- Silver has surged sharply in thin Friday trading, driven by a strong short squeeze and a breakout to new highs.
- Despite the powerful rally, volatility remains extreme, making cautious position sizing and protection against sudden reversals essential.
As you can see, Silver has shot straight up in the air as the market is likely to continue to see more of a short squeeze going on. And really, at this point in time, we're somewhat in no man's land. I am the first to admit that I do not like Silver in general because it is a market that can cause an immense amount of destruction. But we have shot straight up in the air and are up about 5% as we get close to the end of the futures trading session on Friday, which obviously would be very low volume. So, I think at this point in time, we have reaffirmed the idea of breaking out to the upside. And again, while I don't like silver as a general rule, this is a market that's clearly one that you cannot get short of.
Short Squeeze Pressure and Extreme Risk
In fact, if you have shorted this market recently and didn't get out, you probably are absolutely liquidated, and your account is probably empty. At this point in time, we'll try to find a place to get to. I don't know what our destination is because there's no real way to evaluate places we've never been.
Top Regulated Brokers
I suspect that there will be a little bit of support near the $55 level, perhaps extending down to the $54 level. But at this point, silver has just rocketed to the upside. And I think you have to look at each dip as a potential opportunity. The volume again is pretty anemic and has been shrinking for a while. So I don't trust this as much as gold, but clearly, there's only one way you can trade it. Trade it with a reasonable size and make sure that you protect yourself on any vicious pullback. On Monday, we could see a 4% drop, which would still be a net gain, but most people who are trading silver, if they lose 4% in a day, are losing and bleeding. Massive amounts of money have been my experience. So, caution is a better part of valor here.
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