Market Curiosity: Exploring Markets And Systems

February 21, 2011

LBMA’s growing backwardation could mean silver rising for at least 14 more days

Filed under: Just Watching — Tags: , , , , — Jeff Fitzmyers @ 7:58 am

IF the speculation of this LBMA backwardation being a fractal of 2008’s backwardation the current backwardation should last at least 7*** more trading days, and silver price continue rising roughly another 7 days after that. Minimum price targets are 37-42 $/oz, unless silver gets rowdy. In that case price could go much higher.

*** Every day that the LBMA’s backwardation goes more negative, adds a day to this number.

James Turk: The fact that arbitrageurs are not pouncing on this huge bakcwardation is just further evidence of how little physical silver is available.

Update: I just realized that the speculated days of price rising will get us past the Feb 28th first delivery notice. If the front month longs are not willing to sell, surely fireworks will result one way or another.

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