Wednesday, January 5, 2011

No Morning Beatdown

But who needs one after yesterday? Ain't it great? Blythe gave us a break this morning! Well, sort of, as gold has continued to sell off once the Comex opened. I have a last of $1366 and 28.70. Given the continued downside pressure, I thought it best to repost these charts from yesterday as we will all be looking for support levels to hold today. First, gold:
Next, silver. With the continued beatdown this morning, we blew through 29. This chart makes it look like 28.20-28.50 should contain things....hopefully.
The dollar rally isn't helping matters this morning. This new year is beginning to smell like early 2010 when the dollar rallied on the back of all the "green shoots". Our spectacular U.S. economy means that all is well, happy days are here again and QE is no longer necessary, so sell your gold! Rrriiight...
Anyway, here's an updated $ chart. Obviously we did not get the breakdown I had been hoping for. It looks like we will continue to be rangebound between 79-81.

Lastly, I feel badly that I got all charged up by the weekly charts and felt so confident that the next leg higher was upon us. It sure f-ing looked like it but ole Blythe has a way of making you look like a jackass sometimes.
Keep the faith. NONE of the fundos have changed. The economy is lousy. The banks are insolvent. The federal government is technically bankrupt. Cities and states are seeing their financial positions worsen by the day. Let the hedgies and the algos trade away their gold. We'll buy it from them and take delivery.

More later. Turd out.


  1. Near the end of WWII, the Japanese, knew they were defeated after a failed Pacific Fleet sinking. So they went Kamikaze. Blyth, after a drunk partying weekend, smelling defeat, is going kamikaze. Expect this to last for 2 weeks as the govt posts even more bogus jobs data.

  2. Unfortunately either Blythe did indeed hit again or selloff by weak investors who need to understand why they are getting in this market in the first place.
    You spoke to soon!

    This is foolish to watch the USDx spike up. Who are these people and why do we call them financial experts (after all I am sure a lot of sheeple go to these morons and ask for advice).
    I am not trying to be mean, but this is so upsetting that people can be so gullible that anyone who trades USDx futures is fair game to getting burned bad.

    To all those with puts on Silver/Gold and Calls on USDx (I don't imagine anyone who reads this blog), I eagerly await the day when you are crying because of the sheer stupidity.
    Realistically, it is being propped up by the governments some how...
    Can't wait to complete the mega FUBM...
    Well said in the last paragraph.
    Scott J

  3. This is a storm in a teacup. Non farm up, a failed bond auction from Portugal, and other non events has the dollar rising from the ashes and the EE going for the drop. We caught a nice bounce at $1362, but I still feel like I stepped off of a roller coaster. Any who, for anyone that was not able to make it to the coin shop yesterday, here's to second chances!


  4. I sold in anticipation of a morning beatdown which seems a good thing by now.
    And the low prices are a problem of Blythe anyway, I don't know whether she already found out that lower prices increase demand and suppress supply.
    Well, she'll find it out

  5. Right there with ya Turd. All you reiterated is correct. This is simply an offensive during their fighting retreat.

    While these can be wickedly effective in the short term, they cannot be sustained, and they make things worse for the Shorts in the long run. I hope they enjoy their success while it lasts. But like millions of PM and miner equity buyers around the globe, I'm just waiting for this foray to bottom in order to add to my positions.

    Realize that many very attractive junior, near-mid and mid size producers, and several explorers are becoming excellent buys as the raid continues. It is a gift opportunity to add shares at a discount. Now I just gotta find more dough.

    So don't despair friends: BM and JP Mordor had to come out of the 2011 gate swinging in order to blunt the near mania at year's end. Get the uppity natives settled back down and discouraged once again. But price action like we've seen this week can be highly illusory.

    Absolutely nothing important has changed the past 2 days EXCEPT the prices you get to pay to buy more of what we want and know will win in the long run.

    The rest? It's Sound and Fury Signifying Nuttin'

  6. On Bullionvault, the bid for silver (physical, in the vault) is $29.95. Futures price is $28.96. Hmm...

  7. "A Muted Reaction Among Markets to ADP Report"

    China will prop up Spain:

    US won't be getting any of that panda love. Munis, you're toast.

  8. The last time this happened, silver bounced off $28.00 to the penny. We've been here before.

  9. There is more to this than Blythe. Look at gold's yearly chart, in particular take note of the last big sell-off starting 7/1/10. Then check out FOFOA's latest.

  10. "The banks are insolvent. The federal government is technically bankrupt."

    Turd is right about that, but what we need to realize is that the banks and the federal government are one and the same.


  11. is it a beatdown or isn't it?

    you claim No Morning Beatdown with the title, but second paragraph says there's a continued beatdown.

  12. Turd and all...(LoL)
    Here is an excellent article (not long winded) on why not to worry about the beat down and why its in you and your family's best interest to keep on gobbling up the gold and silver

  13. Are we sure that a default ( march delivery )
    in silver will drive up physical and paper silver
    prices or should we be out of all paper before
    then ? I still own PHSP - etf securities uk
    claimed physically backed. thanks

  14. Ok so EE's game plan is sorta clear now: They knew the job # in advance so they unleashed some shorts in advance and then attack on the Johny-come-late weak hands when the job # is released. Notice that China BOS has not responded. Maybe it has sth to do with their chairman scheduled visit to US, a truce for diplomatic purpose maybe? HOHO. I don't know.

  15. Market appears to be sobering up a bit.

  16. Harvey's take on the raid was great... slow unwinding of the short positions makes a lot of sense. Ironic if true, as it would make Blythe (of all people) the sigificant short seller leading the bounce back after each raid!

    Kiss & make up time Turd?


  17. Buddy: sorry for the confusion...not enough coffee.
    What I meant was "no 8:25 am beatdown" like we've had for 8 of the previous 10 days.

  18. UK: maybe March, maybe not. But when if finally happens, the price of actual physical silver will skyrocket.
    Less supply + Increased demand = higher price

  19. Looking like another FUBM formation in the making.


  20. The Godfather of gold Jim Sinclair( or Santa if you prefer ) is the Chairman of Tanzanian Royalty Exploration. I consider this stock the best possible way to get extraordinary leverage out of gold ( and nickel; diamonds; and other base metals ) Do you own DD, but do it quick. I think this rocket is ready to fire. If you visit his website, which is quoted by Turd, everyone really very often, scroll down until you see a penguin with gold cymbals ( symbols???) standing over a sleeping giant, a polar bear. The caption is a very non-subtle hint that things are poised and imminent, from the Man himself.
    Hmmm- junior miners that are producing, or are just about to be producing-what could that be referring to??? Hmmm

  21. Turd, like Michael, I've wondered whether Blythe is actually unwinding JPM's short position.

    Is there a good way to test that theory? I keep an eye on Harvey's daily report on Silver COMEX OI (which has dropped from 160K+ in November to 136K), but I know that's only one small piece of the puzzle and hardly a tell-all indicator.

  22. If I am a buyer of physical, which I am, I would wait until the knife hit the floor before I get back in. Why guess the bottom. If we swing low, get back in, if not, there are two price points below that make more sense.

  23. Picked up some more 1 oz Ag rounds for under $30 (includes shipping & insurance) on today's dip. Bought more First Majestic (AG) and SLW too. Take advantage of these JPM-engineered beat downs.

  24. No, unwinding the short position would be explosive to the price. The large commercials are trapped....there's a metal shortage and the demand is increasing. Just watch the Commitment of Traders report every week for the totals (assuming it's accurate..if anything they under-report the actual position).

  25. Hi there all,
    First of all a big thank you for all of your posts Turd. You've got our support (NW Europe) as well). I have been following your blog for quite some time now and I would like to ask the following question:
    Just today I was analysing the future volume on silver that got me thinking. My calculation based upon today's volume got me to think that all the shorts combined would generate 400 Mio loss (on a daily basis) given a rise in Silver prices of 1 USD. JPM;s annual profit in 2009 was 11.7 Billion. Does anybody of you have any idea at which silver price JPM would begin to generate an actual annual loss? I know that JPM is not generating all the shorts itself, but is probably (most certainly) the major player when it comes to short positions, but we we're wondering if anybody had any idea about that.
    Thanks an keep up the great work...
    A silver bull

  26. SLW ANV PSLV HL today at discount prices......thankyou ponzi masters......I say don't stop now....shake a few more weak hands

  27. Koen-

    Not to step on other commentary (which I would like to see- I have wondered about the 'loss potential' of these massive shorts myself) but I think there is a portion of the equation you are missing. WHY does JPM have an interest in suppressing the price of silver or gold? What do they gain and is it commensurate with the potential losses they incur during a secular bull market like we have had?

    I think the answer is that JPM has little reason to suppress PM's, just for JPM's sake. Why would they care? Why would they throw away billions just to keep the price of shiny metals down? However, The US Treasury and Fed, however, have EVERY reason to hold down the primary alternative to Fiat currency. So I have always assumed that a "dark line" of Fed credit of some form or another is promised to the huge banks like JPM (possibly as a payment for the too big to fail bailouts, etc) to pay for any losses they incure in doing the Fed and Tresaury's bidding. In other words, they are just the conduit, but the motive for these actions rests with those who wish to print unlimited amounts of money.

    The venality of US taxpayer funded institutions spending US taxpayer dollars (or the implicit promise of same) to artificially supress an asset widely held by those same taxpayers, is extraordinary. We live in interesting times.

  28. Go out and BTFD - check
    FUBM chart pattern formed - check
    Feed the TURD! - check!

    Thanks Turd from the North woods of Maine!!! You have at least two fans in our forest!

  29. VGZ bitches. It's been a dog for a long time.
    Dog no longer.

  30. Koen: First of all, thanks for being part of the blog.
    Be sure to read what "pining" wrote above as he is correct in his view.
    JPM is simply doing the bidding of their FED master. How much $ they lose has been irrelevant since borrowing at the discount window and using the $ to buy trsys makes them so much money. If silver goes to $100, it gets slightly more relevant:)

  31. Hi There Pining & Turd,
    First of all thank you very much for your replies. I tend to agree with you guys for the Fed & Treasury to be the only real parties with an intention to keep PM's down. I get the fact that they let the JPM's, CFSFB's, HSBC's and GS's of this world to do the dirty work and that they only have to fund these parties with QE1, QE2 (& QE#?) money. What I don't get it in that case they can get the PM prices at levels where they want them to be. They could have kept SLV prices at 20, 14 or 8 if that's what they wanted. Money is free, so why allowing PM's to rise? In this view I can imagine the USDX and PM's to lower simultaniously in stead of inverse on one another. Only real question is what the new monetairy system is going to look like and whether it is somehow related to a PM (presumably gold). It amases me that people (on this blog as well) are still in ETF's, since I think that ECB, Fed/Treasury and China are all accumulating physical PM's to back the system we're about to see in the near future. When (and if) the current fiat system collaps the people owning the PM's will be the ones with the power. The wisdom, "if you can't touch it, you don't owe it" will become the tragic realism of the new area. As you said Pining; these are interesting times ;-)
    Let's see what Blythe has in store for us today!
    Thanks again for all your efforts Turd!


    Roger Wiegan on the Korelin Economics Report. His overall view for 2011:

    First 6 months of 2011: stock markets will rise, with corrections within normal trading range. The usual cheerleaders will sing "happy days are here again", because investment banks have IPOs to pump and dump.

    Gold and silver will do well. Fundamentals for silver are strong, expects $50 or more this year.

    Stock market correction expected at end of January. Expects oil up during January, inflation will push costs.

    Mild correction at Q1 end. Stronger correction at Q2 end. Nasty smash possible in Sept/Oct.