On to the business of protecting your wealth…
Lets face it – a short squeeze in inevitable – Nearly everyone in the East hates silver and gold and is/was massively short. They got thier way, silver dropped some 60% from the high – But let me remind you… what goes up must come down and what goes down must come back up.
Looks like a nice short covering rally over the past 2 trading days (and into overnight Asian trading) and if this rally continues into the east today, it could be “look out above!”
While virtually everyone in the US is saying silver is going to zero, the Asian markets are adding a 1 and a 0 to that number.
As I posted last week, (with charts) this appears to be 2010 & 2011 lining up again. I believe that the remainder of this month will be choppy trading, but as we get into the last week of August and the first week of September, we can expect the gains to hold and the silver and gold seasonals start to take control.
I was out and about shopping this weekend and I was reminded about the Muslim Holy Month. I saw a few people with tattoo’s on the palm of their hands and had to ask… Then they reminded me of the cultural aspect of their holiday and how silver and gold make up a large part of this holiday.
I think its pretty fair to say that you and I expect a rally. There had been way to much selling in gold & silver for no reason, but now it offers an amazing buying opportunity. If you are not sure if this is “your time”, than I would suggest cost averaging some of your ounces – The last thing you want to have happen is to let a short covering rally be the reason for you missing out at silver around $20…. oops! I mean $21
Think of it as a surprise party… I’d rather be early than be one minute late when they all yell “surprise”!
Have a great week ahead!
Allow me to assist you in understanding these ever changing and challenging financial markets and more importantly, how you can profit on the upside potential and protect yourself from the downside risks….
Now, onto the breaking news that matters…
Silver Short Squeeze – The bottom line is speculators’ short positions in silver futures recently soared to record highs. This group of traders has a long history of hitting peak bearishness when silver hits deep lows just as major new uplegs are being born. Their bets are a powerful contrarian indicator. And the only way they can exit their gargantuan silver short position is by buying a proportionally massive amount of silver futures.
This guaranteed buying will drive silver higher, putting great pressure on all the short speculators. They will have to buy to cover, forcing silver higher and igniting a vicious circle. A mere mean reversion of their total short and long positions to post-stock-panic norms would necessitate near-future buying equivalent to over a fifth of total global production! That is great fodder to fuel an epic short squeeze.
Incredibly Important Developments In Gold & Silver Markets– You got a pop (in silver), and it took it up through the $20 level. It basically closed right near $20.50, so it is at the extreme top of a trading range. We are just about out of the range trade that’s contained that now for almost all of July and the first week here in August.
So if this thing (silver) can hold its gains, and this is a big if, because this is what I want to see personally to prove to me that this metal wants to move higher, but if this can hold above $20 now, I think you are going to see some serious short covering begin in silver among the weaker-handed shorts.
That’s what I think would be the fuel to take the market up to the $22 level. If we get through $22, we’ve got to test about $22.50 to $23, and then we could see some pretty good (upside) movement in silver. We are at an important inflection point for silver. If we can push a little bit higher early next week, we have the possibility to make a quick run up to $22 to $22.50.
The Edge Of A Massive Collapse: Matterhorn Asset Mngmt, Switzerland – From our point of view we are seeing major moves of physical gold out of banks and into private storage because people are worried about the risk of being in banks, as well as the risk of bail-ins. We are continuing to see Swiss banks resisting letting their clients transfer the gold out of the banks.
When we look at the precious metals, it has become quite apparent that we have already seen the lows of the major correction, and we will see massive moves to the upside this autumn and into 2014. The move has already started now, and will accelerate very soon. So for investors who are not fully positioned, right now is the time to invest any spare cash that they have because the upside move in the next couple of months will be considerable in my view.”
Is Silver Setting Up For Significant Upside Price Action This Month? – This year’s dramatic gold and silver price declines are big news. However, since July price lows, some gold and silver analyst are suggesting a price bounce may now be underway, particularly in silver, which at a fundamental level may possess even more positive qualities beyond gold’s at present to contribute to a rally. Silver’s strong price up-draft last year occurred once prices broke out of the trade box that ended at last August’s significant 3RD Saturday options expiration date.
This strong updraft and positive price extension lasted well into mid-September. These past price movements and patterns may become particularly significant to trader’s as we move into this year’s corresponding weeks, especially given this year’s presently strong price symmetry with last year and the coordinated price momentum currently active at these key time-points in their echovectors. Silver just may be setting up for a significant upside price move again this time of year.
Take Advantage Of Discount Sale In Gold, Silver And Palladium – We will observe the public return to the precious metals market similar to 2011. Geopolitical turmoil is increasing with riots in Turkey, Egypt and Brazil. Extremist Iran is advancing on a nuclear weapon. Fiat currency markets especially the U.S. dollar could be on the verge of breaking down into new lows as competitive devaluations are taking place around the globe. Credit downgrades and sovereign debt issues are now riskier than ever as interest rates are beginning to rise.
China and India are buying physical bullion like crazy. China actively encourages domestic retail purchasing of precious metals. India is attempting the opposite, trying its best to prevent a massive bank run by limiting imports.
Indians are buying gold and silver hand over fist as the rupee is falling hitting all time lows. Premiums for physical gold and silver are reaching records. The Indian Government is trying its best to prevent record buying of precious metals as the Indian economy is on the verge of deteriorating fast.
Billionaire Issues Chilling Warning About Interest Rate Derivatives – Will rapidly rising interest rates rip through the U.S. financial system like a giant lawnmower blade? Yes, the U.S. economy survived much higher interest rates in the past, but at that time there were not hundreds of trillions of dollars worth of interest rate derivatives hanging over our financial system like a Sword of Damocles.
This is something that I have been talking about for quite some time, and now a Mexican billionaire has come forward with a similar warning. Hugo Salinas Price was the founder of the Elektra retail chain down in Mexico, and he is extremely concerned that rising interest rates could burst the derivatives bubble and cause “massive bankruptcies around the globe”. Of course there are a whole lot of people out there that would be quite glad to see the “too big to fail” banks go bankrupt, but the truth is that if they go down our entire economy will go down with them.