cheka.
30th April 2016, 06:54 PM
http://seekingalpha.com/article/3969889-speculative-silver-positions-blowing-extremes-time-different
More interesting though is what is going on with speculative silver positions, which have completely blown up! Despite silver closing at $16.95 at London's close on Tuesday, which is around a dollar less than its current price, speculative silver longs surged to a new all-time high.
That red line is the net speculative positions of money managers which have surged past 70,000 contracts net long to a new all-time high above last week's high. COT report money managers have never been more bullish on silver and we are way above levels we saw in 2011 when silver was close to $50 per ounce.
Our Take and What This Means For Investors
We sound like a broken record as we think investors need to be EXTREMELY cautious here as historically it is usually a bad move to buy when animal spirits are so excited - and they certainly are based on these positions.
But we always like questioning our positions and think of why we may be wrong here - what could continue to make gold and silver surge?
There is a physical shortage of silver and this is the start of a rebalancing of the market at much higher prices to facilitate new silver production or investor sales.
Investors are tiring of central bank jawboning and are seeing the handwriting on the wall suggesting that central bankers simply cannot raise rates.
The massive amount of money printing has resulted in a ton of money sloshing around in the financial system, and it is now commodities' turn to spike as they are the new "in vogue" financial asset.
We are seeing the first signs of inflation as commodities sense a true exit from the deflation of the past decade.
Demand for commodities are returning as the economy recovers and after the cuts in production over the past few years that demand is being reflected in improved pricing.
more at link..
More interesting though is what is going on with speculative silver positions, which have completely blown up! Despite silver closing at $16.95 at London's close on Tuesday, which is around a dollar less than its current price, speculative silver longs surged to a new all-time high.
That red line is the net speculative positions of money managers which have surged past 70,000 contracts net long to a new all-time high above last week's high. COT report money managers have never been more bullish on silver and we are way above levels we saw in 2011 when silver was close to $50 per ounce.
Our Take and What This Means For Investors
We sound like a broken record as we think investors need to be EXTREMELY cautious here as historically it is usually a bad move to buy when animal spirits are so excited - and they certainly are based on these positions.
But we always like questioning our positions and think of why we may be wrong here - what could continue to make gold and silver surge?
There is a physical shortage of silver and this is the start of a rebalancing of the market at much higher prices to facilitate new silver production or investor sales.
Investors are tiring of central bank jawboning and are seeing the handwriting on the wall suggesting that central bankers simply cannot raise rates.
The massive amount of money printing has resulted in a ton of money sloshing around in the financial system, and it is now commodities' turn to spike as they are the new "in vogue" financial asset.
We are seeing the first signs of inflation as commodities sense a true exit from the deflation of the past decade.
Demand for commodities are returning as the economy recovers and after the cuts in production over the past few years that demand is being reflected in improved pricing.
more at link..