Of Algorithmic Trading and Gold and Silver Price Manipulation
How algorithmic trading is being used to manipulate the silver and gold markets by inducing shakeouts in weak long positions.
by Dr Jeffrey Lewis
Mine Web
Orinda, CA (silver-coin-investor.com) –
Those who follow the day to day developments in the gold and silver markets have typically seen rampant market manipulation by large traders and bullion banks.
Although supposedly against the rules — and even being subjected to an ongoing investigation by the CFTC that now reaches into its fifth year — this market bullying is nevertheless allowed to happen over and over again without effective regulatory intervention.
Some of these big players even employ algorithmic trading systems to move into and out of the market faster than any human can. The transactions initiated by these computerized trading programs happen rapidly and often in huge size.
ALGORITHMIC TRADING CONTRIBUTES TO MANIPULATION
Despite these challenges, both precious metals have been able to rise over the last decade, so the real question is how high the prices of silver and gold would be if the market had not been subjected to recent downside price volatility?
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2012-12-16 19:47:07
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