Home › News › Forex › Market News › Daily market commentary: After GameStop, Reddit investors tried to replicate this success by targeting silver
Daily market commentary: After GameStop, Reddit investors tried to replicate this success by targeting silver
This Tuesday morning the safe haven US dollar is retreating versus other major currencies, such as the euro and the pound, as optimism appears to be returning. Investors appear encouraged by the developments in Washington late on Monday, with Democrat lawmakers rallying around President Biden’s $1.9 trillion stimulus plan, increasing the chances of it passing in the Senate. The fizzling-out of fears that last week’s rebellion by Reddit retail traders could cause long-term disruption to financial markets is also supporting risk appetite.
Silver is not GameStop. That is the first lesson of the last few trading hours. After successfully pushing up Dogecoin and GameStop, Reddit investors (and probably not only them) tried to replicate this success by targeting silver. But this is a much bigger whale, with a huge number of players involved. Moreover, silver is the sum of an array of markets: physical (jewellery, industrial, investment, central banks’ reserves) and financial (ETFs, futures, options and many other derivatives as certificates, CFDs etc.).
After the initial skyrocketing of the price, silver has since lost 5% with the price dropping back below $28. In this case, the fundamental drivers are holding – at least for the time being – against the irrationality of markets. Of course, things could change, but the resistance level of $30 touched yesterday and last summer seems to represent a significant barrier for further rallies of the precious metal.
Carlo Alberto De Casa – Chief analyst, ActivTrades
EUROPEAN SHARES
European markets opened higher on Tuesday, following the bullish tone on both Asian markets and US futures overnight. Market sentiment turned positive this week, helped by resurging stimulus hopes and expanding vaccination plans which offset volatility fears triggered by the dramatic retail speculation on some stocks. All European benchmarks are trading higher this morning, driven by tech shares and reassuring macro data from France and Italy while most investors wait for results from Amazon, Alphabet, Alibaba and Pfizer later today. While the current lower market volatility will reassure mid to long-term investors, it will remain the main focus over the next few trading sessions, with tomorrow’s EU CPI report and Friday’s US NFP release crucial points to assess the mood of markets.
Pierre Veyret– Technical analyst, ActivTrades
Disclaimer: opinions are personal to the authors and do not reflect the opinions of LeapRate. This is not a trading advice.
Experienced writer and journalist, working in the global online trading sector, Steffy is the Editor of LeapRate. She has previous experience as a copywriter and has been with the company since January 2020. Steffy has a British and American Studies degree from St. Kliment Ochridski University in Sofia.
