I borrowed some paragraphs from Ed Steer's Gold and silver daily. I hope he doesn't kill me for using this much of today's column, but it's important information. You might notice some jargon like "1 through 4 commercial traders" and the "5 through 8" commercial traders. These constitute the 8 largest commercial banks that trade Gold and silver future contracts on the COMEX (The Commodities Exchange). "Ted Butler's Raptors" refers to small commercial banks that supposedly play into the price fixing games of the Big 8 commercial banks.
I must be honest - the more data that is released about this manipulative short selling in the Silver and Gold futures market, the less and less likely it seems that it's a mere conspiracy theory worthy of the loony bin. To prove the point, I'm willing to bet a doughnut that the next serious price smash, if it doesn't come next week on the heels of Friday's poor jobs numbers (and therefore as a counter intuitive move against the traditional purpose of gold and silver as protection), will come just before or just after the next options expiry date: either the week of the 16th or the week of the 23th of April. It will depend on how quickly the price moves up from here, and whether or not the small traders keep their long positions in the face of the bogus High Frequency Trade sell orders that the price manipulators send out over the wire.
You can (and should) read all of Ed's material by signing up for his daily email service over at Casey Research.
Ed Wrote Today that
"In silver, there was an increase in the
Commercial net short position during the reporting week, as the bullion
banks and other Commercial traders increased their short position by
1,658 contracts, or 8.3 million ounces. The Commercial net short
position now sits at 156.68 million ounces.
The '1 through 4' Commercial traders are
short 174.65 million ounces...and once you remove the 25,257
market-neutral spread trades from the Non-commercial category, these
four traders are short 39.1% of the entire Comex silver futures market.
The lion's share of that amount is held by JPMorgan. The '5 through 8'
Commercial traders are short an additional 44.83 million ounces of
silver. Of the 45 short-side traders in the Commercial category, the
'big 8' traders combined are short 48.9% of the entire Comex silver
market. That's concentration...and this is what the CFTC and the CME
Group refuse to deal with.
The Commercial net short position in gold
declined by 761,000 ounces...and now sits at 17.75 million ounces. The
'1 through 4' Commercial traders [read bullion banks] are short 11.7
million ounces of gold...and the '5 through 8' commercial traders are
short an additional 5.5 million ounces.
Of the 45 short-side traders in the
Commercial category, the 'big 8' Commercial traders are short 44.4% of
the entire Comex futures market in gold...once the 20,401 market-neutral
spread trades are subtracted from the Non-Commercial category.
Of course, thirty minutes after the 1:30
p.m. cut-off for this COT report, everything began to change. Once 'da
boyz' were through bombing the precious metal market 24-hours later, it
was a given that the internal structure of both the silver and gold
markets had become far stronger...and this already bullish COT report is
vastly more so at this point. But we won't know how much of an
improvement there was until next Friday's COT report.
In silver, the April Bank Participation Report
showed the 4 U.S. banks were net short 19,896 Comex silver
contracts...which is 21.8% of the entire Comex futures market in silver.
I would guess that close to 90% of that position is held by only one
U.S. bank...and that would be JPMorgan. The March BPR
showed that these same four U.S. banks were net short 23,665 Comex
silver contracts, so it's declined quite a bit over the month. This
should be no surprise since the drive-by shooting that began on February
29th.
There are 14 non-U.S. banks that hold
positions in the Comex futures market in silver. In the April report
these banks were net short 2,275 Comex contracts...which is a decline
of 300 contracts since the March report. That works out to about 163
contracts for each bank...and it's my bet that the vast majority of this
net short position is only held by two or three of the 14 reporting
banks. But regardless of that, their positions are immaterial in the
grand scheme of things.
In gold, the same 4 U.S. banks are now net
short 69,473 Comex contracts...down from 92,052 Comex contracts in
March. These 4 U.S banks are net short 17.9% of the Comex futures
market in gold.
The 19 non-U.S. banks are net short 37,802 Comex gold contracts...a smallish increase
from March's BPR report where they held 36,257 contracts net short.
This is less than 2,000 Comex gold contracts held short by each bank
but, just like silver, I'd guess that three or four banks of the 19 that
report holding Comex contracts, hold the lion's share of this non-U.S.
bank short position in gold as well.
As you can tell from these numbers for both
silver and gold, the biggest changes from the March to April Bank
Participation Reports were in the size of the positions held by the 4
U.S. banks. This engineered price decline that began on February 29th was "Made in the U.S.A." The changes in the non-U.S. banks in both metals was immaterial, as it almost always is.
And, just like silver, the Bank
Participation Report, if it included the price decline of Tuesday and
Wednesday, would be a vastly different animal from what it showed as of
the Tuesday 1:30 p.m. cut-off. That applies to all the precious
metals...and copper as well."
