Now to the markets- gold and silver are rallying strongly this morning, as is to be expected after a severe 2-day rout. Silver gained about .50, topping just under $30 at $29.90, and gold rallied $25, with $1600 providing resistance. It will be extremely important for gold to regain $1600 and silver to get back above $30 by today's close to prevent a continued correction into next week. Both of these levels hold significant technical and psychological importance, and if price does not quickly regain these levels, bearish sentiment will increase.
Contrasted with September's smash, when premiums skyrocketed, premiums seem to be mostly unchanged through this week's correction. With the negative sentiment almost palpable among silver investors, it appears many silver investors are holding their dry powder in hopes of $20-$25.
I expect JP Morgan to be covering a substantial amount of their 15,000 remaining silver shorts into the current smash. We won't be able to tell for sure whether this is occurring until next Friday's COT report- but expect it to show a massive liquidation of JPM's naked shorts. The big question will be whether The Morgue will again add to their shorts into the oncoming rally as has been their SOP over the past 10 years, or whether they will finally step aside and allow the silver freight train to leave the station.
|MARKET IS OPEN |
(Will close in 6 hrs. 38 mins.)