Monday, April 25, 2011

What a ride!!! (Updated)

If you were up last night, Silver took you on an incredible ride.

Action on the overnight GLOBEX was nothing short of astonishing.  At it's high point last night Silver had soared an amazing $3.18/ounce to hit $49.79.

Profit taking brought Silver down a few notches but by the time the action closed for the night the gains were stunning.

With the London markets closed today, Silver took a break before the action started in New York.

I spoke with a work colleague who had purchased his first physical silver just last week (and was looking at gains of 20% for the week) and warned him that today would be highly volatile... both to the upside and to the downside.

The markets didn't disappoint.

In a desperate attempt to cool the market, the CME hiked margin requirements again. Initial and maintenance margins were hiked by about 9%, the third such hike in as many months.

Just like in the previous two months, Silver suffered a big sell-off just before the announcement as the Cartel clearly gave notice to those closely connected. 

So when the markets opened in New York, silver was clawed back to a low of $47.80 in the morning and has been pounded lower throughout the day. We've seen this countless times since August. Many analysts predict Silver to drop down again tonight and tomorrow and possibly even drop near $45.50 or $45. 

IF that happens, look for aggressive buying and a move $50 or even $52 by late next week.

Before long swings of $5.00 a day will occur regularly and this may well become your coffee mug of choice...


COMEX analyst Harvey Organ has come out with his analysis for the day.

As expected, Organ is reviewing the day's trading numbers which confirms the New York trading day was rocked by massive volume orchestrated by the bankers.

  • "The total OI on Thursday night was 144,301 and today it was reported that the OI rose quite dramatically to 149,899 for a gain of 5598 contracts. That is absolutely humongous as the JPMorgue dug their heels and heroically supplied the massive non backed paper with reckless abandon....The next data was unbelievable: the estimated volume at the silver comex today was 279,844. No doubt we had some switches but that volume was unbelievable. "
Remember each of these contracts represents 5,000 ounces of silver. So a volume of 279,944 contracts in a day represents  1,399,720,000 ounces of silver traded today.

In analysing the Commitment of Traders Report Organ notes:

  • "What have we learned? In silver: the bankers are not covering yet which is a big surprise as they are still adding to their short position. The large specs continue to pile it on hoping for the end game to be played out. The game is between the large specs vs the commercial bankers. The large specs have enormous amounts of dollars to play long. The bankers have enormous amounts of lent dollars from the Fed placed for collateral against billions of paper losses. Without a doubt there will be an epic battle on this front."

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  1. Any tips on getting my hands on some physical silver? I am going to call the bank tomorrow and ask if they sell silver Maple Leafs...I live in Yellowknife so don't have access to civilization! Google searches on buying silver don't seem to be much help. Thanks for the blog...the work you put in is amazing.

  2. Scotia Bank sells precious metals online and they are one of the bigger buyers on the COMEX. They regularly have silver maple leaf coins. You can also go into the branch on 50 Ave and order in person.