Monday, December 6, 2010

New Record Closes in Gold & Silver

That is your headline today. Be very, very happy!

Gold and silver both "survived" some late-day, commodity selling and have even continued their bounce-back in the afterhours session. I have a Feb11 gold last of 1418 and a March11 silver of 29.96.

The chart I posted earlier looks conspicuously like an EE raid but I'm not convinced it was. All of the commodity complex experienced quite a bit of midday weakness. For example, crude traded back below $89 but it has since rebounded toward $89.50. EE attacks are always obvious when gold and silver lead the commodity complex lower. Today, they followed. Now, Blythe can certainly attempt to help things along but I sense she's a little wary of taking on new short positions here. In silver, there's nothing but daylight between $29.50 and about $33 (see chart below). Gold, once through 1426 should have clear sailing up to about 1445-50. Blythe may wait, fall back and regroup at those levels, especially with another $19B in POMO coming our way tomorrow through Thursday.

Ole Trader Dan posted this chart a few months back. I looked and looked but I could not find a better, long-term picture of the silver price. Thank you, Dan!
If you can read the fine print, note that there is no reason to expect any serious selling pressure, at least from a technical standpoint, until the price hits at least $33, maybe even $35. 

Be sure to check Harvey tonight as you now he'll be very excited and encouraged by today's action. Also, with each passing day, the delivery squeeze is getting more and more interesting.
I'll add more this evening once I get a chance to read Harvey, too.


3:45 EST UPDATE
Gold and silver have rallied sharply in the after-hours Globex session. Feb11 gold reached a new, all-time high of $1429.40 and is currently $1424.40. March11 silver tapped 30.36 and is now 30.22.
Obviously, things are getting crazier by the day and volatility will only be increasing. Be sure to keep your eyes on the prize, however. Most importantly, tomorrow through Thursday brings $19B or so in brand new POMO. Then, at 2:00 EST Friday, we get the release of the next POMO schedule that will last through mid/late-January and will most likely promise at least another new $100B or so in fresh cash. Until/unless something dramatic changes the landscape (think increased margin requirements), don't get spooked by price swings. The trend is UP. Strongly UP. Enjoy the ride.

37 comments:

  1. And...the miners just look fantastic. The "gold bugs index" HUI is having a huge, breakout day!

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  2. Yeehaw! Keep up the great bloggin', pard.

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  3. Turd,

    Love your blog and appreciate your writing style.

    As someone new to physical silver, I was curious about your opinion on the best silver to buy:
    A. Eagles/Maple Leafs
    B. Rounds (any particular company0
    C. 90% silver
    D. All of the above in some combination?

    I have heard some people prefer the Eagles to Rounds and they are easier for resale but if the intent is to hold long term does it really matter since silver is silver?

    Thanks for your input

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  4. "I have heard some people prefer the Eagles to Rounds and they are easier for resale but if the intent is to hold long term does it really matter since silver is silver?"

    That pretty well sums it up.

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  5. I agree with both of the last posts. It is more an issue of liquidity I think. Silver is silver, but you will find more buyers for your eagles.

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  6. WOW! What a day! The juniors are indeed on fire! If there is little resistance between here and $33-35, we could be in for another day or two of spectacular gains in the mining sector. GLTA!

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  7. aaaaand, both metals doing a vertical climb!

    gold 1424, silver 30.22. . . just felt like typing that for posterity.

    it's all lookin' good Mr. Ferguson, as per your calls! And thank you for the chart above, with your commentary it is all starting to make more "sense" to this admitted newbie.

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  8. General Alert: Please don't forget to Feed the Turd.

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  9. Thanks, dd!
    Please visit our advertisers, too, particularly Lind-Waldock. The get the Good Turdkeeping Seal of Approval.

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  10. This comment has been removed by the author.

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  11. Meanwhile over at EE HQ everyone left the building early as the day had proved a futile exercise to try to hammer down the Gold and Silver price and Blyth forgot to pay the Gas and Electricity bills and when she tried to pay by credit card it was refused as a JPM card and the power companies only take Gold and Silver cash payments now.G & S TO INFINITY AND BEYOND.

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  12. Got this link from a ZH poster. Interesting legislation on the Treasury's attempt to limit gold and silver coin production:

    http://goldandsilverblog.com/gold-and-silver-treasury-secretary-public-demand-0124/

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  13. Turd and others: thanks for the information...sounds like the Eagles/Maples should be purchased for the resale liquidity..

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  14. Am happy, still hungry. Blythe has to know her career is over. Same with Bernanke, Geithner. Today's move was epic! Equities crash AS gold goes vert!
    I still think we will test support tomorrow, but we will see. As far as silver, as I have said all year, I think we hit $36 by December 21st.

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  15. Well, these are working out pretty well:
    http://tfmetalsreport.blogspot.com/2010/11/amazing-week.html
    http://tfmetalsreport.blogspot.com/2010/11/moron-silver.html
    http://tfmetalsreport.blogspot.com/2010/12/here-comes-fun.html

    If you think we do fine work here, please tell all your "internet friends". I'd like to see just how big we can grow this thing. Thanks! TF

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  16. 90% silver coins are good in case the US Dollar drops dead and people revert to silver coins for commerce (a very real possibility when the completely clueless hold public office). Eagles and Rounds are fine, but harder to value in that case.

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  17. I am now getting very nervous. Of course I want this to continue, but do you think JPM (aka US govt) is going to let the PMs go crazy, threatening the USD/establishment/TPTB? I don't think so. We should expect radical new ways to limit or reverse the price rises, though I don't know what they might be. Remember what Harvey said on Saturday:
    "The bubble of shorts is so big that it cannot be covered."

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  18. blightpigeon, just weighing in an opinion here, with regards silver buying, I've gone with the Eagles as they will be "recognised" where I currently live, and will most likely be easy to trade in the future. . . I'd recommend checking ebay for the variety of ways silver sells, including 90% & silverware - it's a good way of keeping an eye on a "market" and understanding premiums, etc. best wishes!

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  19. Looking at the nice yellow (and heavy!)box I just picked up at the post office, Oh Canada!

    Just doing my part to bury JPM in the shorts.

    My first post here, thanks for doing the yeoman's work TF great blog!

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  20. @GG,
    I wonder if the way JPM will get out of this mess is to turn around and go long. I mean, if they KNOW the timing of when they release the weight of suppression, AND they have essentially the FED backing them up, couldn't they just turn on a dime and go long with a real significant amount of leverage?? Just a thought, but as the old saying goes, if you can't beat them, join them. If they could control like a light switch the end of PM suppression, and I think they can if they are the ones doing the suppression, they could make a real killing going long. Hopefully we will be along for the ride...

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  21. If JPM is already heavily short I don't see how they can turn around and go long in a meaningful way without driving up the price and further burying their short positions. They would first have to exit their shorts which seems to be causing them enough trouble.

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  22. Chris If JPM goes long that might help offset loses in their short positions but the balance of shorts would still weigh on the bottom line....Blightpigeon..always purchase silver in a recognizable form. How would a buyer know the material or content with it ?

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  23. For JPM to be allowed to switch from short to long PMs would mean the govt is allowing PMs to supplant fiat currencies. No govt will allow that to happen, as it strips them of their power. Yes, fiats all die eventually, but I don't think any govt has ever willingly participated in its own fiat's downfall.

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  24. FISD: Thanks for the link. I decided to investigate the prices of the NEW America the Beautiful 5 oz Silver Bullion Coins that were offered for sale recently and was BLOWN AWAY by the markup!!!

    APMEX got these from the Govt. mint at the sweet price of $160 and added another $120 to make them an outrageous $56 an ounce. Of course the mint urged them to keep the prices reasonable: http://news.coinupdate.com/keep-america-the-beautiful-silver-bullion-coin-prices-reasonable-0561/

    Talk about price gouging...

    Looks like they are asking $299 per coin on eBay!

    Too bad the mint realized how badly they botched it and I'm hearing rumors that the mint has STOPPED all deliveries to authorized dealers of the 5 oz Coins until further notice...

    This could get interesting! :-)

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  25. The best that the manipulators can seem to do is to keep the rate of price increase steady, so that the general public does not get all excited and jump on the bandwagon. Remember John Embry's view that gold is seldom allowed to rise more than 2% a day:
    http://www.sprott.com/docs/InvestorsDigest/2010/MPLID_042310_pg124Emb.pdf

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  26. Reputable and solid coin and bullion dealer from non other that Eric Sprott: sprottmoney.com

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  27. "Markets are more powerful than Governments "
    - Ron Paul

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  28. Turd,

    I know your view on fundos at the moment, but...

    I am looking at the 10yr weekly chart...we are at the top of the trend line...

    Makes no difference to me, I am not selling, but, is it different this time?

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  29. i think we would be in for a decent pullback here but that 30 # is such a powerful barrier and we just crushed through it and closed well above it today after turning down steeply mid day on second test. im cautiously ready to watch this bust on up to 33. nice time to be heavy long in futures w semi tight stops.

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  30. Hi Turd:
    I have alot of mining stocks... about 30% gold and 60% silver and about 10% energy and AG. Should I put a stop loss limit order on these so I can take profits in case of another "November 12th week type situation" or just let them ride through the volatility since the intermediate term will be up to 31-34 for silver?
    Thanks, Rich

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  31. http://www.resourceinvestor.com/News/2010/12/Pages/The-Scramble-for-Physical-Metal-Intensifies.aspx

    pretty interesting article on gold/silver backwardation

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  32. JPMorgue getting a hammering on the Silver anvil:


    http://jsmineset.com/2010/12/06/hourly-action-in-metals-from-trader-dan/

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  33. Rich: I really don't give specific trading advice anymore buy I will say this: trailing stops are always a good idea in this kind of market, just never for a full position.
    What I mean is, if you're long 1000 shares of something, pick a price 10-15% down and put in a stop for a 300-500 shares. Don't ever allow your entire position to get stopped out because, I can assure you, as soon as you're totally out the stock will reverse and you'll be pissed.

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  34. Nic: I hear ya on the 10-year chart but I would refer you to the answer I just wrote Rich. If you want to book some profits, go ahead, I don't blame ya. Just don't try to pick tops and blow out your whole position on a hunch. You'll just end up chasing to get back in and that's never a good idea.

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  35. Is holding AGQ a high-risk proposition based on their counter party risk. Is this a derivatives time bomb? I have some and the returns are stunning and addictive! I know that I am greedy, question is am I also foolish?

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