Loading ...Unresearched call buyers in precious metal ETF’s are never ‘smart money’. They are either flukes, insiders, or idiots (most are idiots), which is why 95% of options expire worthless. And the current set-up in the markets is classic set-up for a status quo result as the quadruple options expiry approaches yet again. (the influence of options on the trade gets stronger as expiry approaches) Thing is, not many follow the ETF gamblers betting distributions — they just gamble. So there better not be any good news over the next three weeks or the broads will be squeezed higher with a vengeance (because the put / call ratios are high again) and precious metals attacked once again.
How anybody can place leveraged and deteriorating bets under such conditions in the big casino (where the house always wins) is beyond me.
But I’m not addicted and I’m not playing with other people’s money in a hedge fund. Thing is, the funds make small bullish bets in precious metals derivatives every month labeled insurance — this is why these idiots keep coming back month after month and year after year no matter how many times their positions expire worthless. Despite the fact they are tiny bets for these funds, they are big enough to drive the consensus, and they always bet long — and they always lose. They win in the big picture because the other 99% of their portfolio will be fine as long as PM’s remain under control — and they can charge their outrageous fees.
This is why the sector remains in the crapper. And why PM speculators betting large percentages of their portfolios in this crap are broke — and could be getting broker if Trump backs off — which will be labeled good news faster than you can say — not again!
And there’s a good chance the lunacy does not end until they stop placing these bets in the ETF’s.
Cheers