Silver prices got a bit of a jolt this morning when spot silver had yet another so called ‘flash crash’ and fell by between 7% and 10% before recovering and bouncing sharply higher to not far below where the attack on the price began.
In a repeat of what happened to gold last week, a bout of massive selling hammered silver prices lower momentarily. Having hit an early session high of $16.18/oz, the spot silver price fell from $16 to as $14.82 in less than a minute. The price recovered as quickly as it crashed, rebounding to $15.89/oz.
Source: Thomson Reuters via Business Insider
This isn’t the first so called ‘flash crash’ silver has seen in the last month. It fell in tandem with gold’s 1% ‘crash’ on June 26th, by 1.3%. Prices did not rebound as quickly, silver has declined by nearly 3.7% between then and July 6th.
Yesterday silver appeared to be on the road to recovery having climbed 0.5%.
Many analysts are calling the flash crash a ‘trading error’ or fat finger.’ However, this is somewhat lazy and ignores a few pertinent facts and context.
The aggressive selling had all the hallmarks of market manipulation as $450 million worth of silver futures were sold in a minute. An entity appears to have wanted silver lower and the massive sell order achieved that goal.
