Comex's biggest silver short is suddenly absent ... and silver breaks out.
Coincidence? I think not.
In comex silver trading this week 684 new contracts (3.4 million oz) were written and 704 delivery notices were issued. News flash: NONE of those delivery notices were from the HSBC “customer” account that I have been calling out for more than a year.
This HSBC account issued 94 delivery notices (470,000 oz) on first notice day for the May contract (May 29). Since then they have not sold any silver. This is far below the average 5.5 million oz per month they have issued over the prior 18 contracts.
This HSBC account has sold over 100 million oz of physical at comex since December 2023. That metal has accounted for nearly a quarter (23%) of all physical silver sold at comex during that span. In some months HSBC’s metal accounted for more than half of all physical silver transactions.
Since a good portion of the total delivered silver is just bankers flipping metal back and forth to each other, the real impact of this HSBC account is much more than a quarter of the market. If bankers flipping metal account for half of comex deliveries, then this HSBC metal would account for about half of the non-flip transactions.
Based on my tracking, all of the metal sold by HSBC was brought to comex from outside the comex system. And all of that metal was brought in via 2 vaults … Asahi’s vault (79 million oz) and MTB’s vault (22.6 million oz). Furthermore the Asahi vault appears to have been set up solely for this HSBC account taking its first deposit in mid 2023. That is an indication of the depth of planning by this HSBC account.
After observing this surge in trading by an account called Hong Kong Shanghai Bank Corp, in May 2024 I advanced an idea I called “The Differential Lag Theory”. Basically, I suggested that an account was accumulating silver at non-price setting venues and dumping silver at the price setting venue (comex) in an effort to accumulate silver at a depressed price.
Is the silver dump over? I’ll hold final judgement until first notice on the upcoming July contract, an active month. That will confirm or deny my suspicion.
Many times I have wondered out loud what the silver market would do without this huge dump of physical. This last week of trading may be a preview of things to come.
Good luck finding commentary that is as fact based as my analysis. Hit the button below and also help spread the word on X or other media. I want to take these jokers down as soon as possible.
Thanks Michael for another great update. You are right to point out that verifiable analysis is almost non-existent. For the most part, we have to rely on anecdotes, because the real information is kept hidden.
From people I have been speaking to, the emerging picture is that China has indeed been the major seller for the last couple of years but China holds silver as a strategic asset and currently is believed to hold over 50,000 tonnes.
So why did China want a low silver price? Solar panels! Each panel contains 0.6 oz silver and silver is the biggest variable cost in manufacturing a panel. You can't have cheap panels if silver is expensive. So China was protecting its solar panel industry. We all know there has been excess demand for the last 5 years, without an active policy of holding down prices, China's solar panel industry would have been threatened.
Why did China stop holding the price down 2 months ago? Tariffs! What is the point of holding down silver if Trump is going to have a 150% tariff?
What we have seen in the last 6 weeks or so, has been off-loading of silver bought in anticipation of tariffs. That has now all been sold, so there is no downward pressure on silver prices.
This really could be the start of a long term uptrend in silver prices.
This very well could be the tipping point into The New Paradigm Shift and a potential resetting of the Silver price away from the LBMA and COMEX forever. Game over!