FxWirePro Call Review: Maintain short positions in Silver; enter fresh short at rallies with new extended target

In April, we warned that silver price is likely to move lower, and later that month we forecasted a $14 final target largely due to the

• The ongoing strength of the U.S. economy and strong USD,
• Lackluster demand from the investment sector, and
• The Commitment of Traders (CoT) report that suggested bearish bias in silver. The long positions in silver declined more than 11,000 contracts in the week ending April 16th, which pushed the net long positions to just +5.9K contracts, the lowest level since November.

Since then there have been some changes in the fundamental,

• The economic strength has softened to some extent and the USD weakened leading to the current rally in Silver.
• Investment demand has still been low, with commercial demand set to decline as an effect of trade tensions between the U.S. and China.
• Moreover, the commitment of traders (CoT) report suggests that the net position has shifted. Speculators are now net short -22.4K contracts in silver, supporting bearish outlook.

Trade idea:

• Silver has reached many of the targets, we expect the rest to get reached.
• Reached targets -  $14.6, $14.48, and $14.3
• Yet to be reached - $14 and $13
• We recommend selling in the current rally.