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Posted on 09/27/2025 11:37:10 AM PDT by delta7
Our headline chart shows silver storming ahead amid reports of backwardations and soaring lease rates. Will it continue, and will gold be next?
A graph of a line graph
AI-generated content may be incorrect.
Driven by poor liquidity, in Europe this morning silver was $45.03, up $2.00 from last Friday’s close. Gold was up a less spectacular $68 at $3750 on the week, but with a firm undertone.
In this report, we look at what is currently driving gold and silver prices higher, and whether it will continue.
The chart below illustrates the paper market problem with the silver futures contract.
A graph of blue and black lines
AI-generated content may be incorrect.
Having soared to over 184,000 Comex contracts by 17 June, open interest declined to 154,000 on 1 September. Meanwhile the price continued rising strongly to $40. A falling open interest and rising price can only happen in a vicious bear squeeze on the establishment shorts — principally the swap traders. But open interest stopped falling after 1 September, and is now rising because long speculators realise that precious metals are in a bull market and are joining the chase.
This is tightening the screws on the shorts, who must really be panicking. The technical chart shows a rare runaway situation, with no sign of stopping.
A graph of a graph showing the average of silver and moving average AI-generated content may be incorrect.
Additionally, investors are beginning to buy ETFs, putting further strains on physical liquidity, so higher lease rates and backwardations in London are likely to persist. And stand for deliveries on Comex, presumably going into hoarding hands amount to 10,842 tonnes so far this year, about 58% of global mine supply for nine months.
You read that right!
The problem is that instead of a rising silver price leading to profit-taking, it is likely to reaffirm the fundamental reasons for hoarding silver, which is to hedge failing fiat currencies. Buyers are still flocking to physical and appear likely to accelerate the pace of their buying in these extremely tight conditions.
This brings us to gold. Next up is the technical chart:
As is the case with silver, gold appears to be rising vertically. Again, investors have missed out on a major bull market and wondering whether they should buy. At the margin they are doing this by going down the ETF route. Furthermore, major US banks with trillions under management are now forecasting higher prices which are bound to put pressure on their investment managers who have next to no exposure to gold for their clients.
While the market for gold is more liquid than silver’s a similar situation exists, with 900 tonnes stood for delivery on Comex nearly all of which presumably is being hoarded. At the same time ETF demand is beginning to take off, putting further strains on physical liquidity. And as the chart below shows, there are similarities with the silver squeeze.
China and Bretton Woods 2
As a backdrop to problems in western capital markets, China has effectively cornered the physical market, and it now emerges that she plans to link her currency with gold for intranational trade settlement purposes. This is why the Shanghai Gold Exchange is opening vaults in Hong Kong and Saudi Arabia, as well as planning for yuan-gold exchange facilities elsewhere in SE Asia. This is sending a clear signal to other SCO and BRICS nations as well as the Global South generally that in a post-dollar world they will need gold reserves of their own.
Consequently, there are central bank buyers for all available bullion, which with growing ETF demand is bound to keep the physical supply side very tight.
At some stage, this gathering rush into physical gold and silver could slacken. Joining the herd of buyers are likely to be paper speculators hoping for a quick profit, and they will be shaken out. But that won’t change the underlying bullion shortages, which look like worsening.
The authorities will hope that it won’t lead to systemic problems.
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“AI-generated content may be incorrect. “
That’s a reasonable statement.
Last week was the most incredible week I’ve ever had.
I happened to check prices yesterday for the first time in a long time. I felt like Rip van Winkle.
My PMs are brass & lead.
“If you can’t protect it, you don’t own it.”
Last week was the most incredible week I’ve ever had.
It was fun wasn’t it? Better than a bass boat!
Maybe supply and demand? 56% of silver, only 10% of gold demand is for industrial purposes. Data Centers are the big deal right now. How much silver are in them?
You’d better hurry! 😀😉
,,, I started buying silver at $NZ38 an ounce, retail. At the time I thought it was quite pricey. Right now spot is $NZ80,25. Feeling good. My therapist is OK with my progress.
I have been reading about the paper manipulation of Silver since 2007.
I would love for it to soar to $250 an ounce. That would make for a nice Christmas for me. Not so much for the rest of the economy.
I bought at 17-19 USD
Why is it that financial predictions read like horoscopes? They say a lot but say nothing.
IBTG
Woohoo!!! 🎉🎉🎉
(They say a lot but say nothing.)
Are we talking about
Kamala Harris or
AOC?
Timmy Walz?
How’s this for financial predictions? USD down minus 11 percent YTD….Gold predicts with certainty.
Gold Price Performance USD
Change Amount %
Today +19.76 +0.53%
30 Days +324.98 +9.52%
6 Months +690.18 +22.63%
1 Year +1,086.52 +40.95%
5 Year +1,860.63 +99.00%
20 Years +3,277.46 +708.44%
goldprice.org - 17:15 NY Time
,,, winner!
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