Physicals Are Found in the Earth, Paper Mâché Is Found in the Markets

Posted at 2:37 PM (CST) by & filed under General Editorial.

Great and Wonderful First Friday of 2020 Folks,

      We start the day off with Gold trading higher with the “now” price at $1,548.90, up $20.80 after reaching $1,554.00 from a low of $1,530.40. Silver is still Silver, even when bombs that may require this metal are dropped, with the trade at $18.22, up 17.4 cents after hitting $18.325 with its starting point at $18.055 during the overnight. The US Dollar is getting supported as well with its value pegged at 96.685, up 16 points after the trade reached up to 96.795 with the low at 96.395. Of course, all this was done before 5 am pst, the Comex open, the London close, and after the Iranian leaders sent one of their general’s, along with support units, into a land not their own, in order to make a statement against our country. That’s a very special kind of stupid right there!

      In Venezuela, Gold now has a value pegged at 15,469.64 Bolivar, proving a gain of 233.71 overnight with Silver now getting 181.972 Bolivar for an ounce, a gain of 2.547. In Argentina, Gold is now priced at 92,535.86 Peso’s proving a gain of 1,268.20 Peso’s in a single night with Silver at 1,087.47 A-Peso’s, a gain of 12.68. In Turkey, where the hostile activities are much closer to their borders, Gold is now priced at 9,252.18 Lira proving a gain of 160.54 with Silver gaining 1.774 with its price at 108.841 T-Lira.

      January Silver Deliveries now show a demand count of 119 fully paid for contracts waiting for receipts and with a Volume of 51 up on the board so far this morning with a trading range at $18.11. Yes, that again is the high/low/last and up 14.4 cents from yesterday’s 2 Volume trade that caused the market to settle lower than the physicals, which were purchased at $17.99 and $17.98, yet the Comex adjusted settlement is at $17.966. The physical demand count fell by 97 contracts during yesterday’s trade proving something we can’t confirm with simple Comex accounting. Either these receipts got settled here into physicals, transferred into a warehouse at the Comex, or were sent to London via EFP paper, so it can be sent back here in a pump and dump fashion again (maybe).   

      The Overall Open Interest in Silver now has a count of 231,162 Overnighters proving the point that 1,462 more short contracts, had to be created out of thin air, to offset the buy orders to neutralize the price more than it should. Comex shorts are only 13,034 contracts away from breaking new all-time high territory. At the same time this is going on, Gold is doing the Silver  “thang” as more and more short contracts had to be created in order to tell the buyers, how worthless it is to hold real money against the paper. Gold’s new life of contract high in paper, not price, is now at 787,920 Overnighters.

     The definition for the term “Overnighters” is the total amount of “buyers” and “sellers” combined. These Overnighters are algo positions as well as the individuals and hedge funds, willing to keep their money at risk over a 24-hour period. Open Interest is the proper term for this, yet the explanations are the same. Regardless, both precious metals have huge increases in paper contracts but not the physicals. Physicals are only found in the earth and it is limited, unlike the paper mâché used to control the price in the markets.

      A Commercial Signal Failure may be set up right here and now! I’ve been involved with a few of these events in the commodities sector over the past few decades with vivid memories when Corn, Soybeans, Wheat, and Cattle, which all blew out the shorts when they discovered they were on wrong side of the trade. Over the past few years, the controllers of paper have had their day, it may be the time when the paper game loses to rock (in paper, rock, scissors fashion). We will know for sure when physicals, needed to supply the game of paper, cannot be found at the Comex. All that can be said now is stay tooned, we’re still waiting in a game where the waiting is the hardest part!

      Enjoy your weekend, keep a positive attitude in the head no matter what, keep your metals as close to you as family, and as always …

Stay Strong!

J. Johnson