MoneyShow/Clif Droke/8-18-2022
“Recent CFTC Commitments of Traders (COT) reports reveal that commercial hedgers (the so-called ‘smart money’ in the silver market) are at one of their lowest levels of holding short positions in years. (See chart below.)… Moreover, [the Silver Institute’s World Silver Survey 2022] predicts total silver supply this year will exceed 32,000 tons, not enough to match the more than 34,000 tons of silver demand projected, leaving a market deficit of around 2,220 tons.”
USAGOLD note: Though the price of silver has declined steadily throughout the summer, demand has remained extraordinarily strong. The sky-high premiums on modern silver bullion coins – notably the American Eagle now trading at a more than 70% premium – testify to that demand. Analyst Clif Droke now thinks the silver futures market might play a little catch-up. Droke also points out a notable decline in the LBMA silver stockpile now at its lowest level since 2016. The last time LBMA holdings got this low, the price rallied 17%. “Putting all the pieces together,” he says, “silver’s outlook is as positive as it has been in recent memory.”
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