Silver Plunges On China Slowdown Concerns, Dollar Short Covering

Tyler Durden's picture

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Sokhmate's picture

I for one, am happy with this silver plunge.

It means that I will be able to, how you say, dip the buying fuck or some such

knukles's picture

Yes as Russia we saying goes.

Lucius_Junius_Brutus's picture

Can anybody explain to me in plain english what the f**k just happened? I thought the precious metal market was driven up by inflationnary pressure? What could/have produced such a drop?

Lucius_Junius_Brutus's picture

So you're saying this is a return to the status quo ante? No more silver apreciation? How come? There isn't enough silver to go around, why would the price drop?

flaxpin's picture

Trader games.  Don't trade it, buy some ozs.

JLee2027's picture

Did a new silver mine with 1 trillion ounces just appear? Did the Bernank find a way to turn paper into Silver?

Fuck no. 100000% manipulation. Buy physical from APEX while you can at these prices. 

Lucius_Junius_Brutus's picture

As a matter of fact I can see the chairman trying out alchemy, after all, even without a funny hat he is still the only man I know who can make gold price shoot through the roof with sheer words. Harry potter can suck up his magic wand.

KinorSensase's picture

don't get shook...ain't no such things as half-way crooks

qussl3's picture

Silver and Gold unfortunately are still priced in the paper markets, where shenanigans are commonplace.

Try finding any dealer willing to sell you at spot today.

Speculate in paper, save in physical.

Lucius_Junius_Brutus's picture

So you're saying that the drop is a move by big players to buy the dip? Am I getting that right? How can you enginere such a thing? (clueless frenchman trying to get it, sorry).

qussl3's picture

Cant make a judgment about anyone wanting to buy a dip.

This monster move comes on the heels of a massive margin hike from MF global after markets closed on friday, I wouldnt in the least bit be surprised if ALOT of levered longs got taken out today.

Furthermore this week is one where a number of asian markets will be closed as well as the LBMA on monday if i recall, thin markets on the back of huge margin hikes equal a perfect opportunity for paper games.

As others have noted, unless there is corroborating news out of the EU about massive restructuring or a Chinese faceplant, BTFD.

But as you have witnessed, keep leverage in check, silver is a tiny market which is begining to attract HUGE interest, it will be volatile.

This may just be a portent of things to come both on the up and downside.



Gunther's picture



to bring the market down a big player sells paper-silver up to the point where there a no more buyers. Then the price drops a lot to a level where some big buying is.

During a thinly traded market this does not take too much money.

Everybody trading on margin gets a margin call and has to sell (or put more money in the account.)

If the plot works out, the seller can buy back the paper-silver at a lower price then he sold and pocket a profit.

To call the bluff of the paper seller someone else could buy real silver bullion at spot and take delivery.

Those games are nothing new in the silver market; if anything is remarkable the that that the games did not happen for a while.

To read about the action at the Paper-Silver-Market Harvey Organ gives a daily overview on his blog.

I hope that explains what is going on.

Keri at Bankster Report's picture

Also, Lucius, silver isn't for the light-hearted, unless you're the light-hearted who doesn't look everyday at spot prices.  Don't try to time this market.  If you dig silver for the long-term, then an 8% dip is a chance to get 8% more silver.  As far as dumping orders to try to "engineer" a lower price at which to buy the orders back: it works with naked moves better than actual moves, but either way it really only works if you're buying it back at a level lower than where you got it in the first place.  If you bought silver at $41 and tried this stunt, resulting in a drop to $42, then you are SOL.  This is not the kind of thing someone/inc who got it under $42 would be profitable executing, which limits the culprits (if that is indeed what happen, which I don't think it is) to traders who bought last week.  I think it is unlikely, personally.  I like the forex cover idea much better.

Keri at Bankster Report's picture

unintended "503 unavailable" related double post

nmewn's picture

The drop is valued in fiat...they took a paper fiat market from a 32.65 ratio up to a 35.35 as I type...they are desperate for physical silver in the paper market.

If you have someone, as I do, who has agreed to, as he said..."not nick you both ways" and trade straight up, holding physical of either is not a problem...its correcting faster in fiat than I can type this out to you at any rate...LOL.

Take physical delivery and sleep well.


mrcybermac's picture

Seems like it's probably related to a(nother!) pending CME margin hike. (article on  Everytime there is a margin hike it flushes out some of the speculators who have no intention of taking delivery.  I saw someone comment that by the time silver is 75$ margin may have been hiked all the way to 100% making it a cash only market... interesting idea.  Whatever is happening, it's not a change in the fundamentals.

scatterbrains's picture

If I'm a large dealer in physical silver and the paper criminals decide to play games and push the paper price down 20% I'd just shut the sell window down for a bit, especialy if I know how hard it is to stay stocked.  I'm hoping that silver breaks free of it's paper chains  at some point because of these antics.

Rome is burining's picture

A fat finger is way more rational than a bubble at this time.  The drop was the result of a concerted efforts of gubberments trying to once again suppress the prices.  Hold on - physical can't be papered over for any extended period of time.

SME MOFO's picture

its been a wierd morning, i was trying to figure out what you were saying and then i realized i read undergarments where you said gubberments

Al Gorerhythm's picture

I don't get this . thing as a reply. Can someone please expand?

Quinvarius's picture

Obviously someone had some silver to sell and didn't want a profit on it.  That is how the paper silver market works.

razorthin's picture

Time to make a shitload on some AGQ put writing

DaddyO's picture


Friday would have been the day to do that don't you think.


razorthin's picture

Selling puts, not buying.  Should be some nice premiums in the morning.

topcallingtroll's picture

Exactly, but be careful.

I am tempted to lay in a put spread at some point.

Saucy-Jack's picture

Smackdown bitchez.....

cxl9's picture

No problem. When is Bernanke's next speech?


penisouraus erecti's picture

haha - you wish. for those of us buying since the $12-$13 levels it's not too upsetting. Good thing there's not much manipulation in this market though.

let-them-eat-cake's picture

Fundamentals: Try taking a wee peek at them.

akak's picture

Johnny come lately silver bugs being pounded hard tonite.  Told you all this was coming and you all chose to junk.


Die silver bug, die!

ThunderDumbass, repeat after me:

.... only $5 to dig from the ground ....

.... only $5 to dig from the ground ....

.... only $5 to dig from the ground ....

.... only $5 to dig from the ground ....

.... only $5 to dig from the ground ....

.... only $5 to dig from the ground ....

.... only $5 to dig from the ground ....

.... only $5 to dig from the ground ....

.... only $5 to dig from the ground ....

.... only $5 to dig from the ground ....

.... only $5 to dig from the ground ....

.... only $5 to dig from the ground ....

.... only $5 to dig from the ground ....

.... only $5 to dig from the ground ....

.... must ..... silver ..... owners' ..... brains .......


MGA_1's picture

Same same market that almost pushed silver to $50 last sunday is now down $5 in a heartbeat?  Hmmm... looks like a fat finger found the access market.

razorthin's picture

They call these gifts.  Equity investors should be so lucky.

Shock and Aweful's picture

I know what I will be buying tomorrow morning....if this holds out that is.

Bicycle Repairman's picture

Somebody made a mistake that they'll regret tomorrow.  BTFD, if you can find any.

jerry_theking_lawler's picture

que the trolls.....they seem to always be lurking, ready to pounce at any moment...if trolls can pounce....

Korrath's picture

I'm cannon-balling back into this pool tomorrow morning.  A gift re-entry point like this should not be wasted.

SME MOFO's picture

I dont care who you are, its always hard to man up and buy into a kick in the balls like that.  MF global is fucked beyond repair all trading screens blank. 

lynnybee's picture

yea, well, i'm an old woman & i'll be at the coin guy's door when he opens tomorrow !!   thank god, i've been praying for a smashdown .    & if it's lower on Tuesday I'll be back there buying a few more silver eagle bulloin rounds ........... i learned a whole lot on this ZEROHEDGE website !

SME MOFO's picture

you seem like a nice lady.  I'm trying to buy a new car with a one lot in 10 minutes.

SilverBaron's picture

You might not get that chance, it's already coming back up.

topcallingtroll's picture

A coin dealer wont mark down his product unless this is sustained. or CNI is your best bet because they run a hedge book and try to stay exposed just to the spread.

Bastiat's picture

They can't stop the squeeze coming from the physical side but they can make sure very few will get to ride the physical market's coattails, levered through futures contracts.  Anybody with a stop, got hit on that one.  And they'll keep raising margins.   But I don't think they will shake much physiical loose.

JLee2027's picture

If the large buyers were watching silver from the sidelines, you can bet tomorrow a lot of them will be jumping in the pool. Bubble my ass.

max2205's picture

This is going to get uglier real fast

Moe Howard's picture