#Silver - What Happened Today? The sharp drop in silver prices was simply due to a large influx of short positions into the futures market, causing a significant price decline. This conclusion is easily drawn by observing futures trading volume, but to further verify this, observing some interesting patterns is crucial. I noticed some very interesting patterns that confirm my argument: some short positions needed to be closed. This occurred today in both the Shanghai and COMEX markets: What exactly happened today? In the Shanghai market, I didn't see any noteworthy large-scale physical silver redemptions, meaning no physical silver changed hands during today's decline. So what happened? First, short positions severely depressed silver prices. Even in Shanghai, the futures market is backed by paper contracts, not physical contracts, a point easily overlooked. However, the SGE1! futures contract is 100% backed by physical silver bars. However, there was indeed some non-physical silver trading today: 531 tons of silver contracts were traded in the Shanghai market. This reflects the liquidation of short positions and their transfer to new long positions, with buyers entering the market while sellers closed out their short positions at a 10-15% discount to the opening price. There was no physical silver outflow today, which is not a bearish signal at all. This was a transfer of paper/spot deferred delivery positions, not the physical delivery many feared. Again, this is active trading in the derivatives market. Therefore, the structure of this trade is: first, paper positions were under pressure; second, short sellers used the decline to close out their positions; third, buyers absorbed all positions; and fourth, very importantly: there was no confirmed physical liquidation. In my view, what happened today was a shakeout driven by paper positions, accompanied by continued accumulation. COMEX data is always released one trading day late, so it is expected to be released on Monday, and we already have the Shanghai report, which conveys a clear message. Furthermore, the timing of this repeated manipulation at the end of the month is very intriguing. Just like on December 31st last month, silver fell by about 15% in a single day before rebounding. Guess what else happened on the same day: the Standing Repurchase Program issued a record amount of dollars to banks. And guess what? These banks were actively shorting silver. This data is publicly available on FRED and CME. There's a strong link between month-end lending for balance sheet purposes and the ability to massively suppress prices at the end of the month. This pattern is very clear and confirms my theory: banks are facing extremely serious difficulties, not only because of liquidity shortages, but also because the next risk comes from silver. This is one of the main reasons I predicted the financial crisis and stock market crash. I've been shorting silver for several months and have profited handsomely on multiple trades in PLTR, NFLX, MSFT, COIN, MSTR, and others, which have been ongoing for several months. (Premium members only :) However, the outlook for physical silver remains very bullish, with strong demand. I won't sell at $85, and I don't know anyone willing to sell their rare metal at that price. Monday will be a very noteworthy day for many reasons. The US market closed at $84, while the Shanghai market closed near $122. That's a historic 44% price difference. On Monday, dealers around the world will need to decide at what price they are willing to sell physical silver. I remind everyone that physical silver has been selling for between $120 and $130 in recent weeks, even reaching $150 in Tokyo, and most dealers' inventories are sold out. Why would dealers lower prices if demand remains constant or even higher? The key issue is that Shanghai and COMEX need a safe exit point for short positions, and I believe the answer will be revealed in the coming weeks. Therefore, my conclusion is: the purpose of this move is obvious. The market has realized that silver is in a strong bull market, and the shorts are beginning to crumble. I remain very bullish on silver, just as I was at $20. We have already reached my target price of $100.