After briefly touching a 12-year high of $35 per ounce early this week, the silver price continued to consolidate. Although the market encountered initial resistance at $34 per ounce, more and more analysts expect this precious metal to still have upside potential.

However, some analysts point out that bullish investors should pay attention to the real bullish factors and be careful not to be misled by false narratives.

Many retail investors, after seeing the 'meme stock' phenomenon in 2021, tried to exert similar short squeeze pressure on the silver market; however, these investors found that the silver market has greater liquidity than stocks like GameStop.

Daniel Ghali, senior commodity strategist at TD Securities, said: "Reports of banks holding huge losses on their short positions in silver are incorrect, but this belief led to over 0.1 billion ounces of silver ETF inflows in 2021."

Analysts indicate that many gold and silver banks are shorting silver not because they want prices to fall, but because they are hedging long positions in other derivative markets.

In his latest report, Ghali reiterated his view that the 'silver squeeze' is real, but not as most investors think. He explained that investors should focus more on physical silver holdings and above-ground stocks. As these resources diminish, prices will have to rise, he added.

"When the supply of physical silver truly becomes tight and the price has not yet reflected this level of tightness, that's when the real basis for a silver squeeze could occur," he said.

Dow Jones Securities is also bullish on silver, because it is expected that the new round of loose policy by the Fed will push down US bond yields and real yields, thereby weakening the dollar.

Dow Jones Securities is also bullish on silver due to the strong industrial demand for this precious metal. This is especially true as silver remains a key metal in the green energy transition.

Dow Jones Securities is not alone in its optimistic outlook. According to a survey conducted during the 2024 Precious Metals Conference of the London Bullion Market Association, representatives expect the price of silver to reach $45 per ounce in the next 12 months.

Despite many believing that the rise in silver has just begun, analysts also urge investors to act cautiously and warn them to expect some volatility.

FxPro's Senior Market Analyst Alex Kuptsikevich stated in a recent report that although he is optimistic about this precious metal, momentum indicators are starting to shift.

He said: "Relative Strength Index（RSIOn the daily chart, rising above 70 indicates that silver may be approaching an 'overheated' area. At the same time, he also believes that weakness in the silver price is a buying opportunity.

He said, "The next potential upside target for silver appears to be in the $35 range, which marks the end of the rebound in 2012 after the sell-off in 2011. However, within the $32 to $35 range, the potential clearing of short-term and medium-term bullish positions could pave the way for long-term buyers to enter clearly. This shift could set the stage for silver to target new historical highs and potentially break the $50 mark."