Remember The Hunt Brothers? The Silver Market Is Now Cornered Again

Summary

1.The Shanghai Gold Exchange is rapidly accumulating silver.

2.Most recently North American speculators increased their net long positions in silver futures. On the other hand, they are still liquidating their net long positions in gold futures.

3.Three entities, SGE, COMEX and SLV, hold 583 million ounces of silver (66% of the forecasted 2016 annual production); in my opinion, the silver market is cornered.

4.Given all this, I expect that in the coming years silver will perform much better than gold.

In my last article on gold I presented a thesis that during the ongoing correction in precious metals the American investors were selling gold while the Chinese investors were buying it. In conclusion, I wrote:

"In other words, to see substantially higher prices of gold the physical accumulation of gold by American investors must begin. Now, according to GLD reports, we see the selling pressure (indeed, the lower one but it is still the selling pressure). The gold bugs have to wait…"

In this article I would like to look at the silver market. The common knowledge is that silver goes in tandem with gold. Putting it differently, the patterns delivered by the silver market should coincide with those delivered by gold. However, most recently silver is sending somewhat different signals from those of gold.

The Chinese are accumulating silver

In my previous article on gold I discussed the differences between the Chinese and American approach to gold. Shortly speaking, the Chinese demand for gold increases when the prices of gold go down while the American investors tend to buy gold when its prices go up (fortunately, during the final stage of a correction in gold prices the Americans start buying again). The same pattern is visible in silver:

Read more - https://www.goldcruderesearch.com/comex.php