This is Big, Brothers
from The Wealth Watchman:
Remember how several months ago, I wrote a piece asking if silver’s moment had arrived? In that piece, I cautioned at the time that silver hadn’t yet shot through important resistance points. I said that $18 seemed the ‘line in the sand’ for our banking friends, and that when $18 was broken…it could lead to $20 very, very quickly.
Well, brothers: did I call it, or did I call it?
For as soon as silver broke through and closed above $18, a powerful move has taken place. All this has happened in a week too, by the way. From the outside, it appears that silver’s gap up to $20 seems unjustifiable, but really, it’s very normal and reasonable, here’s what seems to have happened.
Mind the Gaps
Really, what silver(and gold, to a lesser extent) are simply doing, is filling the downward gaps that the banks created with them several years ago. In spring of 2013, the banksters met with Obama at the White House, in a closed door meeting, and several days later…
Silver was taken from $28, and broken through key “support” of $26 with great fury, as you can see in this chart.
Then, just a few days later, silver was driven through more “key support” at $22, and from there, $20 fell before very long.
$18 ended up being the new ‘floor’ for a year or so.
The point in all this…is that gaps usually have to be filled, and silver’s gaps downward through 26, 22, and 20(being artificial and manufactured), just beg to be filled upward almost as quickly. So, the gap up to $20 has been filled. The gap to 22 is next…and when 22 falls as decisively as $18, anyone wanna take a stab at what happens next?
Let’s just say, another move as quick as the one we just saw(but bigger) could take us back to $26 very rapidly. Now, the enemy has thwacked silver and gold since the initial move higher to $21+, and at this moment a tremendous battle is being waged by the shorts! They must keep silver under $20 and change. They must. If they lose this battle at this juncture, then we will most definitely fill the gap to $22, and then $26 will be a slam dunk, and it will happen in a blink.
Watchman, I get that gaps are being filled on the chart, but what changed so quickly to make silver soar so violently?
Good question, here’s what seems to be happening.
First off, we know that our banking foes have been perennially short silver, to the tune of hundreds of millions of ounces, that’s nothing new. What IS new, is that they were steadily building up their short positions again to hammer silver during an options expiry week, only to get a stunning, enormous surprise: the British vote for a Brexit from the EU.
Here’s the now famous chart showing the trend change, post Brexit.
Brexit seems to have caught many players, even large players “flat footed”. Even George Soros lost over $1.5 billion in his long position in the Great British Pound, initially. Many traders have egg all over their face from that event, and it appears the same rings true for JP Morgan and friends.
This market event has now left those commercial banks holding the bag, with hundreds of millions of ounces in their commercial short category now bearing down upon them with crushing force.
Since the moment Brexit occurred, some very big players seem to have realized that they got caught with their pants down in silver, and that silver’s next move was higher, not lower. Many of those big players are now either fighting for their lives around a very key level, or they’re running for their lives. It is now looking as if it might turn into a classic short squeeze(not simply in the futures buying, but also perhaps in physical IF the East steps up its massive silver imports), as thelatest video from BrotherJohnF illustrates.
The problem for the banksters, is that the market forces bearing down on them now are heavier than ever, and the momentum is on the side of the longs. Brexit was the event of the year. It will color everything else that comes after it(from bank bailouts, to currency interventions, to interest rate policy), and many market players now understand that Brexit means the central banks are gonna print a ton of cash!
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