Submitted by: Francis Soyer
Yesterdays sell off in Silver as caused by a $1,000,000 dollar bet by COMEX (Crimex) that SLV would fall to $25.00 an ounce by July is the main suspect for the retreat. However, taking a closer look at this trade that went through something interesting to note. For one thing, half the daily volume were calls, and check out the total Open Interest (People Short This Downside Bet) This says that there are 3.2 million contracts betting against SLV would ever reach $25.00 By July. This is hardly a large bet that SLV will fall as described yesterday in the media. I suspect this may have even been a trade error. Or a larger player is using their weight to spin some headlines to get longer at a discount. The other possibility is that a trader on a desk probably fat fingered the key board when executing an order for July 35 Puts and his/her ass is grass today with the portfolio manager. It does happen unfortunately.
Symbol OptVolume Puts Calls AvgDailyVol OpenInt
SLV 698,162 382,221 315,941 228,700 3,270,383
Unfortunately by the time everyone figured out this was a bogus move down SLV this morning is already recovering thus eliminating the chance to leg in further at a discount.
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