The Turd is very happy to see a rebounding PM price this morning. As I retired last evening, silver was once again breaking $40 and I feared that the Great Carry Panic II was on. So far, so good. Instead, sanity has returned. The dollar is down. Gold is back above 1465. Silver is pushing 41. Crude made it all the way to 107.87 before reversing. Let's see if this can be a Happy Tuesday. All I know is that I'm going to be a little cautious when we approach $42 again. The sharp reversal of yesterday will give Ruprecht plenty of incentive to try his dirty tricks at that level next time.
Here's the best looking chart of the bunch, gold. I had given you 1465 as a clear level to watch yesterday. That number has now acted as both support and resistance so it is obviously has significance. Happily, we are back above it as I type. Now we need to kick away like Secretariat and move toward 1472 and, from there, the old highs of 1478.
OK, here's a real chart, though it looks about the same:
1) Another global financial collapse?
2) SPIN of a recovering US economy?
3) Breakup of the Euro?
4) Catastrophic MENA war?
5) U.S. budget/deficit reduction?
Hmmmm...Well....I suppose we can rule out #5. They tried #2 last time. Didn't work then. Won't work now. #1 would only make matters worse for the TBTF so I doubt they try that one. #3 is kind of an old reliable. They could run out another PIIG and see if the euro rolls over. Maybe. But if the euro were to dissolve, the new Deutsche Mark would only challenge the dollar further so that's no good. No...gotta go with #4. Of all the options, #4 provides the quickest and safest answer for the Fed/TBTF/Govt complex.
OK, its 9:20 EDT. The metals are hanging in there, but just barely. The dollar is getting smoked but the long bond is up. Go figure. The euro is almost to 1.45.
Its going to be a very,very interesting day. Keep your brain turned on. TF