Gold and silver futures were falling sharply on Tuesday, with the fall in prices for a gold metal sister coming as CME Group lifted margin investment requirements for trades after dense gains in the precious metal and industry .
Cash future for March SI00 delivery,
SIH21,
they traded $ 1.96, or 6.7%, lower to $ 27.45 an ounce, after jumping 9.3% to mark around the highest settlement for most active contract since around 2013.
The recession follows what some retailers and commodity strategists have said as a result of a short-lived effort, pointing out individual investors who have also been blamed for raising values in shares of GameStop Corp GME,
and AMC Entertainment Holdings AMC,
in the last few weeks.
On Monday, Acting Futures Trading Commission Chairman Rostin Behnam said the CFTC is “closely monitoring recent activity in the money markets. ”
That statement was followed by CME Group announcing that they were increasing margin requirements to $ 16,500 per contract from a $ 14,000, 18% hike, effective Feb. 2.
“The short-lived effort in the money market seems to have failed, at least at this stage,” said Jim Wyckoff, senior analyst at Kitco.com.
“The next goal of upside prices is to close prices above this week’s high technical strength of $ 30.35 an ounce,” the Kitco analysts wrote. “The next target is to bring down prices for bears to close prices under strong support at $ 26,” he said.
Prices for cash have accumulated in the last few days and it comes as a post on Reddit last week referring to a brief pressure on the metal in a similar way to those helped raise GameStop and AMC prices and put on several hedge funds.
Read: Silver gets GameStop treatment, rallies up to 13%
However, the $ 1.5 trillion money market is seen as a much tougher target for individual investors gathering on sites like WallStreetBets and Discord.
Check out: Silver stocks list NYSE’s largest coin list
At the same time, gold prices were falling significantly lower.
GC00 gold April,
GCJ21,
fell $ 30.40, or 1.6%, to trade at $ 1,833.50 an ounce, after a 0.7% gain for the start of this week.
Gold prices are trading below both the 50-day moving average at $ 1,858.26 and the 200-day MA at $ 1,852.81 an ounce, FactSet data show.
Moving averages are used by technical analysts to help measure bullish and bearish short-term and long-term movements in assets.