What you see on the chart on this past Friday into Sunday/Monday has all the markings of a classic commercial short covering price raid but that is the subject of next week’s report after the numbers come out… That $16 handle came and went quickly, did it not? It is still time to BUY, BUY, BUY physical silver with every fiat cash dollar you have.
Plan on holding 1.5 – 2 years into the biggest wave up you will have ever witnessed in any lifetime!
Submitted by Marshall Swing:
Another week goes by and the same old story? Not quite, but close. What happened this COT Week is the speculators started to blink or at least they are showing who they truly are and that is honest players in the manipulation game. Perhaps they are greedy and out to make super profits but they appear to go about it honestly, at any rate. We don’t see government and commercial banks accusing precious metal speculators of manipulating gold and silver prices the way we saw speculation blamed for the rise in oil to almost $150 a barrel in 2008. What happened this week was telling, to say the least.
In silver, speculators grabbed up about 5,324 short positions or over 26 Million ounces of the white stuff in the form of shorts. BUT, they also doubted and took almost 4,000 longs! The silver week is almost a wash. Meanwhile, back at the commercial ranch, those swap dealers were doing the long stocking stuffing with over 2,000 of those and we see -881 short coverings by the producer merchant and that may be the fast dip at the end of the period. But notice those small specs as they loosed only -66 shorts and took 824 longs. The appetite for speculator short positions may be slowing down and curiously enough, just today we see price take a turn upwards over the last two days as far as $1 North only to come back down to rest around $17.20.
There appears to be no great interest yet in the commercials driving price far North to trap speculator shorts but also no desire to drive it into the $16s and $15s. Notice the speculator spreading and a lot was taken off the table as the reality sets in price could shoot far upwards and quickly, and without warning. The silver chart bears little resemblance to the gold chart. In gold, price was far more volatile and we see the commercials cover just over 6,800 shorts and the disaggregated COT shows the swap dealer cashing in on almost 7,700 of those puppies to the tune of almost 38.5 Million ounces steep into the money, huge profits!
I will not speculate how much into the money but you have to realize those shorts could have been taken at $20 and much higher and now price is around $17… That’s more than I made all of last year! And the year before, and the year before…. Okay, that is more than I have made in my lifetime but who’s counting?
Okay, that’s more profit than most companies make in a year but who’s counting? You get the idea… The commercials are counting! Very curiously, however, the combination of the producer merchant and the swap dealer selling about 4,800 longs during the same COT Week is very interesting, mathematically, to say the very least. As a general rule, they buy longs low and sell high and I have documented many times as they buy longs at a high price and hold onto them far lower then let them go to crash price.
Same commercials, many different methods available to them when they do not have to worry much about losses knowing they will recoup them in an HFT raid up or down. They can play price just like a puppet on strings. Just look at that gold chart and imagine those commercials driving price up and down and up and down and up and down and down and up and down. That is what I have marked in the chart.
I am quite certain they use the lows to buy longs (taking advantage of the speculators taking shorts) drive the price up, sell the longs, drive it down, buy some more, repeat, rinse, start again. It is a volatility game they played this past COT Week and played it very well they did, indeed.
Now, what you see on the chart on this past Friday into Sunday/Monday has all the markings of a classic commercial short covering price raid but that is the subject of next week’s report after the numbers come out… That $16 handle came and went quickly, did it not?
It is still time to BUY, BUY, BUY physical silver with every fiat cash dollar you have. Plan on holding 1.5 – 2 years into the biggest wave up you will have ever witnessed in any lifetime!
Reporting from the wilderness of Southern Illinois, stay thirsty for physical, my friends,