Sunday night silver market experienced a thrilling short squeeze drama.

The key players in this event are very clear: on one side is the giant market maker in the international precious metals market, JPMorgan Chase, and on the other side is a major European bank holding nearly 5 billion USD in silver short positions, with trading taking place at the New York Mercantile Exchange.

The story goes like this—early in the year, market makers began to heavily accumulate long positions in precious metals. Gold prices surged from $3,000 to $4,500, and as the price kept climbing, the short sellers started to get uneasy, entering the market to hedge and attempt to cut losses. This is standard market operation, nothing unusual.

But here arises the first key question: why did the market maker choose to initiate a short squeeze in the silver market instead of gold? The answer is quite revealing—gold markets have ample liquidity, with many participants including central banks from various countries, so even the most powerful market makers can't manipulate the price. In contrast, the silver market has comparatively thin liquidity, making it a perfect hunting ground.

JPMorgan Chase clearly saw this early on. They set up their trap in the silver market in advance, waiting for the short sellers to step in.

The critical turning point occurs at the New York Mercantile Exchange. This is the real information black hole—the exchange’s backend has complete order data. In other words, market makers can see the short sellers’ cards clearly. With this intelligence, JPMorgan Chase’s next move becomes much easier: violently push up the silver price in the short term to directly blow up the short positions.

The situation quickly turned dire. The NYMEX issued a final ultimatum to the European bank: deposit $2.3 billion in margin before 2 a.m. This is no small sum. The European bank began to seek help from the market, planning to sell assets to raise the money. Ironically, as if prearranged, no buyers appeared. At 2:07 a.m., the bank announced it could not meet the margin call. At 2:14 a.m., the NYMEX began ruthlessly liquidating its silver short positions.

The price movement of silver perfectly illustrates the entire hunting process: initially soaring to $87 during Sunday night trading, then crashing down to $70. The short squeeze was completed, and the prey was caught.

What’s worth pondering about this story is not only the event itself but also the market reality it exposes—there is a huge power disparity between abundant liquidity and scarcity. In markets with thin liquidity, large funds wield near-absolute control, and the fate of small players is often silently decided.

What do you think about this classic sniping?