Are Commercial Traders Preparing for a Vault in Silver?

While seemingly everyone in the silver community is preparing for the world to end when QE2 finishes up on June 30th, commercial silver traders are signaling that they have a different outlook for the shiny metal.
As of Friday 6/10, commercial traders have built their long positions (futures & options) up to 52,553 contracts. This is roughly the same levels of longs the commercials held when silver reached its panic lows and bottomed near $8 in late 2008!


If silver continues to decline from here and retests the recent lows near $32, look for commercials to establish new all-time record highs in their silver long positions.


This doesn't guarantee silver can't or won't decline further from current levels, but it does indicate that the commercial traders, who have been most successful at trading the silver market during this bull run, are nearing record long positions, indicating they are looking for a big move up in silver from here.

Silver COT Report - Futures & Options Combined
Large Speculators			Commercial		Total
Long	Short	Spreading	Long	Short	Long	Short
29,619	6,270	71,800	52,553	93,481	153,972	171,550
-687	4	-56	1,281	-20	538	-72
Traders
101	35	88	42	48	175	148
	Small Speculators
	Long	Short	Open Interest
	33,015	15,437	186,987
	-852	-242	-314
	non reportable positions		Change from the previous reporting period