Monday, December 27, 2010

Funny Ha-Ha or Funny Strange?

Aren't the markets funny?
Seriously, wasn't it just 27 hours ago that the Chicom rate hike was supposed to rally the dollar and depress PM prices? Didn't a brainless computer dump some Feb11 gold at $1373 or so just last evening?
Here we are, one day later, and the USDX is smashing down through support and the metals are rallying. As I type, Feb11 gold is 1391 and March11 silver is 29.50. Wow! What a difference a day makes!
Take a look at this chart of the USDX:
It certainly looks now like we're headed back down to the bottom of thew recent range, down near 79.80 eventually. What needs to be watched, however, is that upward-sloping trend line I've drawn. A move through there and we will see another full point down day. You all are well-schooled enough to understand how a move like that will impact PM prices.

Last week, you'll recall that both metals ran into some price-capping resistance courtesy of Blythe and her monkeys. Expect the same this week, too, even with the holidays and the big east coast blizzard. Gold would need to move through 1393 and silver needs to best 29.60 before we can start getting excited. You can rightly assume that, as we approach those levels overnight or tomorrow morning, the EE will be waiting with all the fresh paper metal worthless fiat can buy.

The key will be what happens next. Will we paint another FUBM and blow right on through? Maybe, we'll see. But whether we blow through tonight, tomorrow or Wednesday doesn't really matter. As we discussed last evening, recent timing would suggest that the start of the next major UP leg in both metals is imminent, no later than next week. Blythe can lie, cheat, cajole and steal to her heart's content but the BoS is determined to break her and her position is untenable. She will lose.

Finally, Eric King posted a blurb on Richard Russell's gold opinion tonight. You'll enjoy it. Turd out.
http://kingworldnews.com/kingworldnews/KWN_DailyWeb/Entries/2010/12/27_Richard_Russell_-_We_Will_Have_an_Upside_Explosion_in_Gold.html

16 comments:

  1. Turd,

    I am also very impressed that crude oil is moving steadily upward - over $91 at last look.

    Sounds like the Turd trifecta of rising crude, falling dollar and rising PMs.

    I think it is just a matter of time for your predicted move up.

    Perhaps Professor turd can put a chart together with all three of those variables over time?

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  2. What a move for the dollar overseas, and nice chart there Turd. Dollar seems to be trending to the downside now. Where is support? When is the next POMO?

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  3. Mr. Hendrix,
    http://www.ny.frb.org/markets/tot_operation_schedule.html
    12/28 - $6-8B
    12/29 - $4-6B

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  4. Wow, just when I thought I saw flying monkeys on the horizon, it turned out to be hungry hippos.
    Bang!!

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  5. Oh, and I always look at gold vs. all currencies. The first move was most of them but down vs. aud and chf, flat vs. jpy. This last move was straight up in all currencies.
    And in the face of that turnaround in the buck.
    Yeah baby.

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  6. I saw endlessmountain on youtube do a video saying that he noticed after the last 3 peaks crashed, we had exactly 14 trading days and then on day 15 things broke out and shot up.

    Guess what today is? day 15. Looks like we may have a nice big ride to $32.50 or $33 and then down to $31 if the trend the EE is painting happens again.

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  7. Hey cmill, I think you may be on to something, you see that open?! Past 29.80 right out the gate...

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  8. Clockwork.

    Been buying gold maples and eagles on that 14 day schedule.

    It is going to be interesting when the equities rally finally takes a breather, if PM prices hold up, this may be the year that PMs go mainstream.

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  9. CAD and CHF have wood this AM.

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  10. The cuddly silver bears are back:

    http://www.fmxconnect.com/fmxmetalsconnect/post/2010/12/27/The-JP-Morgue-Whistleblowers-Are-Back.aspx

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  11. Would it not have been relatively easy for Blythe to draw the PM markets back down prior to the session? I wonder why she let it go this time?

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  12. WSJ trumpets some FUD (Fear Uncertainty and Doubt) about Silver. Must be time to buy more, then:

    http://online.wsj.com/article/SB10001424052970203568004576043820398067948.html

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  13. Heron: Maybe they're all stuck in snowdrifts, unable to get to the subway station?

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  14. May Be - Because it also looks like she did not maximize the impact of this morning's in session dollar rally. The markets are acting suspiciously free so far today.

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