See: “The Mechanics Of Precious Metals Price Manipulation” by Jeffrey Lewis (just use the title in your browser and you’ll find it)
This explains how major banks, in order to lower PM prices to the level they desire are able to succeed with ease. Unless this is fully understood small investors are easily victimized in the process. Interestingly Lewis states that the professional mining and trading communities also fall victim to the mega-banks' HFT PM trading agenda. Do YOU think you have what it takes to outsmart them?
Lewis states: “…These sudden moves appear around market opens and coincide with the overlap between the London fixes and the COMEX open. These millisecond trades that have 'broken' the CME platform more than a few times over the last 6 months are fill and kill trades. …”
That certainly is true from what has been noticed by looking at Kitco and Goldprice charts. It seems that there is a worldwide presence to enact these kinds of trades, not only at the London fix and COMEX open.
For example, there was a large take-down at the Globex close today which will open in Sydney, Australia on Monday. These movements are impossible for the average investor to participate in and in any other market would be the subject of anti-trust actions.
That’s why the rest of us, who know this is happening and see no moves to curtail it, find that only long term investment decisions come out on the positive side. HFT has no way of overcoming those of us who use long term decisions that can span generations, but valid bottoms have to be identified and traded. This, by the way, requires no special courage in picking a bottom when the horizon is far into the future. You can believe that the brokerage industry and financial planners HATE this methodology as they rely on those who do not use it to enrich themselves.
But manipulation is normal in every market, only limited by the ability of the manipulators, supply , demand and enforced laws. The Outrage is the law is not enforced, the cop on the beat has been bribed, guess that is normal as well. At the extremes supply and demand will rule. The price swings above and below value in every market, but it takes longer when the market isn't entirely free.
“Normal”, unfortunately is a relative term bringing about the slippery slope that has led to the massive financial frauds we are currently experiencing. What wasn’t normal some time ago has currently become “normal”. It has become so “normal” that Eric Holder refuses to indict the mega banks for the fraud they have been engaging in due to what he says would bring about economic catastrophe. That, by the way, is the same argument threatened by Nicolas Biddle when President Andrew Jackson stated he would see to it the charter of the 2nd Bank of the US (the forerunner of the Federal Reserve) was not renewed, which he succeeded in doing. When the government replaced the Glass-Steagal Act it allowed commercial banks to operate like investment banks, thus becoming casinos with their depositors’ and the publics’ money. This should NOT be considered “normal”.
The word “normal” has become the most overused word in the American lexicon.
It is obvious that we are headed for a fascist dictatorship brought into being by future “normal” events.
As an addendum to this it is suggested that a visit to Wikpedia’s articles on Cartels and Collusion be visited. These perfectly describe what is taking place in the PM markets, despite what gurus like Adam Hamilton of Zeal, and others of similar viewpoints, might say to the contrary. In the discussion on Cartels it even mentions that Commodity markets are most often inhabited by Cartels.
At some level most on this and related message boards understand these concepts. But it is always interesting to view a broader and more definitive explanation most often written by experts in those fields. This removes all doubt about the manipulation taking place in PM markets, if there was any to begin with.