Price action in the silver market has been brutal. A week ago, the metal was struggling to stay above the $31 mark. Since last Friday, silver has been fighting to recover from price slashing that has taken it to increasingly low levels, preventing a single close above or even at the $30 level.
One major decline came as silver headed into the weekend. Even as gold was overcome with pressure early Friday, silver bulls put up a fight that initially helped support the white metal. However, by the day's end, the battle was lost and March silver touched its lowest level since January 4. Silver on the New York market was chopped down to a closing price of $29.80, posting losses of $0.60.
The Commitment of Traders report for the week ended February 12 reveals that net speculative length dropped 664 metric tons (MT), the largest decline this year. Part of the drop resulted from nearly 380 MT lost as longs unwound their positions for the second week in a row. On the opposite side of trade, shorts added 285 MT, the largest addition seen since July 2012.The underlying moves show a market that is particularly keen to get out of silver, Standard Bank said. On Monday, silver saw some short covering and bargain hunting, and with that initial bounce, silver prices were seen around $30 intraday. To maintain that level, silver needed something to seize upon, but this supportive development was not forthcoming and prices declined, paving the way for further weakness. COMEX March silver hit a six-month low on Tuesday. On the spot market, the metal lost $0.54 for the day and closed at $29.44.