Why traders are betting on a big bounce for the metals

The metals are getting more precious.

Gold and silver hit multimonth highs Thursday, as industrial metal copper rose to the highest level since the beginning of the year. This as the dollar continued to lose value against other major currencies.

Notably, it is a move that is strongly counter to the trend seen over the past few years, whereby metals prices have fallen mightily as the dollar has soared.

"We're seeing a massive short-covering rally right now, that's all it is," commented David Seaburg, head of equity sales trading at Cowen and Co., in a Thursday "Trading Nation" interview.

Read MoreThe surprising new case for gold

"You're going to have an opportunity here, maybe for the next month or two, to make some money here near term on the upside" for metals, and to the downside for the dollar.

Still, Seaburg warned that given the macroeconomic environment, "it is a structural short still; you lay them back out, they're going to go a lot lower."

However, Larry McDonald of Societe Generale sees the same trade as potentially having more room to run.

It is because the market is starting to price in less tightening from the Federal Reserve that "you're seeing a major reversal in gold miners and commodities," McDonald said Thursday on "Trading Nation." This because the dollar's rise has largely been driven by expectations the Fed would raise rates even as other central banks' policies were still in stimulus mode.

"We're probably in the mid-to-early innings of this game right now," the macro strategist said.

Want to be part of the Trading Nation? If you'd like to call into our live Monday show, email your name, number and question to TradingNation@cnbc.com.

Latest Special Reports

  • A data-driven index of 100 large-cap companies best using technology to invest in and profit from new business opportunities.

  • money transfer technology

    Innovations in payments and financial services are highlighted at Money 20/20, the event where retail, data, and technology intersect.

  • Net/Net promo

    Examining how top companies promote and manage innovation, leverage rapid change and use technology to grow exponentially.

About Trading Nation

  • Trading Nation will offer enthusiast traders insights from a group of "Trader Coaches," a collection of expert CNBC Contributors who are well-versed in the daily challenges of trading. Each "Trader Coach" will have a different area of expertise, and will share their unique perspective on the markets, allowing new insights to emerge from this collaboration. Trading Nation is not simply about finding that next trade; it's a forum where enthusiast traders can hear and compare investing ideas in order to build confidence in their trading decisions.

On-Air Video