Silver is on the verge of a massive short squeeze.  Speculators’ silver-futures shorts surged to extreme bull-record levels less than a month ago.  And they’ve barely started to mean revert, which means big buying to cover is still coming soon.  While speculators’ silver-futures positions are always a great contrarian indicator at extremes, exceptional shorts are the most bullish portent of all.
Unlike new long-side buying, short covering isn’t optional.  Silver futures’ hyper-leverage guarantees that speculators have to quickly buy to cover as silver’s price rises.  This feeds on itself, igniting a buying frenzy as traders rush for the exits.  The bigger their aggregate shorts, the greater the rally their covering sparks.  So the recent bull-record shorts are a super-bullish harbinger for silver and its miners’ stocks.

1 oz Silver Buffalo As Low As $0.84 Over Spot at SDBullion!

NTR Buffalo Round

Submitted by Adam Hamilton, Zeal

Silver is poised for a massive recovery up-leg in 2014, a mean reversion from last year’s dismal action.  The main driver of silver’s initial strength will be American futures speculators covering shorts.  These bearish bets on silver soared to a bull-record high last month, which will require exceptional buying to unwind.  Futures speculators as a herd always bet wrong at major lows, they are a fantastic contrarian indicator.

Because futures trading is such a hyper-leveraged zero-sum game, futures traders have a reputation of being smart and sophisticated.  And they are to a great extent, futures are so unforgiving that survival of the fittest rules.  Capital naturally flows from the poor traders to the good ones.  Nevertheless, within their chests thump the same hopelessly emotional human hearts that are such a liability in the markets.

 

Even good futures traders succumb to groupthink, getting too greedy or too scared with the rest of the herd.  They flood into silver futures after the metal has already surged in strong uplegs, buying into the popular euphoria.  Then they flee silver after it has plunged, waxing bearish with everyone else.  This leads to buying high and selling low, the same emotional affliction that torments nearly every trader.

 

Futures trading is one of the purest forms of speculation, making leveraged up-or-down directional bets on underlying prices.  When these traders buy silver futures, they expect its price to rise imminently so they are effectively bullish on the metal.  When they sell, they expect silver to fall in the near future so they are bearish.  Thus looking at their aggregate bets on silver reveals their collective sentiment on it.

 

Thankfully this useful data is readily available.  All silver futures buying and selling gets distilled into the famous Commitments of Traders reports from the US Commodity Futures Trading Commission.  These weekly reports show how futures speculators as a group are betting on silver.  They’ve always been the most bearish, as evidenced by the most selling, right when silver happens to be carving major bottoms.

 

Futures are a zero-sum game, every contract has a trader on the long side betting a price will rise and an opposing trader on the short side betting that same price will fall.  Every dollar won by one trader is a direct dollar lost by the trader on the other side of that contract.  The total number of longs and shorts in silver futures always nets to zero.  But the classic CoT reports divide traders into three separate groups.

 

They are commonly known as commercial hedgers, large speculators, and small speculators.  Of course the first group actually produces or consumes physical silver for business purposes.  They are simply trying to lock in future prices to better manage their cashflows.  The latter two groups of speculators take the opposing side of those hedging trades, and it is their bets that are a powerful contrarian indicator.

 

This first chart looks at the net-long and net-short positions among these broad categories of traders.  The more net-long silver-futures speculators get, the more bullish they are on silver’s price.  But the opposite extreme is far more interesting today.  The less net-long or even net-short speculators become on silver, the more bearish they are on it.  And in recent weeks that bearishness has approached record extremes.

 

Zeal010314A

 

Recently in early December as silver slumped back towards its brutal June lows, futures speculators’ net-long positions plunged.  The large specs’ net-long futures contracts held fell to just 2.9k.  How low is that?  Between 2009 and 2012 before last year’s epic precious-metals selling anomaly, large specs averaged net-long positions of 28.1k contracts.  A month ago they were merely 1/10th normal levels.

 

Silver’s secular bull was born way back in November 2001 just above $4 per ounce.  Since then there have been 631 weekly CoT reports.  Large specs’ net-long positions have fallen under 3.0k contracts on just 10 of those, or 1.6% of the time.  2 of those weeks were last year, the first in late June.  When futures speculators as a herd get that bearish on silver, the white metal is always on the verge of a major surge.

 

Right after that late-June episode of exceptionally-low speculators’ net-long positions, silver soared by nearly a third in the next couple months.  Right when futures speculators were the most bearish on this metal as evidenced by their low net-long positions, it was bottoming.  They were betting against silver at exactly the wrong time, selling low.  And this certainly wasn’t the first time, specs have always done this.

 

Late June’s large-spec net-long contracts happened to fall to their lowest level in just over a decade, truly anomalous.  But in general spec net-long lows are very bullish silver indicators even when they aren’t as extreme.  A basic rule of thumb is that if spec net longs are near their lowest levels in at least 6 months, they reveal excessive bearishness.  And that has always been a universal contrarian indicator.

 

I highlighted some of these episodes above in blue.  Pretty much without exception, when large futures speculators’ net-bullish bets on silver reach a major low, this metal is also at a major low.  Note above how the large-spec net-long lows coincide with bottomings in silver.  Immediately after these speculators wax the most bearish, silver starts powering higher in either a sharp rally or a much longer major upleg.

 

While there are some very smart silver-futures traders out there, as a herd they succumb to popular greed and fear just like the rest of traders.  They get too bullish after silver has already run too high too fast, and too bearish after silver has already fallen too low too fast.  They trade like momentum players, betting that whatever mature trend is in place will continue indefinitely.  But that really isn’t prudent.

 

Universally in the financial markets, greed and fear dominate short-term price action.  Once greed crests after a long upleg, everyone who is interested in buying in anytime soon has already bought.  That leaves only sellers, so the price soon corrects.  And once fear peaks after a deep correction, everyone who is susceptible to being scared into selling has already sold.  That leaves only buyers, so the price rallies.

 

Excessive greed and fear naturally burn themselves out, spawning all the major trend changes.  These are exceedingly profitable to trade if you can get in fairly early near the inflection points.  Contrarian traders attempt to do this, buying low when everyone else wants to sell then later selling high when everyone else wants to buy.  Being brave when others are afraid is the only way to consistently buy low.

 

But fighting the crowd is never easy, because your own heart will desperately try to convince you to wrongly be excited or scared exactly when everyone else is.  You can short-circuit that desire with context data like silver-futures specs’ net positions that reveals when everyone else is too bullish or bearish.  And with net longs not far above decade-plus lows in recent weeks, specs’ bearishness remains extreme.

 

And provocatively this very bearishness in futures is what drives the initial silver rallies out of net-long lows.  Futures enable traders to easily sell silver short, to effectively borrow silver they don’t own and sell it in the open market.  If the silver price soon falls as these short sellers expect, they can then buy back the silver they originally borrowed at a lower price to pay it back.  Then they pocket the difference as profit.

 

When a price is falling particularly sharply, and fear is exceptionally high, short sellers are often the only buyers around.  Their buying to cover slows the price decline, reverses it, and then accelerates it back to the upside.  The higher the short positions, the larger the necessary buying and the bigger these short-covering rallies become.  And last month total spec silver shorts surged to a record, a super-bullish omen.

 

This next chart slices up the weekly CoT data a bit differently, adding the total long-side and short-side silver contracts that both large and small speculators hold.  Every silver contract sold short has to be bought back before it expires, creating futures buying demand.  And when silver starts rallying in the face of large short positions, the traders have to scramble to cover before their leverage slaughters them.

 

Zeal010314B

 

Just a month ago in early December, the total silver-futures short positions held by both large and small speculators surged to 54.3k contracts.  This is astoundingly high, actually the highest levels ever seen in silver’s entire dozen-plus-year secular bull!  It is also over 2.5x the 2009-to-2012 average levels seen before 2013’s wildly anomalous selling.  And these shorts haven’t come down much in recent weeks.

 

The speculators holding these massive shorts have no choice, they have to buy long-side contracts to offset their shorts and cover them.  And this has to happen before expiration, which is in the next couple months for most of the outstanding contracts.  But if silver starts rallying sharply, these speculators will have to buy very quickly to limit their leveraged losses.  This should ignite a major short-covering rally.

 

Each silver futures contract controls 5000 ounces of silver.  At $20 per ounce, that is worth $100k.  Yet futures speculators are only required to put down an initial margin of $11k to buy a single contract, and the maintenance margin to keep that position is only $10k.  So silver-futures speculators can effectively run 10-to-1 leverage today.  That dwarfs the 2-to-1 legal limit for stock trading that’s been in place since 1974.

 

While futures speculators don’t typically run maximum leverage, they like to get close since that is the main allure of futures trading.  They can win huge gains on their capital risked with relatively small moves in the underlying commodity’s price.  But when that moves against them, the losses snowball just as fast.  And at or near 10x leverage, there is very little room for error in the enormous silver shorts.

 

As all silver investors know, silver has always been an exceptionally-volatile metal.  3%+ price moves in a single trading day aren’t uncommon at all.  For silver speculators shorting at minimum margin (maximum leverage), silver merely rallying 10% wipes out 100% of the capital they risked!  And if silver keeps rallying, which is very likely once momentum shifts in its favor, they can lose far more than they initially bet.

 

And the greater speculators’ total short positions, the greater the risk they all face of a really big and fast rally erupting to wipe them out.  Once again the only way to close these shorts is to buy futures to offset them.  So as soon as a small fraction of speculators start buying to cover, silver’s price starts rising.  That convinces increasingly bigger fractions of the remaining traders to buy to cover, sparking a self-feeding cycle.

 

The more shorts who buy futures to cover, the faster silver’s price rises.  And the faster silver’s price rallies, the more pressure it puts on the remaining short speculators to close their positions.  That is why it is so exceedingly dangerous to be short when everyone else is.  Short covering can quickly become a stampede for the exits, with very few speculators getting out unscathed.  Their frantic buying creates a short squeeze.

 

While some minor short covering happened in December after that secular-bull-record short position of the futures traders, their shorts remain very high.  As of the latest CoT report (Christmas Eve), they still had 45.5k contracts short!  In the 631-CoT-week history of silver’s secular bull, only 16 weeks saw spec shorts over 45k contracts.  Fully 15 of those happened during 2013’s wildly-anomalous silver selloff.

 

After shorting extremes, positions quickly mean revert back to averages.  Between 2009 and 2012 in normal years for silver futures trading before 2013’s anomaly, speculator short positions averaged 21.5k contracts.  That means traders are going to soon have to buy to cover 24.0k merely to mean revert, not even to overshoot as usually happens after extremes.  And that is a lot of silver buying likely to happen quickly!

 

At 5000 ounces per contract, this mean-reversion silver buying from short-side silver-futures speculators alone is 120.2m ounces!  Both the US Geological Survey and the Silver Institute estimate total global mine production in 2012 around 780m ounces.  So the short covering necessary by American futures traders merely to return to recent years’ average levels of shorts is nearly 1/6th of total worldwide production!

 

And because of the risks rapidly-rising prices pose to short sellers’ capital, short covering happens fast.  So once this mean reversion starts, all this silver is very likely to be purchased in the US futures markets alone within a couple months.  You can see how fast speculators’ short positions dropped after past extremes in this chart.  Once short covering starts, it rarely stops until positions fully mean revert or overshoot.

 

Today’s near-record futures shorts are extremely bullish for silver as we dive into 2014.  It is guaranteed near-future buying that feeds on itself.  The early gains in major new silver uplegs are nearly always sparked by short covering, and the bigger the shorts the greater the initial boost.  But futures speculators short silver are certainly not its only buyers.  Their early buying will start enticing investors back into silver.

 

As I explained in an essay a couple weeks ago, silver has many exceptionally-bullish factors going for it in addition to the extreme futures shorting.  It has converged on multiple major secular support zones, a technical launchpad from which past major uplegs were born.  Silver also remains very cheap relative to its primary driver, the price of gold.  Once silver starts rallying decisively, investors will start flocking back.

 

A silver short squeeze will spread like a wildfire in a bone-dry forest.  Despite silver’s miserable 2013, its ages-old allure certainly wasn’t stamped out.  Great latent interest in silver remains among investors and speculators alike.  Though silver plummeted 36% last year thanks to gold’s anomalous selloff dragging it down, the holdings of the flagship SLV silver ETF only fell 1%.  And physical silver demand soared worldwide.

 

So as silver starts rallying again initially on short covering, it will ignite widespread buying from all quarters.  This will feed on itself too.  The more capital that returns to silver, the faster its price will rise.  And the quicker it rallies, the more investors it will attract in.  The gains in silver this year ought to be enormous, well over 50% as I explained a couple weeks ago.  But the silver-stock gains will dwarf those.

 

The stocks of silver miners and explorers were thrashed to within an inch of their lives in last year’s precious-metals carnage.  They’ve never been more undervalued relative to silver even near its recent lows, truly at fundamentally-absurd levels.  So as silver recovers this year, silver stocks are overdue to see gigantic mean-reversion gains.  Most should at least quadruple, with the best flying even higher.

 

At Zeal we’ve been intensely studying silver stocks for over a decade.  Very fortuitously considering the epic silver-stock bargains out there, we recently finished our latest 3-month deep-research project looking into silver stocks.  We started with a universe of nearly 120 of them trading in the US and Canada, and gradually whittled them down to our dozen fundamental favorites.  These winners are awesome.

 

They have been able to thrive operationally even in 2013’s extreme carnage, and will enjoy vast upside leverage as silver recovers.  All dozen are profiled in depth in our fascinating new 27-page silver-stock report recently published.  We are offering these fruits of hundreds of hours of expert world-class research for just $95, a steal.  Buy your report today while silver stocks are still cheap!  That window will rapidly close.

 

We also publish acclaimed weekly and monthly subscription newsletters.  They offer a priceless and rare contrarian perspective cultivated from our decades of hard-won experience, knowledge, wisdom, and ongoing research.  I explain what is going on in the markets, why, and how to trade it with specific stock trades.  2014 will look very different from 2013, so subscribe today and start preparing for big changes!

 

The bottom line is silver is on the verge of a massive short squeeze.  Speculators’ silver-futures shorts surged to extreme bull-record levels less than a month ago.  And they’ve barely started to mean revert, which means big buying to cover is still coming soon.  While speculators’ silver-futures positions are always a great contrarian indicator at extremes, exceptional shorts are the most bullish portent of all.

 

Unlike new long-side buying, short covering isn’t optional.  Silver futures’ hyper-leverage guarantees that speculators have to quickly buy to cover as silver’s price rises.  This feeds on itself, igniting a buying frenzy as traders rush for the exits.  The bigger their aggregate shorts, the greater the rally their covering sparks.  So the recent bull-record shorts are a super-bullish harbinger for silver and its miners’ stocks.

 

Adam Hamilton, CPA

 

January 3, 2014

 

So how can you profit from this information?  We publish an acclaimed monthly newsletter, Zeal Intelligence, that details exactly what we are doing in terms of actual stock and options trading based on all the lessons we have learned in our market research.  Please consider joining us each month for tactical trading details and more in our premium Zeal Intelligence service at … www.zealllc.com/subscribe.htm

 

Questions for Adam?   I would be more than happy to address them through my private consulting business.  Please visit www.zealllc.com/adam.htm for more information.

 

Thoughts, comments, or flames?  Fire away at zelotes@zealllc.com.  Due to my staggering and perpetually increasing e-mail load, I regret that I am not able to respond to comments personally.  I will read all messages though and really appreciate your feedback!

 

Copyright 2000 – 2014 Zeal Research (www.ZealLLC.com)

 

2014 Silver Eagles As Low As $3.29 Over Spot at SDBullion!


  1. This is just a lot of pulp fiction until we are talking about the paper price. It’s the paper price, right? All the short squezze and stuff…. It’s all pointless until some big players as well as people on the street start buying physical. And when they run out of the stuff, all hell will break loose to the upside.
     
    Until then…. pontless, because next week the price will get back down to teens again….

    • @LexLuther well I’m putting my money were my mouth is as I see the paper price heading up also.
      Matter of fact I have an offer of $1100 on these and waiting for a reply. Will see how strong his weak hands are. Lol Keep Stacking
      2 Rolls of 50 Mercury Dimes – $90 each
      1 Roll of 50 Silver Roosevelt Dimes – $75
      1 Roll of 40 Silver Washington Quarters – $175
      2 Rolls of 20 Walking Liberty Halves – $180 each
      1 Roll of 20 Franklin Halves – $150
      1 Roll of 16 Franklin and 4 Kennedy Halves – $150
      1 Half Roll of 10 Morgan Dollars – $225

    • I agree, Lex.  The silver market reminds me somewhat of the oil market in the sense that it is pretty tightly balanced.  Remember the big oil rally a few years back when crude went to almost $150 a barrel?  That entire bidding frenzy was ignited by buyers arguing over the last percentage point of oil that was for sale.  No one wanted to be left out and unable to buy their full quota.  Because of that ALL of the oil out there was bid up way high in price and all for the sake of that last little dribble that the market wanted to buy.  If they had all said, “OK, I can live with 1% less oil this year”, the price would have collapsed.  But that’s not how fear and greed work.  
       
      Similarly, silver prices will remain low until there is genuine fear that buyers who need this metal won’t be able to fill 100% of their orders.  If they can only get 98% of what they want, we’ll see bidding shoot up prices just as we did in the oil market.  It will be bloody but brief and will very likely be an outstanding rally in which to sell a good portion of one’s stack.  If silver were to go to, say, $70 an oz.  a lot of us could sell 1/2 of our stack, buy it back later for cheap, and essentially end up playing this game with the house’s money.  Of course, such an effort would require that silver prices fall and we can buy back those ounces.  While that has always happened in the past, there is no guarantee that it always will.  Still, the odds seem to favor it, barring a SHTF scenario, of course.
       

    •  
      Ah, but you see it`s the new first 2014 short squeeze.  The first of many perhaps this year or at least the first soothsayer notification of a short squeeze for this year.  If they get squeezed too much who knows what may come out of them shorts!
       

  2. Charlie  I have half a mind (on a good day) and thinking about putting an ad in the local rag.
    Silver bought 10% under spot  Cash only–private sales.   Silver bought–call for prices.
    It’s funny about all the precious metal price rigging. I exited the stock market 2 years, clean and sober–to avoid that casino.  After going pretty much all in by early 2013, here we are again, thinking there was some asset safe harbor, proven wrong and at the effect of the same ghouls who play the stock market. This time the leverage is even greater than the stock markets.
    This will end sometime in the near future. Reversion to the mean is a nearly immutable force of nature. While I am confident that silver will go to $100 an ounce something that I state is that silver will probably not rise significantly past $100 an ounce.

    At $100 an ounce silver, the miners will start puking silver afteer ramping up production or opening fallow mines, trying to grab the price rises while they last, avoid sales of their product at a set price, producing not just millions of ounces but potentially billions of ounces. Silver at $100 will produce an insane, frantic buzz and rush, a race to the silver dealers.All those ads on TV will be doubled and doubled again. People will be standing in line 3 deep outside the doors, cash in hand, to buy buy buy. It’ll make the 1981 silver $50 an ounce rush look like a walk in the park. Don’t stand in the way of the last entrants in this rush. You will be trampled. People are far far more desperate today than in 1981. Those were pretty tough times. Our present and coming times will be tougher by a large degree. Fortune favors the observant person in uncertain times.
    Every miner who’s spent nearly 3 years eking out a living, trying to break even and stay alive, will see $50 and $100 an ounce but, like any farming operation– yes, mining is farming the earth (farmers are price takers not price makers) the average Joe will be buying hand over fist in a frenzy to scoop up the last ounce of silver (or gold) produced by the miners until oversupply causes prices to drop rapidly.
    $100 billion in accessible silver (1 billion ounces) will mean the 100,000,000 people in this country with $1000 to buy silver will be desperate to buy something of value. They’ll end up with 10 ounces. Not much of a stack but for some people it will seem like a godsend. It’s in our DNA to know that silver is real money. I chose $100 because it will not make the average Joe insane. Joe will be nervous and anxious to buy some. It’ll make him much more aware of the need to stack. But he will still be fairly rationale, mostly.

    $500 an ounce will cause people to go crazy.
    1 ounce of silver? $500 an ounce? That’s insane.
    At that price we’ll be forced to work within circumstances more grave that trying to figure out what to do with our $500 an ounce silver.
    Bitcoin went to $1,000 from $10 per DIGI-FIAT unit. That aroused some attention but most people were not tuned into that currency. Silver? Yes, everyone know that assets. It’s hardwired into our genome.
    Before you know it, the miners will have caught up with the scurrying rush for precious metals to fill the pockets of the late arrival stackers. They will push more billions of ounces into a market that will become saturated. Average Joe will rush to the game, frantically bidding up the price to $80-100 an ounce, but unlike stackers who have always been very early to the long game, acquiring silver at $20-30 an ounce, Joe will be left holding the $100 ounce bag. This price game will become exhausted once the last dollar is played into an market seriously oversupplied.
    That’s the way this always happens when smart money gets in first and weak or maybe dumb money comes in last. It may not be the worst thing for Joe though, because silver cycles will help mitigate the damage of buying at the tops. And silver is real money; tangible, fungible, long term wealth.
    Remember when Apple was $12 an share? How about $700 an share? What is Apple really worth? Can you eat an IPad?
    Silver will buy highly valued commodities when Apple has seen a 75% drop in value.
    (I just edited Apple price to shares from ounces. That’s how long I’ve been out of the stock trading market)

    When corn, oil, silver, copper, housing, wheat or any other commodity reaches a saturation point, the supply of that item overflows the bunkers, silos and vaults. With silver’s puny market, the price will peak then drop like a rock when the last dollar is invested. Housing took 10 years to peak and 2 years to drop. It was a $30 trillion dollar market in the US.
    Silver might take 10 months to peak and 2 months or less to retrace much of its price increase. It might be a $100 billion market in the US.
    The market will be completely overrun and choked with silver, yielding an inventory that might not bleed off for years. The price rise will be fast; the drop will be fast was well. The traders who fuel this upward rush while be there trading the metal downward. The new short trading profits’ll be seen at every price level.Silver miners will be left with the worst of worlds; a price drop that ends with them dumping into a downward price cascade. The paper trading vultures will make billions in spite of everything.
    There’s nothing wrong with us working with these tides. If they profit; we profit. There’s no sin in that. It’s just good business for the early physical adopters who don’t have billions in capital reserves to play the markets upwards and then exit. Just because someone owns physical does not mean they signed a suicide pact with the market price as it goes down sharply.
    Getting out at that inflection point will be a doozy; the ride heady. Even we stackers will probably do like we did 3 years ago when silver’s rise was a whirlwind. Nearly everyone got sucked in with dreams of becoming silver millionaires based on predictions of $200 silver. The train fell off the tracks with that one.
    One good thing about this 3 year news cycle is that it brought hundreds of thousands of people out of their sleep walking mode, thinking abour precious metals; working to increase their knowledge and being ready for the next stage. Those who bought at $30-40 will be vindicated. That was a lessson well learned and alone may have made the ride thus far worth the price of admission.
    Call it our Phd in PMs. We all learned the hard way.
    The cooler heads, like those well informed people on this site and others, will offer sage advice as to exit timing. The blog rolls will be filled to overflowing with advice. Some of it’ll be worth reading.

    Getting out of silver at a point before the collapse in price will take some doing. On a personal level my plan is to sell maybe 20% of my stack, pay off the mortgage to reduce counterparty risks and have some cash left over. Then trade 35-50% into gold for easier stacking, figure out what else is worth buying or just hold the rest for long term purposes. By the time silver hits $100, the rest of the story will play itself out to our satisfaction.

    Be assured, silver will be much more of a rocket ride since the market is so incredibly small. Demand will be so equally high. You all know how that evolves. Like anything else, the price peak will be reached.  We’ll be happy happy happy. Wariness is a wise policy in times of euphoria. Check your heart at the door as this euphoria is intoxicating; not good for your financial health.
    The price rise will be a Rhino Horn in shape, giving the informed some good indications of when to exit. When the price increase hits about 80 degrees from the horizontal axis, the peak will be reached in short order. It will look a bit like the national debt chart of the last 60 years. Parabolic and then some.
      Maybe moving to gold at that time will be wise since the yellow metal will assume its rightful status as the backer of currency in some countries and in the pockets of the people. Look east. 1,300,000,000 Chinese and 1,250,000,000 Indians can’t be all wrong. 40% of the world’s population senses something is wrong and like all living things that sense the coming storm, they seek higher ground.
    Its little brother will tag along like a faithful companion.
    Real money will work its way into the consciousness of the people.
    Precious metals will assume their rightful status with the people as an asset of real value. 
      Some big investors in the paper paradigm will damaged, maybe beyond repair.
    The owners of physical precious metals will be rewarded.

    These are my speculations.
    I based them on the rise and fall of all commodities, particularly ones like gold, silver and monetary copper with their 6,000 year histories. The move and mania will be breathtaking; almost Tulip Bulb or Bitcoin-like.
    Other than food, nothing else has been around long enough to see the fruits of its changes in values like precious metals. Time and current events are on our side. Those attempting to control the prices are like King Canute telling the tides to stop their progress.
    I may be wrong in some aspects but they are small in nature.
    I am confident that time, tides and human nature will bear fruit for those with the patience to see this through.
    Stay the course.
    You will be rewarded for your wisdom of investing in silver and gold
     

    • Sounds about right to me, AG.  Good calls.  Yeah, don’t sweat the small stuff as there WILL be differences in the details… as always.

  3. :)! Time will come when silver does reach $100.00 OZ. (and maybe beyond that).I agree the price rise will be like a Rhino Horn too. With all that’s going on in theaters other than just silver, please be aware of everything else that’s going on and choose your method of (partial) cashing in if that’s your plan. Yes, we will be happy, happy, happy Stackers. Just please be careful and enjoy.
     
    @ Ranger. Does sound very familiar but, I’d much rather be ready than not. Eyes wide open all the time for all situations. Don’t be caught unaware.
     
    Stack on!

  4. Contestant 
    I’ll take Precious Metals for $1,000 Alex
    Alex T. 
    Number 47 on the Atomic scale, who predicted this precious metal’s price will hit $100 in 2014?
    Contestant. 
    Uh,  Alex, that’s a trick question.  Do you want me to name the DA who predicted this or the name of the metal?
    Alex T.
    Contestant, That’s Dumbass Predictions for 2014  for $1,000, not Precious Metals, dumbass!
    Forfeit $2,000.  ;-)
    Double Jeopardy Question
    The name of the DA and the precious metal’s symbol are the same.
    Keep stackin’
     

  5. This first part is somewhat true: I.e. For each long, there is an equal and opposite short, but short traders are willing to trade contracts to each other based on different time frames of calls and delivery. The author fails to mention these shades of grey, and instead takes a more dichotomistic perspective. Value can be fabricated on the short side by giving preference to certain tumeframes of delivery. This is of utmost importance when discussing manipulation. It seems that value is more easily constructed on the short spread than longs due to fractional reserves.

  6. I’ll give the time frame a WGASA try  time frames are off by one year but over 13 years they jib ok
    2002 to 2008 silver $4 to $16 and ounce   up 300%
    2008 crashed to $8,   down 50%
    2009 to 2011 silver $8 to $50 an ounce   500% increase
    2011 to 2013  silver $50 to $20 and ounce 60% drop
    2013 to 2015 silver from $20 to $100 an ounce, 400% increase
    I took a 2 hour walk after the 100 PM Sunday post
    It seems that for each big drop, the most recent of which in the last decade  were 50%,  once the 50-60% drop comes and goes, like this recent  one which has come and is in the process of leaving  (silver  April-June 2013 time frame from  $18 and back to $24, a 33% rise, down to $18, a 25% drop)  there is a strong probability of silver moving upwards from $20 to the high 2 figures within 2 years
    The $8 to $50, 500% increase took about 2 years roughly.  We’ve been fiddling around with $20 for 8 months.  It’s time to go up, go up by 200-400% and do so by early 2015
    If the fractal and fibonnaci number sequences hold even closely this would lead me to believe there is a large price rise  in the future.
    Manipulated markets are still predicted due to their unpredicability via manipulation   Human nature and the hard math that goes with natural laws and sequences make for some decent consistency
    I also state that I might just be kidding myself.  Normalcy and Confirmation bias in rigged markets do not die or go away. They are there no matter what the reality of the sitution might be.

  7. there are bigger price increases and price drops in shorter time frames.  That might mean the rigging of prices is more out of control that anyone inn charge of this manipulation will let on and more out of control than we can imagine. 
    desperate times make desperate men.

    • this is disturbing  HAARP is something the US gov has admitted to.
      So what goes on when temps are well below zero.
      nothing good for the people, business shuts down,
      people stay home,
      the government continues operations. 
      Frosty the Snowman declares Martial Law? 

  8. I love to see a real truly silver squeeze take place. Not one where the government comes to the rescue to save the day an all is well as they snuff the flame out in a hurry. They snuff the flame out by saying the crimex has no more metal to sell an nobody wants to sell. So they well just lock the price at a certain price an the government well only guarantee by selling it to then at a premium say $35 an ounce. But then there plan starts to burn in hell since the street price of sell starts to take off to the moon. Almost doubling the governments price. As well as over seas the price starts to really rise. And there are people from china japan Germany sending people over here to buy all the silver they can get there hands on to take back to there country. With in a month the price of silver hits close to $100 an most every body wants to sell an only a few hold out for more money believing it will still go higher

  9. Highly respected John Williams of Shadow Stats said today that he believes there will be the beginnings of a dollar crisis this year which will lead to a hyperinflation, in fact in the first half of this year, he said. He was asked how certain he was of this and he said he was 90% certain!(Whoa!) He said that no political jaw boning can stop this inevitable event from occuring, they may stall it but thats about it, it will happen. He said that people should definitely be holding physical gold at this time.
    So holding Silver would be pretty good as well me thinks.
    I’m buying as much as i can right now!
    You can see his interview over on JSMineset, Jim Sinclairs site, maybe the doc will post it here? Very interesting interview.

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