NEW YORK (Scrap Register): Mitsubishi sees potential for silver to bounce as traders with short, or bearish, positions buy in order to cover them.
Gross short silver positioning by speculative investors reached an all-time high of 411 million ounces last week, and in the last four weeks gross shorts, increased by 166 million, or 68%, Mitsubishi pointed out.
Silver weakened into Monday, before starting to right itself again. The near-term direction in silver is now likely to be upwards as investors cover their short positions.
Overall, however, analysts point out that speculators remain net long, or bullish, in the silver market.