SILVER .... A winning hand

  Any long term winning poker player would tell you they don't have any particular style of play. Instead, they size up their opponents style and then craft a strategy (style) to defeat them. Consider the childhood game of Rock-Papers-Scissors. If your opponents style is to show up with scissors, well you need to show up with Rock. Winning poker is the same, in that whatever the opponents style - there is a way to defeat it. Human nature dictates we are all creatures of habit. Play poker in the same habitual manner, and the pros will eat you alive. This is why less than 2% of all active poker players are long term winners. The other 98% all habitually play a particular style (maybe tight, loose, agressive, passive, nitty, etc...) which is the equivalent of always playing scissors in RSP. Could u imagine how simple it is to defeat someone who always plays scissors?

  The investment arena is very similar to poker in that about 2% make the Lion's share of the money, while the other 98% are mostly losers. The reason is the same as poker, in that those who make markets design them to move in such a way as to defeat all strategies. You trade off the technicals, they will get you. Trade off the fundamentals, they will get you too. Trade off momentum, you are going to lose. Trade off charts, you have no chance. Markets move in a manner which Bag as many people on both sides of a trade as possible - once you understand that - improving your investment returns is easy.

  Consider the Silver Market..... In the last 2 years price has fallen from $48 down to its current $22. As a consequence, the momentum traders are piling on the short side. Those who trade off charts will tell you the Silver Chart looks Horrid. The technicals are all screaming Sell. Right this very moment, the COT structure shows speculators with record size short positions. With 98% of market participants believing lower prices lie ahead, which way do you suppose prices will head from here?

   Want more proof? OK..How about the few brave contrarians who rightly think because the silver price has been cut in half & it must therefore be a bargain at these levels. So they head to their local coin shop to buy some silver, where they are greeted with record HIGH premiums. Speaking as someone with decades of experience in the Physical Silver markets, the premiums you have to pay above current market price to obtain physical silver has never been higher, both in terms of percentage And in nominal price.

  As an example, All thru the 1990's Silver Eagles could be bought RETAIL for 40-50 cents over spot. Nowadays, the same silver eagles would run $5 over - if you are lucky enough to find them. The high premiums have the effect of turning away would be buyers, because almost nobody has both the conviction to buy silver at these price levels AND the willingness to pay the high premiums too.  Record high premiums, has the effect of keeping would be buyers from getting long - while at the same time welcoming sellers to market by offering those high premiums to them. So with a current market environment of openly welcoming sellers While turning away buyers there is simply no possible way prices could be headed lower long term.  Think about it this way .... if the silver market was headed considerably lower from here, the powers that be would price silver with record LOW premiums to make it easier for anyone who wanted to get long, to do so. Those low premiums, would also discourage sellers (who would think they are not getting a fair price relative to market) - keeping them long for the ride lower.

   So lets consider all the current ingredients....Momentum traders short. Technical traders short. Chart traders short. Bargain hunters punished with high premiums, while sellers are welcomed with open arms. With everyone on the short side the only possible way 98% of market participants could be on the wrong side of the trade is if silver prices are headed higher. The whole move lower (from $48 down to $22) is a Giant bluff by the powers that be designed to trap the 98% on the wrong side of the trade. Do what any poker pro would do, man up - call their bluff & get long. F*ck the premiums. End of story.