Silver prices have seen a resurgence against Gold this month, following a period of underperformance. According to TDS macro analyst Daniel Ghali, this uptick is likely due to improving commodity demand sentiment and increased activity from both CTAs and macro funds. While this indicates positive momentum for Silver, there is the potential for a round of large-scale CTA selling activity which could impact the ‘catch-up’ trade in the short term. Despite this, Silver’s fundamentals are still on an upward trajectory, with only minor obstacles in the way of its continued growth.
One of the main factors contributing to Silver’s recent performance is the increasing demand for commodities, supported by both CTA buying activity and macro funds re-engaging in the market. This has helped Silver regain some ground against Gold, which has been outpacing it in recent months. However, there is a concern that a significant round of CTA selling could put pressure on the ‘catch-up’ trade, potentially leading to a decline in Silver prices. Despite this possibility, the overall outlook for Silver remains positive, with its fundamentals continuing to show improvement.
It is important to note that Silver’s fundamentals have been steadily improving throughout the year, with only a few minor issues impacting its growth. The #silversqueeze thesis, which gained traction earlier in the year, has seen some setbacks but overall, Silver’s performance has been strong. The recent increase in commodity demand sentiment and the activity from CTAs and macro funds indicate that there is still room for growth in the Silver market, despite potential challenges in the near future.
As Silver continues to show positive momentum, investors are advised to keep an eye on potential CTA selling activity that could impact the market. While Silver has made strides in catching up to Gold in recent weeks, there is still the possibility of a setback if large-scale selling occurs. However, the overall outlook for Silver remains bullish, with its fundamentals pointing towards continued growth. Investors should remain cautious but optimistic about the white metal’s performance in the coming months.
In conclusion, Silver has seen a resurgence in recent weeks against Gold, driven by improving commodity demand sentiment and increased activity from CTAs and macro funds. While there is concern about potential large-scale CTA selling activity impacting the market, Silver’s fundamentals remain strong and continue to show improvement. Investors should monitor the market closely and be prepared for any potential setbacks, but the overall outlook for Silver remains positive. With ongoing support from both institutional and retail investors, Silver looks set to continue its upward trajectory in the near future.
