NEW YORK (Scrap Register): Silver may get a further boost, in part on short covering, as the metal rises with gold amid geopolitical worries, said Mitsubishi.
Silver came under heavy selling pressure late last week after the unexpectedly strong U.S. nonfarm payrolls reading for July, Mitsubishi added.
“Renewed geopolitical concerns centering on North Korea have seen silver make strong gains today, despite a rising dollar, and we expect further gains are possible beyond the early August high of $16.94,.” said analysts at Mitsubishi.
Analysts pointed out that the most recent positioning data show a cut in gross short, or bearish, silver positions. There is still considerable scope for further short covering from here – since the gross short book remains at an elevated 79% of the all-time high at 380Moz (million ounces) -- which should be price supportive in the near term.