Friday, May 6, 2011

05.06.2011



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END OF DAY OF REPORT


Who would have thought we would be wondering if the 200 day moving average will be support in the next week or if the $30.00 is going to hold up for us. What a week to say the least and if you are not on a severe yellow alert yet, you should be. People mention the shit hitting the fan scenario and it looks like this might be a piece hitting that fan. 300 million shares traded on SLV in one day is very alarming and the indications are now pointing to those moves I have been talking about for over a year now from 1979 where the up and down moves are wild. If you can get your hands on some, I think you are getting an amazing bargain if we are talking the physical metal. What scares me about lower prices if we break below $25.00 is actually getting the physical metal. On the way up to $25.00 about six months ago it was very easy to get these coins. The volume in real human beings going out and buying bullion is also rising large and not many are selling. Some will be shaken out right now and this is natural and temporary. I often times see delays in metals and just not having a particular kind even available. If the bullion dealers do not short the market, then they run the risk of selling at below cost or holding on to whatever remaining inventory they have. Bullion dealers like APMEX will short the silver market when they buy the metal and when you buy from them they would cover the portion you buy. This means they lock their commission in and direction would not mean anything to them. Therefore when you buy silver from APMEX you would force them to cover a portion of their short position. Regardless of the fact the disconnect would get very serious if it happens and the most likely scenario is the dollar collapse is starting and having money in banks now has higher risk than it did when April ended. Enjoy this ride and have a nice day.

Derek.

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