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The silver story has changed radically over the past year. No longer are the big shorts capable of putting on major short positions knowing that they will get out with big profits. The biggest threat to the big shorts in silver is that investors seem to be awakening to the fact that silver is the cheapest commodity on the face of the earth. The only reason it is so cheap is because it has the largest concentrated short position of any commodity. However, with wider recognition of what a bargain silver is, we inch closer to true price liftoff. The violent price swings in gold and silver are caused by 8 large short sellers who are suffering huge losses. They are trying to reduce their short position and their losses. If the price of gold and silver keep rising, they can be overcome and bankrupted. If they are successful in reducing their short positions, that will set prices free. In either event, the price of silver will soar.
For investors, the trick here is to focus less on the immediate price bottom and instead focus on not selling too soon on the coming move higher. Pattern yourself just as JPMorgan has positioned itself – own as much silver as possible and keep a low profile.
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Ted Butler's comments on 1/18/2021