In Ted Butler's Archive


I received an email from a longtime subscriber sensing that I had lost a bit of my enthusiasm for the prospects of a silver price surge. I hope that’s not a widely-held opinion, because nothing could be further from the truth. Perhaps it has to do with how long I have been studying silver and what I believe is the natural tendency of tempering one’s words as one ages (I was in my late 30s when I first seriously locked onto silver some 35 years ago).

Truth be told, I consider silver to be much more of a sure thing today than ever before. Imagining sharply higher prices is as easy as falling off a log, and I am hard-pressed to imagine significantly lower prices under almost any future conditions. If I have conveyed anything but that along the way, then to use words from “Cool Hand Luke” I have been guilty of a failure to communicate.

I’m pretty sure I have conveyed my long-held premise that the price of silver (and gold and other commodities) is largely set by paper contract positioning on the COMEX and that is borne out in the weekly Commitments of Traders (COT) report. These positioning changes, along with the concentrated short position in COMEX silver futures lies at the heart of the manipulation argument.

The recent wave of selling and lower prices appears behind us. Now it becomes a question of what transpires on the next rally, which to my mind appears close at hand. I am referring to whether the big shorts add to short positions on higher silver prices, as has always occurred in the past.

I continue to believe that the CFTC privately informed the big silver shorts to knock it off around May 3 and after some fits and starts, the big shorts have largely complied. In fact, I believe the latest price blast lower was the big shorts’ final attempt to clear the decks and reduce their concentrated short position as much as they could. Therefore, I will be surprised if the big shorts add aggressively to their silver short positions ahead.

Should the big shorts refrain from adding shorts, as I expect, then we are talking about a whole new price world for silver. Freed from the shackles of price suppression by the 4 big COMEX shorts this whole new price world should feature gains almost beyond belief. One of the great unintended consequences of our brave new financial world of previously unimaginably high prices for stocks, cryptocurrencies and real estate is that it smoothes the way for shockingly higher silver prices. So let there be no mistake in my current outlook for silver prices – pick an impossibly high price and then double or triple it.

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