Silver Above $30 and This Has Nothing to Do with Today's CPI, Dollar Dropping or Fed Decision.
Shanghai Silver vaults fell to the lowest level since January 2016. 36 tons vanished since last Friday. Vaults bleed to 697 tons or 22.4 m ounces. Silver could be all gone by 4th of July
Today you will be reading really bad headlines like
Silver Rips Above $30 On Good CPI Data
Silver Soars as DXY Drops
Silver will continue to move higher but nothing in USA matters like
Inflation data
Perceived Dollar Strength
Job numbers
COMEX lies
LBMA lies
200 day or 50 day moving averages
Lines of support or resistance
All TA is out the window
Shanghai Silver vaults fell to the lowest level since January 2016. 36 tons vanished since last Friday. Vaults bleed to 697 tons or 22.4 m ounces.
Here is what makes Silver Move
Shanghai Gold Exchange.
How the game works
On one side of the field there are industrial users (aerospace, military, solar, electronics, robotics, AI, etc) They wish for low factory inputs so they employ their colleagues in banking and Government (campaign donations, appointments to CFTC, etc) to engage in trading paper silver like it is selling off. They can only do this trick in London and Comex which is paper.
On the other side of the field are Silver investors who wish for higher silver prices. These are people like you smart enough to subscribe to our newsletter.
The game between these two groups determines the future price of silver. Due to the massive silver deficit, investors will ultimately win. Industrial users ultimately will be forced to pass on the higher product prices (satellites, bombs, fighter jets, space stations, torpedoes, nukes, EV batteries, solar panels, etc) to end users.
Shanghai Gold Exchange Legit vs Comex (which is now SGE’s Source for Cheap Metal)
The physical delivery process on the Shanghai Gold Exchange (SGE) differs significantly from COMEX in terms of requiring actual deposits of physical metal upfront and facilitating the transfer of ownership of that metal upon contract expiration. Here are the key differences:
Shanghai Gold Exchange (SGE)
To trade gold and silver futures on SGE, traders must first deposit an equivalent amount of physical bullion as collateral with SGE's designated vaults.
The amount of metal a trader can buy is limited by how much they have deposited with the exchange.
At contract expiration, physical delivery takes place where ownership of the pre-deposited metal is transferred between the buyer and seller.
SGE acts more like a physical spot market, facilitating the actual transfer of bullion between parties.
COMEX aka CRIMEX
Traders on COMEX do not need to deposit any physical gold or silver to trade futures contracts.
COMEX contracts are predominantly cash-settled, with physical delivery being rare (less than 1% of contracts). - LOLOL
For the few traders opting for physical delivery on
COMEXCRIMEX they must notify the clearinghouse and meet additional margin requirements by the First Notice Day.COMEXCRIMEX does not necessarily hold enough physical inventory to meet simultaneous delivery obligations on all open contracts.
In essence, SGE requires traders to back their trades with pre-deposited physical metal and facilitates the transfer of that metal at expiration, while COMEX CRIMEX is a "paper" market where most contracts are cash-settled without actual metal changing hands.
Conclusion
1. The West has completely lost control of Silver Pricing
Shanghai vaults down to 22.4 Million ounces
Keep in mind India India imported 2,932 tons in Q1 2024 so doing the math
There are 4 months in a Quarter
2,932 divided by 4 is 733 tons
733 tons is 23,456,000 ounces.
Silver could be wiped out by 4th of July
Now do you understand why we say Silver is the most undervalued commodity in the World?
We see Gold at $25,000 per ounce based on previous posts, US debt divided by gold stockpile (see previous posts on this topic)
This number is right in between Luke Gromen’s $20,000 Gold and Jim Rickards $27,000 Gold call
It also aligns with BRICS ++ strategy of using rising Gold prices to buy more oil than they could using US dollar
The Petrodollar ended June 9th
Game over for US Dollar
The Gold and Silver Bull Run has officially started