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Silver Drops Nearly 3% On "Lackluster" Chinese Demand

By admin 5 years ago 1094 Views No comments

Silver suffered a significant price drop yesterday. It went down almost 3% at one point during the trading session and broke its 50 day and 100 day moving averages.

Gold was also not unscathed in this most recent attack, although not suffering as badly as silver. Gold has once again dropped below the $1300 level. A price point which has been a constant battleground for those who wish to see gold move higher and those who are short the yellow metal.

Although silver took the brunt of the pain, it was able to remain above the import $20 level. Whether or not it can stay above this level will determine the short term outlook for the silver market.

The explanation for this most recent attack on prices comes from China, in which the reports have shown demand being lackluster as of late. But is demand truly as poor as is being reported?

Remember, the Chinese have recently made it much more difficult to track their importation of precious metals. The Chinese now have the option of importing precious metals directly through Bejing and not Hong Kong, in which it previously passed through.

This new method of importation does not require Chinese officials to properly disclose the amount the precious metals that are being imported into the country. A fact that the mainstream media has conveniently ignored.

Not only is it likely that these numbers are inaccurate, but the physical demand being reported by major mints also seems to defy these most recent reports.

In 2013, the US Mint experienced a record number of silver eagle sales, selling 42,400,000. In the first six months of this year, the US Mint has reported sales of 24,128,500! This puts the mint on track to meet or beat last year's figures.

Once again, it is quite apparent that this is just another example of the corruption and shortsightedness of those participating in the paper market.

Fortunately for those of us who are able to, and continue to accumulate physical precious metals on a month to month basis, this means that the metals are once again on sale. Keep stacking.


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