Max Pain For Options Trading On Dec 2010 Silver Futures

December 2010 options expiration day for gold and silver futures is on Tuesday, Nov 23rd 2010 (2 business day away).

How things are looking after Friday, Nov 19th 2010 business day ended, you can see on the following image.



Max pain for option trading with Dec 2010 Silver Futures is at $25 and last settled Dec 2010 Silver Futures price is at $27.18

If banksters don’t create a small miracle to drop price of silver below $25, this will indeed be max pain for them on Tuesday, Nov 23rd 2010 at 1:30pm New York time.

Especially, since currently there are 48,991 open interest contracts which equals demand for delivery of 245 million ounces of PHYSICAL silver.

Also interesting info is that Comex reports that their silver warehouses, in last 30 days reduced amount of PHYSICAL silver (they hold to deliver silver to buyers of silver options and futures), by more than 4 million ounces.

And this happened in months – October and November, that are not even delivery months for silver.

Some clients are in a hurry to get their physical silver (before others demand delivery in Dec 2010) and are taking silver out of Comex already this month.

What do you think will go on at Comex warehouses in Dec 2010 that is a delivery month for both PHYSICAL silver and PHYSICAL gold?

http://agaupm.com/max-pain-for-options-trading-on-dec-2010-silver-futures/
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4 Comments to “Max Pain For Options Trading On Dec 2010 Silver Futures”

DayStar says:
November 21, 2010 at 14:56

AgAuPM, if max pain for the bankers is $25, and we closed Friday at $27.35, wouldn’t the bankers be better off going long on the margin and driving prices up so they can make money on the spread? If they try to drive it down, there are sovereign wealth funds buying on the dips. There is resistance at $25, OI has shown it is mostly in strong hands, and wholesalers are already experiencing shortages of silver.


AgAuPM says:
November 21, 2010 at 15:49

@Daystar – it’s not in banksters interest for price of silver to go up since then they have to deliver physical silver to call buyers that are “in the money”.

Paper money is something banksters have or can print more but physical silver they can’t print and would have to borrow or buy somewhere.

Now, if price of silver will go up or down this following week is a mystery since we have a battle between a side that wants silver to go down (banksters) and a side that wants to crush banksters (speculators).

Who will win silver price battle this week is something no one can predict today since so many are involved now in this paper silver market.

Let’s just wait and enjoy silver action in coming days.

*****

Irv says:
November 21, 2010 at 15:49

Welcome back AgAuPM. I was in Thailand a few months ago and there were gold shops everywhere. People there use gold for jewelery as part of their culture.

On the silver side, it’s looking to shape up to be a default at the Comex. If this occurs, I’m guessing we are going to get overnight parabolic moves? Could December be the month where triple digit spot price occurs due to a default? Hmm


AgAuPM says:
November 21, 2010 at 16:05

@Irv – it looks like most if not all Asia likes more physical gold than paper currencies such as USD, GBP or euro.

If only other continents would think same as them.

The only way Comex would default, would be if call buyers would start to ask for delivery of physical silver instead of doing rollovers on futures contract and accepting premiums to be paid in USD instead of demanding physical silver.

Until this shift in trader’s mind occur, Comex will keep on doing what they do the best – selling paper silver and gold derivatives plus naked shorting.

Anything is possible but I don’t expect this scenario to happen already next month.

As we saw, on Nov 9th 2010 when price of silver was speeding towards $30, they increased margins for silver futures trading and when price was falling they did the same thing on Nov 16th 2010 (probably to keep it below $25 until option expiration day on Nov 23rd 2010).

Dan