There's a big rush to get out of May silver and buy july-GERO
"There's a big rush to get out of May silver (futures contract) and buy July. That's what's happening, and with silver, there's a lot of short covering going on," said Gero. Investors in May contracts are on notice they must take or make delivery of the metal.
"Certainly, what I can say is the silver market remains supported by the fact that it's illiquid, relative to gold. We haven't seen a great decline in industrial demand, and that's because it's pretty inelastic. If you're going to make a cell phone, you need a little silver," said James Steel, chief commodities strategist with HSBC.
Silver has also been hot because some investors saw it as a cheap proxy for gold, and an inflation play. Fed Chairman Ben Bernanke described an environment where the Fed would be accommodative and keep rates low for some time. He also gave a nod to rising inflation
"There's a lot of short-covering going on, consternation about the dollar and continued worries about the euro zone and Middle East," said George Gero of RBC Wealth Management.