive scheme. Reliance Industries, among others, are investing heavily in photovoltaic production, and is commissioning the first 5 giga-watt phase of a 20 GW manufacturing facility scheduled for opening this month. I am informed by industry sources that being unable to source sufficient silver from refiners, Reliance has been buying what it can in silver markets, including Comex. It is almost certainly Reliance which is taking the bulk of that 1,201 tonnes and the acceleration of deliveries this month reflects the commissioning of Phase 1 in Jamnagar. 

Shorts Losing Their Grip On Silver
It seems extraordinary that with the massive increase in global ESG-related demand that the silver price has not yet risen significantly. But as I explained in a post to my Substack subscribers this week, China has deliberately suppressed the silver price while importing significant quantities to bolster its photovoltaic production. Now that India is rapidly developing its output under government schemes, China is likely to lose its grip on price. 

From the breakout, which is near current levels, pattern analysis suggests a move out reflects the move in, giving a price objective of $40.

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