ICYMI: Why Buy Silver Now?
Arcadia Economics SilverFix
Why I Just Bought Silver, and Will Buy It Again
Economic situation- China is in crisis, No Brics are buying
Vault situation- Shanghai Drainage
Metal Sourcing- Scrap is the game now
Technicals- Bearish below 23.21
Flows- CTAs are short and playing China
Gold- China buying
What was done
What makes the trade work
Last Week Recap:
The Basing Action- that will occur if Friday’s closing price is $23.76 (March future)
Bullish- Above 24.50
Bearish- A close under 23.21
1- Economic situation: China is in crisis, No Brics are buying
China will need to finally loosen the reigns and let the stimulus come. When that happens, you will see Silver up during China hours. will add then
2- Vault situation: Shanghai Drainage
Draining metal means taking it out, not buying it in China. This is a flow trade now, not a stock trade. The EFP will be a tell if we are near a bottom again
3- Metal Sourcing: Scrap is the game now
You cannot know what is going on behind the scenes. Price action now is encouraging longs of scrap to sell to Banks buying for China. When that metal is done being sourced, the market will change again
4- Technicals: Bearish below 23.21
Friendly above 22.80…
Buy more near…
5: Flows: CTAs are short and playing China
This is When CTAs get in trouble…
6: Gold- China buying will get filled
Physical markets trade to size, paper markets run away from them
-The Old Man
7: What was Done
8: What Makes this trade work?
EFP changes, CTAs get too short, Gold OI goes up on a down move
Risk: option premium delta