AIRLINK 62.48 Increased By ▲ 2.05 (3.39%)
BOP 5.36 Increased By ▲ 0.01 (0.19%)
CNERGY 4.58 Decreased By ▼ -0.02 (-0.43%)
DFML 15.50 Increased By ▲ 0.66 (4.45%)
DGKC 66.40 Increased By ▲ 1.60 (2.47%)
FCCL 17.59 Increased By ▲ 0.73 (4.33%)
FFBL 27.70 Increased By ▲ 2.95 (11.92%)
FFL 9.27 Increased By ▲ 0.21 (2.32%)
GGL 10.06 Increased By ▲ 0.10 (1%)
HBL 105.70 Increased By ▲ 1.49 (1.43%)
HUBC 122.30 Increased By ▲ 4.78 (4.07%)
HUMNL 6.60 Increased By ▲ 0.06 (0.92%)
KEL 4.50 Decreased By ▼ -0.05 (-1.1%)
KOSM 4.48 Decreased By ▼ -0.09 (-1.97%)
MLCF 36.20 Increased By ▲ 0.79 (2.23%)
OGDC 122.92 Increased By ▲ 0.53 (0.43%)
PAEL 23.00 Increased By ▲ 1.09 (4.97%)
PIAA 29.34 Increased By ▲ 2.05 (7.51%)
PIBTL 5.80 Decreased By ▼ -0.14 (-2.36%)
PPL 107.50 Increased By ▲ 0.13 (0.12%)
PRL 27.25 Increased By ▲ 0.74 (2.79%)
PTC 18.07 Increased By ▲ 1.97 (12.24%)
SEARL 53.00 Decreased By ▼ -0.63 (-1.17%)
SNGP 63.21 Increased By ▲ 2.01 (3.28%)
SSGC 10.80 Increased By ▲ 0.05 (0.47%)
TELE 9.20 Increased By ▲ 0.71 (8.36%)
TPLP 11.44 Increased By ▲ 0.86 (8.13%)
TRG 70.86 Increased By ▲ 0.95 (1.36%)
UNITY 23.62 Increased By ▲ 0.11 (0.47%)
WTL 1.28 No Change ▼ 0.00 (0%)
BR100 6,941 Increased By 63.6 (0.92%)
BR30 22,802 Increased By 233 (1.03%)
KSE100 67,142 Increased By 594.3 (0.89%)
KSE30 22,090 Increased By 175.1 (0.8%)
Markets

Silver drops from 8-year peak as stellar rally loses steam

  • "It's just wild market behaviour with a low level of predictability. So, even fundamentals and technicals almost go out of the window," Rodda said.
Published February 2, 2021

Silver prices dropped nearly 2% on Tuesday, as investors locked in profits after the precious metal touched a near eight-year peak in the previous session.

Spot silver slipped 1.5% to $28.54 an ounce by 0257 GMT, after jumping 7.3% to hit its highest since February 2013 at $30.03 on Monday, as retail investors piled into the market following calls on social media in an attempt to push prices up.

The Chicago Mercantile Exchange's steps to increase margins on silver trading, and discourage the highly speculative behaviour in the market has prompted some profit taking, said IG Market analyst Kyle Rodda.

CME Group Inc on Monday raised Comex 5000 Silver Futures margins by 17.9% to $16,500 per contract from $14,000 for February.

Margins are deposits mandated by exchanges to mitigate default risks while investors trade in futures markets and they are typically raised at times of price volatility.

The retail frenzy that started last week has left dealers from the United States to Singapore scrambling for bars and coins to meet demand, while also prompting the US Commodity Futures Trading Commission to closely monitor the market.

The fact that silver moved up without similar spikes in other precious and industrial metals, "suggests that it's an outlier of sorts and therefore vulnerable to come down quite strongly", said ED&F Man Capital Markets analyst Edward Meir, adding, it hasn't, however, topped out just yet.

Despite the lack of fundamentals for prices to move up, experts say the retail interest can continue to push the market higher in the near term.

"It's just wild market behaviour with a low level of predictability. So, even fundamentals and technicals almost go out of the window," Rodda said.

Spot gold was steady at $1,860.36 per ounce. U.S. gold futures shed 0.1% to $1,861.90.

Platinum declined 1% at $1,115.86, while palladium added 0.4% to $2,254.98.

Comments

Comments are closed.