The market for precious metals is not so easy to understand, most investors are not familiar with its workings. In particular to understand how the manipulators are doing it to artificially lower prices.
If the law of numbers allows achieve this through huge short positions, there are other, sometimes illegal techniques such as « spoofing. » Here’s what it is :
Term that could be translated as « decoy », it involves placing a huge order to cancel it immediately without execute it. These orders have the effect of influencing other market participants and generate favorable price movements.
ZeroHedge, using data provided by Nanex, use to address these illegal operations which blithely blind eye the US market regulators, namely the CFTC. In direct address to it, the US economic iconoclast information website provided some evidence of spoofing on the gold futures market in June 2015 :
« Dear CFTC
It’s us again and as promised, we give you a little help in your quest to eliminate very serious illegal manipulation of our beloved markets. Today we provide three examples of spoofing on future gold which, as you will see, is not very difficult to identify as far as we make a little effort. (…) In each case no order has been executed, or a tiny fraction of the « decoy order » was. You can see how the course was influenced by the sudden appearance (and disappearance) of these XXL orders. «
All this is proof if need be, that markets are manipulated but they are with the blank check of regulators, who prefer to close their eyes to the evidence rather that intervening at the request of political power and / or financial.