In this tremendous article, James McShirley exposes a small but extremely significant portion of the ongoing metals price manipulation scheme. It is reprinted here with the expressed permission of Bill Murphy at https://www.lemetropolecafe.com.
This article was originally published back in late August and it's likely that some of you have already seen it. Regardless, the information and data provided by Mr. McShirley is so compelling that I wanted to bring it back to the forefront today. Please read this (again) and then forward it to any "ostriches" on your email list.
by, James C. McShirley
The advent of computer generated trading algorithms heralded a quantum leap forward in the quest for 24/7 control of markets. No longer were humans beings required to do such unseemly things as man trading desks or worry a whit if free markets were, if even infrequently, attempting to function. Algo precision has made even the blackest of black swan events seem to turn lily white in their utter non-eventfulness. No more significant Dow or bond crashes, and best of all, no gold rallies exceeding (exactly) 1.00%, or the occasional 2.00%. Algo sentinels now stand in a permanent state of vigilance, keeping MOPE alive. (MOPE is what Jim Sinclair refers to as "management of perspective economics".) Market manipulations and control of gold trading are what I have documented now for over 15 years. Many of these manipulations are well-worn, tried and true. Nearly all have intensified over the past 3 years. It seems as if one could throw a dart on a trading dartboard and hit an anomalous trading pattern nearly every time. Even with that said, I was stunned to stumble on to the biggest trading anomaly of all: the MOAMOPE - the mother of all management of perspective economics.
MOAMOPE is quite simply the stunningly high percentage of lower opens on the 6:00 PM silver access trade open. Perhaps some have noticed the oddity in the form of a Kitco 3 day chart.
Look familiar? It should, it’s happened 621 times in the past 3 years.
Virtually every evening for the last 3 years at precisely 6:00 PM EST something very odd has happened: Comex silver offers swamped the bids to the tune of a 3-10 cent decline. For this to happen for three consecutive weeks would be strange. If it were to happen for three straight months it would be bizarre. MOAMOPE can only describe when it occurs for three straight years. It's a veritable Algopalooza! Silver has had a near-iron clamp imposed on it commencing with the access trade reopen. How severe is this iron clamp? From September 1, 2011 to the present, 621 out of the 744 6:00 PM access trade opens have been lower. All manipulation denialists take note: that's an astounding 83.5%.
Legitimate hedging? Yeah, right. Ya think maybe deep pockets with algo sophistry?
The pattern is consistent, pervasive, and relentless. For 36 straight months not ONE month has had a greater number of higher opens than lower. Amazingly 35 out of 36 were between 80-95% lower, and the lone outlier "only" had 67% lower openings. The pattern was irrespective of rising or falling silver prices. From January 1st to February 28th of 2012, for example, silver rose $9.28, going from $27.86 to $37.12. That's a whopping 33% gain! During that time, however, 34 out of 42, or 81% of the 6:00 PM access trade opens were lower. It was a bull market in silver in the context of a raging bear market in access trade opens. The MOAMOPE was in all its glory!
Selling the 5:30 PM access trade close MOC and then covering 2-4 minutes after the 6:00 PM reopen has been a license to print fiat money for those willing to shadow cartel behavior. Even a 1-lot trade over 3 years could have netted someone $70-100k on a measly 3 cent scalp. The unusually high percentage of lower access opens is actually far worse than it looks, since the few higher opens for the most part faded as the evening wore on.
The trend of lower silver access opens has actually accelerated in 2014, with 134 lower openings vs. only 14 higher openings, a 90.5% probability. More recently 80 out of the past 84 have been lower, with the past 24 in a row having been lower. This despite silver being virtually unchanged from January 1st to the present.
Only 14 higher openings in all of 2014 - with silver virtually unchanged from Jan. 1!
There have also only been 4 significant gaps higher on the 6:00 access trade open since the beginning of 2013 - all of which quickly faded. Why the lockdown on silver? Why such extreme treatment for a seemingly minor commodity market? Why has silver been constantly bludgeoned to death with the CME’s margin hammer? Why the silence on such blatant manipulation? The only logical answer is that to NOT do it would be tantamount to disaster for “the force”, or the “resolute sellers”, or whatever the hell the polite crowd is calling it lately. Call me impolite, but I'll just call it the MOAMOPE.
Time researching the MOAMOPE: 20+ hours.
Satisfaction proving once more that manipulation denialists are disingenuous phonies: Priceless.
A denialist reporting on gold and silver trading.
James C. McShirley
August 23, 2014