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** Market Conditions Alert
**
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The monetary metals pulled back
sharply yesterday but have entered Tuesday on stable footing. Silver
is trading at $29.90 -- and gold
is $2,674.
The ongoing volatility is a reflection
of uncertainty in the gold and silver markets globally, including fears of import
tariffs from the incoming Trump administration.
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If Trump slaps a tariff
of, say, 10% on precious metals coming into the U.S., that would have a huge
impact. 10% on silver would amount to $3 per ounce!
As a result of this worry,
the price of gold and silver – as traded on the New York futures market
– has risen sharply above the prices for the same metals seen simultaneously
in other markets across the globe.
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In silver, for
example, the spread between London spot and New York futures has recently reached
as high as $1 per ounce!
This spread has also created
a big incentive for parties all over the world to get their gold and silver into
the U.S. before any tariffs are imposed.
Traders are buying metal in
London, simultaneously selling in the NY futures market (and pocketing a tidy
profit), withdrawing the metal from London vaults, and transporting the metal to
the U.S. to deliver onto the exchange to close out the futures position.
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This dynamic is having the
effect of draining London vaults of gold and silver at an unusually fast rate --
and at some point, these lower levels of vaulted metal in London could create
price dislocations in that major market too.
Those who have short
positions in the New York market are in the process of getting squeezed,
especially if they are having trouble getting their hands on physical metal to
deliver into their short positions. Or get it into the right form.
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| This situation could
lead to big price swings and even a major short squeeze event in gold and/or
silver, so you can be confident we'll keep our customers updated at MoneyMetals.com.
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Other Great Options to
Consider
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record is excellent, investment markets have inherent risks and there can be no
assurance of future profits. You are responsible for your investment decisions,
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by your investment decisions, nor do we have any claim to any market gains you may
enjoy. Money Metals Exchange is not a regulated trading ???exchange??? as defined by
the CFTC and the SEC.
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