Macro funds are increasing their positions in silver, bringing net length to the highest levels since 2018, with substantial funds still available. Speculative interest has been low but is beginning to rise, with expectations for prices to breach $34-35/oz, potentially attracting more capital.
London’s liquidity is very tight, and even as gold dislocations ease, the US continues to acquire metal globally. Elevated lease rates indicate a shift toward speculative inflows, with prices anticipated to rise as more discretionary traders enter the market in the coming sessions.
Macro Funds And Speculative Interest
The recent positioning of macro funds suggests that capital is flowing into silver at a pace not seen in over half a decade. This is not occurring in isolation—available funds remain high, meaning there are still reserves that could further push net length upwards. Speculative traders, having been cautious for much of the past year, are starting to return, and their involvement often accelerates price action once key levels are approached. Should silver push above $34-35 per ounce, those still sitting on the sidelines may feel compelled to join.
Liquidity constraints in London are not easing materially, even as gold imbalance concerns have started to calm. That said, gold remains in strong demand from the United States, which continues to draw in physical supply from various global markets. This reflects broader structural buying patterns rather than just short-term arbitrage, reinforcing the favourable conditions for precious metals.
Lease rates remain elevated, a direct indication of increased competition for physical silver. This often precedes a wave of discretionary capital entering the market as traders respond to shifting cost structures. If these elevated rates persist, they are likely to force more participants into action rather than waiting on the sidelines.
Market Reactions And Trading Volumes
Over the coming sessions, markets may see rising trading volumes as more participants attempt to position for the next move.
