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Eyebone

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I am definitely looking to get a short position on if silver can mount any sort of a rally...so far - it hasnt been able to.

News that China is cracking down on the use of copper to fund loans. I remember previous ZH articles about how the underlying collateral had been used multiple times and then subsequently sold. I think that is a mess with potential to really slam the price of copper downwards - not to mention new home building in the dumps...

I have said before - it is highly unlikely that silver will find strength while copper is being taken to the woodshed. Not impossible...but, highly unlikely.

When anybody says 'position' or any other investor speak, I cringe.

You have a criminal market, run by criminals.

There is only Constitutional money.

Jeez, I feel like a Jesus Freak.
 

Strawboss

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Yes but - the key to keep in mind is that it will take a while for the companies to start closing mines. Weatherman makes the same point as you do in this regard - and my rebuttal to him is the same. Copper mines arent closing in the next few days/weeks or probably months. Heck - it could be another year or more before they start closing.



Isn't falling copper prices good for silver prices? Falling demand and prices for copper mean this mines close and will affect supply for silver for all those mines that pull up silver with the copper.
 

Ahillock

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Agreed Strawboss. I was thinking more long term perspective for silver prices if copper prices stay in the woodshed. I realize those forces are strong and slow to change. Wouldn't expect a change over night.
 

jelly

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I presume you mean that you SOLD call options earlier? Is that the same as a PUT?
Yes, I sold call options to "lock in" gains on my mining shares, without selling out of them. Its similar to a put in that you sell call options when you think share prices might go down or sideways for a period of time. But different in that the gains are limited in selling call options, but virtually unlimited in buying a put option.

Call options are sold with the hope that they expire worthless, which mine did.
 
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Hi Strawboss! Long time :) I'm with you, little sister decisively crossed the line. And, I don't think she's gonna squeeze as prime time suggests. It's going to be swift.
I have to say a ugly as the charts are (gold too) - they are playing out beautifully.

~serene
 

Strawboss

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Welcome Serene...

Still seeing every rally attempt in silver getting stuffed...

Hi Strawboss! Long time :) I'm with you, little sister decisively crossed the line. And, I don't think she's gonna squeeze as prime time suggests. It's going to be swift.
I have to say a ugly as the charts are (gold too) - they are playing out beautifully.

~serene
 

Shortstack

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I presume you mean that you SOLD call options earlier? Is that the same as a PUT?
He started with a blank piece of paper. The then wrote some words on the paper. It said "the bearer of this piece of paper has the right to buy x * 100 shares of "abc mining corp" if and only if the price = $5 per share or above. This offer only good for 27 more days. So he "wrote" a call.

He then had the choice to put that call option under his pillow, or sell it to someone who thought that "abc mining corp" would rise above $5 dollars within the next 27 days. So he sells the call option he just created (he wrote). Lets say "abc mining corp" went to the moon, and a few days later was trading at $23 a share. If the jelly had no shares, and the owner of the call wanted to "exercise" against jelly, then jelly would have to buy shares on the market and sell them to the owner of the call. So selling "uncovered" calls can be a very expensive mistake if the stock goes through the roof. But since jelly owned the underlying shares, no matter what the current market price, jelly will sell his shares for $5 a piece (plus the cash the buyer paid for the option contract)

Now, if the the shares are below $5 for the whole 27 days, then jelly keeps the money the buyer of the call option paid to him, plus the shares.
 

CrimsonGuardJay

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Hey guys, figured y'alls might want to know JM bullion is running a promotion on silver eagles, spot + 2.29, free shipping. You wont find a better deal than that anywhere.
 

Thecrensh

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They must be forecasting a dramatic drop in price and are attempting to cover their losses beforehand...
 

CrimsonGuardJay

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Don't PM dealers have short positions in silver/gold etc equal to their physical holdings, so that if the market goes down they dont really lose anything, they just have to keep the volume of sales consistent (premiums)?
 

Strawboss

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Any decent sized dealer hedges. A mom and pop operation may or may not. But yes - their money is on the premiums.

Don't PM dealers have short positions in silver/gold etc equal to their physical holdings, so that if the market goes down they dont really lose anything, they just have to keep the volume of sales consistent (premiums)?
 

jelly

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I purchased some Jan. 2016 call options on SLV on Friday. Due to the lack of volatility in silver, the options on silver are dirt cheap right now. If silver comes to life and starts making some moves higher, the options will increase in value significantly.

I only bought a very small amount, so I'm not out much if I'm wrong. However I do think we'll be much higher than $19 come 2016.
 

pitw

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Good luck on that purchase. I put my monthly allotment for silver into a 1985 Ford truck.
 

Shortstack

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I purchased some Jan. 2016 call options on SLV on Friday. Due to the lack of volatility in silver, the options on silver are dirt cheap right now. If silver comes to life and starts making some moves higher, the options will increase in value significantly.

I only bought a very small amount, so I'm not out much if I'm wrong. However I do think we'll be much higher than $19 come 2016.
At what strike price Jelly? I used to buy way out of the money leaps. Leaps are another name for very long dated options. So i would buy an 18 month out expiration date call option on SLV @ $30 strike when silver was trading at 18 lets say. This was until the compliance accountants at my firm told me to stop. New policy they said, no securities of any kind without express authorization from compliance, and oh, disclose all monthy brokerage statements from now on. Which was OK because that was part of the reason why i switched gears and started my phyzz accumulation phase. And I was a not a very savy phyzz buyer right out of the gate, buying tubes of silver eagles off fleebay at sometimes super inflated prices.
 

jelly

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I did the $24 strike price.
If we get a pullback next week in the miners I may pick up some 2016 GDXJ calls. I think the stocks will perform better at first as they recover from extreme discounts, so gdxj calls would likely be a better play than slv calls. I just thought the SLV calls were good buys given the lack of volatility (and hence cheap options). I already hold a couple 2016 $50 gdxj calls, and will likely pick up a couple more.

Again, these are just fun speculation, but I think they will turn out very well considering the oversold condition on the long term charts, and the extreme negative sentiment.

On a side note - if you know what to look for in junior miners and exploration companies, those will perform as well as call options, yet will never expire.
 

Shortstack

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Look at waayyy out of the money calls next time. As in a low to mid 30 strike. But minors are diff in that the company may be nationalized, ect. And as we all would agree here, since SLV is 100% backed by real silver (derivatives) there is no counterparty risk on SLV.
 

jelly

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On a side note, after last week it appears that silver has begun the next stage in the bull market. And the key is oil. Oil staged a nice strong breakout from resistance, and the precious metals and oil typically go hand in hand. Now that oil is starting to head higher, I expect silver to do the same. Not to mention the oversold condition on the long term charts, and the extreme negative sentiment. As a contrarian investor, Silver is a no-brainer right now.

I know more experienced people think silver is still in a downtrend, and will continue lower this summer. But in my opinion, this is it, this is the beginning of the next stage in the bull market.
 
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jelly

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Look at waayyy out of the money calls next time. As in a low to mid 30 strike. But minors are diff in that the company may be nationalized, ect. And as we all would agree here, since SLV is 100% backed by real silver (derivatives) there is no counterparty risk on SLV.
Thanks, I will have to look into those on my next purchase. I think long term options on silver right now are an excellent buy if you think the metals are going higher starting this summer. Due to the complete lack of volatility over the past couple months, the premium on SLV call options has decreased significantly.

But like I said, GDXJ calls are a much better buy as the miners basically explode coming out of a correction like we've had. That is where the biggest gains will be at first. And what you have mentioned is why I'm buying the GDXJ calls as well. If a nice miner you own shares in is nationalized, you are sunk. However, GDXJ will barely be affected by a nationalization. So its safer. Of the mining stocks I do own, I'm very careful about where their mines are. I refuse to own a company who mines in a unstable country. When gold and silver really take off in a few years, you can bet there's going to be a string of nationalizations as the coming hard times will cause governments to become desperate for money.
 

Strawboss

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And as we all would agree here, since SLV is 100% backed by real silver (derivatives) there is no counterparty risk on SLV.
I would disagree.

SLV will no doubt end up being a "bag" and its shareholders will be the "holders".

The question is "when?"

Until then - options on SLV will be fine..Until they arent... When that will be...who knows...
 

southfork

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I would disagree.

SLV will no doubt end up being a "bag" and its shareholders will be the "holders".

The question is "when?"

Until then - options on SLV will be fine..Until they arent... When that will be...who knows...
Not unlike crimex is it?
 

Strawboss

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Southfork - I hope you didnt take my disagreement to your previous statement as personal...it was NOT. YOU are one of the people on GIM2 whose opinions I value the most...I just cant agree with you on the point in question...just wanted to make that clear...

Having said that...YES...SLV is exactly like Crimex...levered to the gills...and when the music stops...its going to be a time of weeping and gnashing of teeth...

Not unlike crimex is it?
 

Shortstack

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I would disagree.

SLV will no doubt end up being a "bag" and its shareholders will be the "holders".

The question is "when?"

Until then - options on SLV will be fine..Until they arent... When that will be...who knows...
I did say it was backed by 100% real silver (derivatives). The zero counterparty risk was a joke, so good on all of you for disagreeing.

Maybe I will say it this way. SLV is likely not backed by real silver. I would add that the extremely low audit cost tells me that not even the auditors are counting each bar of silver.
 

Strawboss

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$20 is obviously the magic number for silver. The line in the sand at the moment.

I wouldnt be surprised to see price rise above $20 - suck in all the buyers, and then they pound the snot out of it.
 
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$20 is obviously the magic number for silver. The line in the sand at the moment.

I wouldnt be surprised to see price rise above $20 - suck in all the buyers, and then they pound the snot out of it.
So cynical, Boss (with good reason).

I cannot help myself, however:
 

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pitw

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If the rocket takes off I'll be only taking half a load with as I ain't buying yet.
 

Strawboss

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Here is what I am seeing...

silver.jpg
 

Oldmansmith

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Thanks boss, was looking to buy physical on that last dip but thought might go lower.....holding for now.
 

dpong

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Hmmm, Strawboss. Silver up a buck in a day, and barely a mention on a forum called "Gold Is Money".

Most guys on this site wouldn't buy silver if it sauntered up to him wearing lipstick and a tight skirt. (Ok, exaggerating for effect, so sue me!)

I bought a long-term option 2 days ago that was betting that silver wouldn't trade above 21.65 by January 15, 2016. Got that? 2016!!

WTF? You guys are so beaten down it is incredible. But that is a pretty good sign. Did you see the CPI report that just came out? The Feds didn't care, are still fighting deflation. But no. What we have is accelerating inflation at the moment. Still low, but rising rapidly, assuming trend continues.

What's not to like?

Ever consider a contrarian stance?

Best to all,
dpong
 

Strawboss

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RSI on silver is currently at 80 on the daily.

Silver is very much overbought at this juncture. Now - whether silver can bleed off its overbought condition without being smashed remains to be seen.

I suspect that this is a short covering rally - it has all the indications of being such...

What I will be looking for is for silver to make a higher high (after a short correction) but where the RSI peaks at a lower number than present. That would create a negative divergence and be a sign that the short covering has exhausted itself...

Now - just because that is what i am looking for doesnt mean that is what is going to happen...Silver could fly straight to $26 for all I know. I highly doubt it...but, with silver anything is possible.

Hmmm, Strawboss. Silver up a buck in a day, and barely a mention on a forum called "Gold Is Money".

Most guys on this site wouldn't buy silver if it sauntered up to him wearing lipstick and a tight skirt. (Ok, exaggerating for effect, so sue me!)

I bought a long-term option 2 days ago that was betting that silver wouldn't trade above 21.65 by January 15, 2016. Got that? 2016!!

WTF? You guys are so beaten down it is incredible. But that is a pretty good sign. Did you see the CPI report that just came out? The Feds didn't care, are still fighting deflation. But no. What we have is accelerating inflation at the moment. Still low, but rising rapidly, assuming trend continues.

What's not to like?

Ever consider a contrarian stance?

Best to all,
dpong
 

dpong

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Actually, the option seller was betting silver wouldn't go above $20 by January, 2016. I paid 1.65 per share meaning that I bet that silver WOULD trade above 21.65 by January Freaking-2016.

WTF?
 

dpong

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True enough, Strawboss, and I really respect your work. But at $22, please become a believer.

I was late to the party a little, and only bought silver at 7.50. I had been concentrating on gold before that. But 7.50 felt like picking up money off the floor. And at this point in the 'cycle' if you will, buying under 20 feels the same way to me. Some patience may be required, but this thing has been beaten and kicked in the teeth. Blood is already in the streets, as it were. And economic times they are a changing.

Best of luck to you and yours,
dpong

RSI on silver is currently at 80 on the daily.

Silver is very much overbought at this juncture. Now - whether silver can bleed off its overbought condition without being smashed remains to be seen.

I suspect that this is a short covering rally - it has all the indications of being such...

What I will be looking for is for silver to make a higher high (after a short correction) but where the RSI peaks at a lower number than present. That would create a negative divergence and be a sign that the short covering has exhausted itself...

Now - just because that is what i am looking for doesnt mean that is what is going to happen...Silver could fly straight to $26 for all I know. I highly doubt it...but, with silver anything is possible.
 

dpong

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PS. I repeat: Silver up a buck in a day. GIM2 is quiescent. Think hard about that.
 

Strawboss

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GIM2 is a place full of veterans of the PM price wars. Many of us have been here for years and years and have seen this sort of thing over and over and over again... A one day event doesnt do much for us...

We all have our physical stash in addition to whatever paper positions (if any) we may have. If the price continues to rise...GREAT. Looking forward to it. If it crashes and burns...I wouldnt be surprised. I still think $14 is a distinct possibility. It doesnt HAVE to drop to $14 - I am just saying I would not be surprised if it did over the next several months to about a year from now...

PS. I repeat: Silver up a buck in a day. GIM2 is quiescent. Think hard about that.
 

dpong

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I, too, am a veteran with (well, I won't tell you), and seen the wars. I was an Admin on this site, and you may or may not remember me. We HAVE seen this thing over and over again, and it has trained us to duck and cover. I have told you that I respect your work, and I do. You may be right, and I may be wrong. I'm just pointing out that Silver sentiment is what seems to me to be EXTREMELY low. EXTREMELY. Inflation is at low levels but starting to tick up.

I admire your discipline, and I recognize it.

Simply I urge you in your overall view to consider the contrarian position.

And I wish you the best of luck and fortunes.

Kind Regards,
dpong

PS. If Silver Sammy comes back, well then............
 

Shortstack

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PS. I repeat: Silver up a buck in a day. GIM2 is quiescent. Think hard about that.
Silver has been ice cold lately. But I suspect that will change shortly. But now, at the beginning of the summer doldrums? Sure, if what they are saying over at zero hedge is true. There will be blood on the streets in China, after the full story of the warehouse rehypothication fiasco comes to light. They are allready closing their hedges on the futures markets, buying futures to zero out the short side protection on all that phantom long gold and silver in their empty warehouses.
 

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dpong

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OK. I was an admin on the old GIM site. Never on this one. Just to be clear and truthful. :cool:
 

dpong

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Shortstack, I like it! Thank you for the empirical data point!

Watch the sentiment as well. Nobody rings a bell. BWTFDIK?

Silver has been ice cold lately. But I suspect that will change shortly. But now, at the beginning of the summer doldrums? Sure, if what they are saying over at zero hedge is true. There will be blood on the streets in China, after the full story of the warehouse rehypothication fiasco comes to light. They are allready closing their hedges on the futures markets, buying futures to zero out the short side protection on all that phantom long gold and silver in their empty warehouses.
 

dpong

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Oh, should you buy in the summer doldrums, or sell?

I'm not pumpin', I'm just sayin'. My technical analysis doesn't show me any promise for silver. My gut sort of does, but with a medium to long-term horizon. Not saying it is the bottom, but it feels cheap given the inflation numbers I'm expecting to see in the not-too-distant future. Once everyone digests inflation numbers, it won't be the bottom anymore.

As stated, best of fortune and luck to you and yours,
dpong