Diversification is a protection against ignorance. - Warren Buffett
It wasn't too hard to spot the moment that JPMorgan et al showed up in the precious metal market yesterday in New York, as they all got capped and began to slide lower at exactly 9:30 a.m. EST. It's hard to believe that they could be this blatant, but they are, and obviously don't care, as there are no adults [CFTC] in charge anymore, and this new Volcker Rule doesn't kick in for another 18 months or so, if then.
As I mentioned in yesterday's column, Tuesday was the cut-off for this Friday's Commitment of Traders Report, and I must admit that after yesterday's price action, I'm not optimistic about what it's going to show.
I would suspect, because of their long-side gold corner in the Comex futures market, that JPMorgan et al has been selling long positions at a profit over the last couple of days in order to cap the price.
In silver, it's obviously different, as JPMorgan still has a [much-diminished, but still market-controlling] short-side corner in the Comex silver market. And as Ted Butler keeps pointing out, correctly I might add, it's whether or not JPMorgan piles back in on the short side that will determine the fate of the current rally in that precious metal. However, there's no doubt in my mind that the raptors [the small commercial traders other than the 'Big 8'] will be selling part of their grotesque long position and taking profits as this rally unfolds and the technical funds look to cover their record short position. But in the end, the how far, fast and high the silver price rises, rests solely with JPMorgan's conduct going forward.
I guess I should just wait until I actually see the COT Report on Friday before I trash it, but I was just thinking out loud in the last few paragraphs.