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发帖数: 2136 | 1 SYDNEY (Dow Jones)--Spot silver suffered one of its most severe drops on
record early Monday, as bulls who have driven the gray metal up to 31-year
records failed to carry it above $48 a troy ounce and were routed in a
headlong collapse.
The metal fell 12% in just 11 minutes when the fall was at its most severe.
Spot silver saw its informal 2200 GMT open at $47.863/oz before rising to a
peak of $48.150/oz around 2205 GMT, then sold off sharply after 2225 GMT to
a base of $42.210 before stabilizing.
The move down is the first break in an extraordinary run for silver, which
has more than doubled in price over the past six months as investors bet on
rising prices from renewed industrial demand and as a cheap safe-haven
alternative to gold.
From a low of $8.453/oz in October 2008 silver first doubled to $17.960/oz
last August before more than doubling again to a peak last Monday of $49.831
/oz.
Jonathan Barratt, director of Commodity Broking Services in Sydney, said the
sell-off repudiated bulls who were suspected of driving the price up to
sell their own positions at a profit.
"It looked like a market play. Both the precious metals opened up very well
bid, and I think people decided that some people who wanted to see silver go
higher were the ones buying it up," he said.
Silver suffered years of weakness from the 1990s as one of the main demand
drivers for the metal--photographic film--went into decline with the rise of
digital photography. Some analysts have begun to argue that industrial
demand for the metal could now rise significantly thanks to new uses of
silver in photovoltaic solar panels, but the most recent spike in prices is
put down more to the general rush for safe-haven assets at a time of
uncertainty in the global economy.
Silver's rise has come as gold, whose price rose dramatically during 2010,
has come towards a top, leading some analysts to argue that investors saw
better potential in a metal which had previously failed to match gold's
performance. The metal has also been the centre of arguments that Wall
Street banks had been suppressing the price of silver through short-selling,
and that the current price rise was caused by the same banks buying large
volumes of silver to escape a so-called "short squeeze".
The U.S. Commodity Futures Trading Commission has long rejected such claims,
but an investigation of the claims was launched in 2008 and last October
commission Bart Chilton said in a statement that there had been "repeated
attempts to influence prices in the silver markets".
Spot gold dropped less dramatically Monday but still saw a relatively savage
sell-off, losing 2.2% in just over half an hour from a peak of $1,576.52/oz
at 2223 GMT to $1,542.61/oz at 2304 GMT. Precious metals such as gold and
silver rarely move more than 1% over the course of a day.
Barratt said the move was helped by a thin market. Asian trade is normally
the quietest part of the trading day for precious metals, although the first
hour of trade tends to be busier, and activity is expected to be relatively
muted Monday as the loco London settlement system is closed for the U.K.'s
May Day public holiday.
Last Monday, also a public holiday in the U.K., saw spot silver's drive up
to its 31-year record of $49.831/oz in similarly thin conditions.
Nonetheless, trade of the metal on the Comex exchange was relatively heavy
for Asian hours. Front-month silver futures typically see volumes of around
1,000-2,000 contracts exchanged per hour at the start of Asian trade, but 11
,492 lots were traded in the hour from 2200 GMT Monday--still well below the
market's daily peak early in the European afternoon, when 15,000-30,000
contracts are traded on a typical day.
Barratt said the strength of the most recent shift, coupled with signs of
improving sentiment around the Middle East, would encourage participants to
find justifications for the new lower price level.
"You've had the technical move now and people will start to backfill that
with fundamentals," he said. |
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