Wednesday, December 22, 2010

Wednesday Wrap-Up

All in all a pretty quiet day today, as you'd expect for December 22nd. Absent any news, tomorrow will be even more quiet and with a tighter range. Of course, we've all grown to expect the worst from Blythe and The Monkeys so don't be surprised if she stages another early morning raid tomorrow. She could whack $10 out of gold and still make it to Macy's before 10:00 for some last-minute shopping. If you think I'm kidding, you obviously haven't been hanging around this blog very long. Expecting Blythe to show a little decorum and not blast away two days before Christmas only makes a raid more likely. Just because we are all dug into similar trenches, don't expect a ceasefire. The likelihood of an "All Quiet on The Golden Front" lovefest is pretty remote.

Here's a picture of our quiet gold market today:
Silver looks almost identical:
The only real interesting development today was the possible breakout in crude oil. Looky here:
Today's close above $90 is significant. IF we get a close soon above the intraday high of 12/7 at 91.17, we've got trouble in River City. Not for us PM bulls but for the other 99.98% of the general population. In conjunction with all the other rising input costs, rising energy confirms that price inflation...serious price just around the corner in 2011.
When I sit back for a moment and consider the truly perilous, disastrous situation the blasted fools at The Fed have put us in, I get extraordinarily pissed off and you should, too. These MFers have set us up for tremendous hardship and civil strife, perhaps even civil unrest, all in the name of endless money-printing and TBTF banks and government services. 2011 is going to be a very hard, very mean year. Please prepare now. Tell all your friends, too.

On that happy note, I'll sign off for now. The Fergusons have some friends in town for a little  pre-holiday cheer so I most likely won't check in again until after I see Harvey's nightly update. I'll probably be more than a little "in the bag" by then, if you get my drift, so in advance, I must ask that you please excuse any misspellings, poor grammar or assorted expletives you find in my late evening update. Turd out.


  1. Turd,

    Minor correction: CL closes at 2:30 EST.

    Real fireworks are happening now :)

  2. Thank you so much for your blog.
    Question regarding the silver manipulation. Is there anything that keeps TPTB from dropping the price of silver in small increments over the entire day? It seems that this would at least mask the blatant manipulation evident by the huge daily downward spikes.
    Thanks again.

  3. It has been eerily quiet today . . . very unusual behavior. The only explanations so far is that there was no meddling by the EE and BoS waited all day expecting dips that never came. We have to keep watching it closely. Something is clearly up.

    @Matan Abel: When EE raid the market, it wipes a lot of longs in process as it creates a lot of margin calls and/or stops, thus further accelerating the intended movement. The slow increment decrease would be much easier absorbed by the market. The whole point of raids is to create the downward pointed mini panic. As of late, they werent as successful even with big raids.

  4. I was expecting a much more significant correction and am disappointed. My view is that this PM bull market would benefit from a test of support at $1350 or even $1260. Also, you would think that PM traders (asian, hedge and JPM) would actively encourage a lower base for their own gain (whether to dispose of shorts or buy physical). For this reason I continue to place a question mark over this market. Why continue to chase up to $1400 when you can buy cheaper at $1350?
    We have tested the 50DMA and thats all???
    I note Hamster's change from short to long.
    I note the tape continues upward despite short pressure.
    We all know that this market is manipulated.
    One last stretch to $1400 before a much larger correction???

  5. @Selfish Man: Thanks for the response. Do strong upward spikes have the ability to create the same but inverse upward "raid", or just as unsuccessful as the downward ones?
    Have been trying to understand the charts a bit more. I might as well considering I check them like a rabid animal.

  6. From my understanding (and i am not very technical in this area), the large shorts (JP Morgue and such) have deep pockets (courtesy Ben Bernank) that allows them to keep their short positions or even cover them at a loss. The question that needs to be asked is why they have such large short positions? The speculative answer is that they are trying to prevent PM's from appreciating too rapidly as it would expose the result of their abysmal monetary policy (inflation fraud) orchestrated by the Fed. Thus we have a notion that the Fed and the TPTB work in unison in commodity markets (specifically in gold and silver)

  7. The McClellan Market Report still has the first week of January as a major cycle low, but they've added another low for about Feb 8, which they say should be brief but potentially nasty. This raises the issue as to which is the actual 13.5-month cycle bottom. To me, it's not a big matter. I intend to put the majority of my PM funds to work in early January and save the rest to buy in early February.

    As I noted in an earlier post, the oil surge is a reflection of the surge in gold prices 4 months earlier, and will continue through January.

  8. Don; Thanks for reporting the McClellan figures. They have worked well in the past.

  9. Glad you mentioned the oil price as being positive for PM holders. I'm of the view that if you look down at a gold coin in the palm of your hand you are really looking at the tremendous amount of embeded blood, sweat, tears, and energy that it took to get it to that point. Most of the big gold mines in operation today are largely an operation of turning oil into gold. Many of the past ones took that, plus bullets and bayonets to get it done. Point being, that little gold sovereign in your hand is getting tougher and tougher to replicate at todays prices. Higher oil prices are good news for PM's and don't let anyone tell you otherwise.

  10. I bailed out of my SLV Jan 30 calls today. I see silver going sideways through the holidays and options will simply lose time-value. Still have some April 35 and Jan 2012 35 calls in play.

  11. @RoCoach. Dittos, almost exactly. Just checked the Globex -- Bid=$29.18, Ask=$29.32. It's dead, Jim.

    BoS's are done for the week if not the year. Strap on the seatbelts Jan 3.

  12. Once in a while, I like to buy a bit of physical silver, which I did today. On the ingots is stamped "valcambi suisse". I have never seen that stamp before today, and wonder why the physical I just purchased came all the way from Switzerland. Previously, any ingot I purchased was marked BNS (Bank of Nova Scotia) or Engelhard. Is the local stuff now so hard to buy that whatever I can get has to come from overseas? Just wondering.

  13. @ Marcus - Where did you buy from? Just curious.

  14. Hey Marcus,

    I think they are the mint for the Bank of Nova Scotia. BNS doesn't mint the bars themselves, they get another company like Valcambi Suisse to do it for them.

  15. This guy is the best.
    He cuts through the crap and doesn't get distracted by the chatter. All anyone needs to do is read Franklin and Turd every day and trade accordingly. All the other stuff about JPM, the Chinese, etc. is just noise.

  16. Amazing to me it's the 22nd and COMEX still has a million ounces of silver to deliver. Oh, they'll make it and not default this month, but it's obviously a stretch and a half to do it.

    Anyone waiting for a large correction in the phony paper market price is probably whistling Dixie.

  17. Price has been too quiet and steady for several days. Like we're in the eye of the hurricane.

  18. thecoloresky, purchased at BNS head office, downtown Toronto.

  19. Stewart Thomsom posts regularly @ Bob Moriarty's He's a trader and gold bull and has a pretty good track record though sometimes it's hard to decipher his rapid fire style. In his latest he dangles a vision of sugar plums for gold holders over the holiday season.

    "... The central banks have no interest in buying gold cheaply or selling it “high”. During gold revaluation (now) they want to pay higher and higher prices for gold, to ease their ability to pay their creditors in paper money. What if the monthly chart RSI on gold went overbought for the next five years on Gold, like it did the Dow? What if you sold all your gold now and the central banks revalued it to $2000 over the Christmas holidays? Would that be a party? Maybe you better put that overbought RSI chart back in the cracker jack box that it fell out of and enjoy your Golden Christmas, which is being brought to you by Central Bank Gold Liquidity Flows!