This week has been the most volatile week for commodities all year, with oil back below $100 per barrel, gold under $1500 an ounce, and corn and wheat retracting to April prices – many traders are pondering the direction of the commodity market.
The most active amongst all is silver, free falling Monday to Thursday from $50 to 32 an ounce, a loss of nearly 40%. This was perpetuated by several events. The biggest perpetrator was the continuous bump up of margin requirements by the CME. Many traders who were holding contracts with narrow margins were either asked to close positions before reaching the new limits or woke up the next morning discovering they had positions closed for them.
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