Will Silver's Resolute Buyer Step In Again?
Great and Wonderful Tuesday Morning Folks,
Gold is continuing it’s forced price adjustment, even though the US Dollar’s digital printing can’t be hidden anymore with December’s price at $1,488.30, down $7.60 and right beside the usual London low at $1,486.50 with the high at $1,497.10. Silver has no choice but to follow along with its trade at $17.69, down 18.6 cents with the low at $17.675 and the high at $17.875. The over printed US Dollar is still the reason why our precious metals have yet to produce any new highs (for now) with its value pegged at 97.60, up 7.6 points after reaching up to 97.70 with the low close by at 97.51. All this was done before 5 am pst, the start of the FOMC 2-day meeting, the Comex open, and the London close.
Apparently, all international banker eyes are on the FOMC meetings (and subsequent ¼% rate cut) with Gold, under the Venezuelan Bolivar, now trading at 14,864.40 proving a loss of 179.77 Bolivars with Silver at 176.679 Bolivar down 3.446 in the overnight. In Argentina, Gold is now trading at 88,435.73 Pesos losing 1,818.01 with Silver at 1,051.13 taking out 29.55 in A-Peso value. The Turkish Lira’s value for Gold now stands at 8,533.56 Lira’s showing a loss of 101.35 with Silver now at 101.441 Lira’s showing a reduction of 1.945 in value.
Yesterday Silver’s trade was a disappointment price wise, but the amazing point was the Volume in trade that happened before the Comex close. We reported the Open Interest in the October Silver Delivery system to be at 20 and with a Volume of 5 up on the board with no prices. After our report, we got a trading range between $17.89 and $17.77 and with a Volume of 60 posted up on the board. This is three times the amount of Open Interest and before the Options expired. As of right now, the standing demanding Open Interest in the October Silver Delivery system is at 61, and with no Volume posted so far. Today at 10:25 am pst, the October Silver Delivery process will close then we start Novembers. As a side note, I do not recall this type of activity happening within a cereal month’s trading period. Will our Resolute Buyer step in again today? Stay Tooned!
Silver’s Overall Open Interest waned a little during the overnight with the total count now at 221,960 Overnighters proving 1,260 contracts exited the trade the day the Options expired. This is a very small drop in OI compared to the additional 8,137 contracts that were added since last Thursday’s count. What we do not know is if some of these Call Options were the “Out” trade for a short contract or vice versa. One of the scalping trades out there is to short a futures contract (last Thursday?) against the purchased Call and allow the option to be exercised at the close, to exit a short trade taking the spread between the short futures entry and the Call strike. Regardless the Resolutes, trading in the futures contracts, are staying in place keeping the Open Interest elevated in order to keep the prices where they are now.
The FOMC meeting will prove more reasons to be holding physical precious metals while all this gets sorted out. With all the massive printing going on, one can only assume the Federal Reserve will be forced to compete with the “negative rate centrals”, that are trading against and shaving off the profits Americans would have, if our rates were equal or better then the rest. Credit cards, mortgages, auto loan, and business loans, heck, even employment, are all affected by interest rates. If these rates are higher than the other competing nations, American Businesses are paying too much to borrow that which is printed and not earned.
We were asked what the odds would be of a rate cut tomorrow? Not being part of the "In Crowd" we would have to say, the odds of a rate cut are sharply higher than that of the CFTC actually doing their job and charging JP Morgan for its criminal activities in precious metals. So, keep your physical precious metals close, acquire more while you can at these artificially cheap prices, keep a smile on your face and a positive attitude in your head no matter what, and as always …
Stay Strong!
J. Johnson