silver - last night action

  1. 678 Posts.
    The precious metal market action today was superb. Both gold and silver opened very strongly and went up from there to close on their highs of the Comex trading session. Both made news highs right near the close, a positive for tomorrow. Naturally, the $6 rule was enforced in the gold pits by the corrupt and increasingly impotent looking Gold Cartel. The high for gold was $5.80 up on the day.

    Both gold and silver made 15-year highs. The highest previous gold close was in late January at $426 and change.

    It appears gold and silver are going to take out $430 and $8 respectively. When they do, the volatility should pick up noticeably. After $430, gold has no real technical resistance for a long ways up. We will start hearing talk about $500 gold when $430 is taken out and it might happen in short order. It is important to keep in mind what we know and few others are paying any attention to because they are clueless. And that is there is a massive gold short position out there. More than 16,000 tonnes of gold is owed to the central banks. Some of it may be paid back in cash settlements. But, certainly not most of it. The shorts cannot cover their positions in a major way in a market with a 125 tonne monthly supply/demand deficit without driving the price sharply higher. Then, you have the potential of the gold derivatives neutron bomb going off which could come at any time. At some point we ought to start hearing more about gold producer hedge book problems too.

    When it comes to silver, forget about it. The shorts are in deep doo-doo. There is no way they can cover without the price accelerating even more than gold will because THERE IS NOT ENOUGH PHYSICAL SILVER OUT THERE for them to get the job done except from silver scrap. And that will take a price spike to ferret out and will take a middling amount of time. The Silver Streak is going to be a sight to behold!

    The gold open interest only rose 970 contracts to 295,044 on yesterday’s rally. This suggests some shorts are beginning to run for the hills.

    The silver open interest gained 721 contracts to 119,147. To me this is good from a technical point of view. The price is going up steadily without the specs pouring in. Another sign that silver has become a PHYSICAL market.

    April Gold
    http://futures.tradingcharts.com/chart/GD/44

    May silver
    http://futures.tradingcharts.com/chart/SV/54JUST IN LATE from another extremely well-connected and highly regarded Café source who is very knowledgeable about the precious metals, someone who loaded the boat years ago with gold/silver physical and the shares. A month ago he bought 500,000 ounces of silver and did not have much of a problem doing so and with immediate delivery assured. This afternoon he was told the maximum order he could place is 100,000 ounces and he would have to wait a few days.

    It gets better. Turns out he learned the bullion dealers are sneaking around with armored cars making deliveries. They are trying to give the perception everything is normal in the silver world. IT IS NOT!
 
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