Silver Markets Have Wild Ride

Silver markets initially tried to rally during the trading session on Thursday but found a bit of a brick wall near the $25.50 level, an area that has been a major barrier. By forming the candlestick that we have, it does suggest that perhaps we have quite a bit of noise that is going to continue to offer resistance. You can see that it has offered resistance previously, so that of course will be something worth paying attention to as well. Because of this, the market looks as if it is starting to run out of momentum, and quite frankly the daily candlestick just screams “J.P. Morgan lives here.”

SILVER Video 25.02.22

If you do not know what I am talking about, JP Morgan has been fined by the authorities multiple times for manipulating the metals markets, particularly silver. The type of massive selloff that we have seen in this area does suggest that perhaps there was a lot of block orders entered into the market, because J.P. Morgan inherited massive silver shorts after the Great Financial Crisis, which they still have to unwind. They inherited the silver shorts from one of the banks that they swallowed up in part of the restructuring.

That being said, the US dollar spiking certainly does not help, and at this point in time if you are trying to play the “fear trade” in the metals market, you are getting a strong lesson in the fact that silver is an industrial metal just as much as it is a precious metal. Because of this, I still favor gold over silver, especially after this horrific candlestick.

For a look at all of today’s economic events, check out our economic calendar.