In Ted Butler's Archive


The current COT (Commitment of Traders) structure in COMEX silver is better, in my opinion, than it has ever been in the decades I have studied the report. That doesn’t mean I can guarantee an immediate price move up or that the structure might not even get better at some point in the future. It does mean that I certainly expect a big move up soon.

Even with price capping by the largest eight silver shorts, silver can jump quickly to $20 or higher. Without such price capping, silver can jump by ten to twenty dollars in a hurry. A little more than 4 years ago, silver ran to almost $50 in a matter of months. The setup today is infinitely better, both on a COT basis and with what is happening in the physical market.

Without a doubt there is a radical change in JPMorgan’s formerly concentrated short position in COMEX silver futures. In the six years in which I had first discovered that JPMorgan (as a result of acquiring Bear Stearns) had become the biggest COMEX silver short, the bank has never held a smaller short position than it does now. Considering what I think the bank has accumulated in physical silver over the past three and a half years, it appears to me that JPMorgan is massively net long in silver, to the point of perhaps holding the largest silver position in history.

There is no question that a concentrated position is at the heart of every manipulation; and JPMorgan’s concentrated short position in COMEX silver since March 2008 meant that the bank was the big silver price manipulator. But now, JPMorgan is no longer the big silver short and may now be the big silver long. It took years and a price rigging that resulted in a sickening drop in the price of silver, but JPMorgan has succeeded in completely reversing its overall position in silver from short too long.

Without JPM joining in, I doubt the big eight will succeed in capping prices as they have on every past occasion. And considering the swirl of negative news surrounding big banks influencing commodity prices, it’s hard for me to imagine JPMorgan not quitting their manipulative control of silver to the downside.

The recent double-cross of the raptors (the smaller commercials, who were net long) is remarkable in its own right. The forced sale of more than 12,000 net contracts by around 8 to 10 raptors over the past few weeks has probably knocked those traders out of silver permanently considering their losses of $200 million. There is no doubt these 12,000 contracts would have been sold on the next silver rally and now that is impossible. Mathematically, this greatly increases the burden on the 8 big shorts. They will have to sell many more contracts short than they would have had the raptors not been double-crossed. This increased short selling burden on the big 8 should persuade them not to try. If they do try, they may fail.

I have a hard time imagining how silver won’t melt up in price. I think I should express this as clearly as possible. And yes, this makes silver the best possible investment of all. While I am more convinced of a silver price melt-up, the COT structure supports higher prices in gold, copper, platinum and palladium as well. There are perhaps many factors in place to propel these commodities higher, but silver stands alone as the prime melt-up candidate.

For subscription info please go to

Start typing and press Enter to search