Ahead of an Interesting Weekend

Well, don't you wonder what the world will look like come Monday? So many unpredictable events are coming that it makes the job of being Turd significantly more challenging. However, The Turd is up to the task and willing, once again, to attempt to predict the unpredictable.

First up, the short term. As postulated late yesterday, the metals rallied overnight and are rapidly approaching the points from which their enemies will be able to proclaim any future decline as evidence of a head-and-shoulders top. This H&S top notion is almost as silly as the "gold in a bubble" nonsense but they're going to spout it anyway and CNBS will lap it up like hungry kittens. As The Turd's old man used to say: "Do you know what motel spelled backward is? Let om". In this case, that logic applies. Let the buffoons spout all the bubble and top nonsense that they want. It doesn't matter. The metals are still going significantly higher before year end and none of the top-calling douchebags will be held accountable for being wrong anyway.

For today, I predicted yesterday that gold could see 1790-1800 and that silver could see 41.80-42.20. Upon further review, I'd like to refine those numbers just a bit. Now, we may have already seen the highs and they are both close enough to those targets that they may not trade much higher. Gold touched 1798 and silver tapped 41.34. I don't think silver will trade much higher than 41.50 today but it could still reach up to the goals stated yesterday. Gold, on the other hand, still could see some upside. IF it can trade through 1800, it has a decent chance of making it all the way to 1820 or so. If it does, I will be looking to lighten some Oct calls before the weekend.

paper_8-26amgoldh.jpgpaper_8-26amsilvh.jpg

That said, the long term picture for both metals remains quite positive, regardless of the nonsense you hear on financial TV. Both of the charts below are very instructive and I plan on updating them frequently in the coming days and weeks as I believe they represent the true picture of what to expect for future price movements. Note that silver is in a very nice up channel. This is much appreciated as it is something that takes much of the complication out of trading. Gold, on the other hand, has a chart formation that you rarely ever see. Let's call it a "reverse pennant" and it is indicative of an uptrend that has an increasing level of volatility. IF this trend continues, we can use this chart to make a lot of fiat as the swings up and down are only going to get wider.

paper_8-26amgold8.jpgpaper_8-26amsilv8.jpg

I'd like to close today with a couple of housekeeping items.

1) Civility. Please remember that we are trying to build a place here that is unlike other internet sites. We treat others the way we want to be treated. This leads me to...

2) The goal of this site is to help and educate as many as possible through our collective experience and wisdom. The site is used by people ranging in age from 13-93. If you would be uncomfortable using certain language, innuendo and images around you daughter or your grandmother, then don't bring it here. Use discretion.

3) Try to take it easy on poor, old Blythe. During work hours, she may be a heartless shrew who takes pleasure in the blatant manipulation of the metals. In her personal life, her bio paints a portrait of someone different. I guess my point is: It's beneath us to deride her with nasty slang on her personal sites. Let others do that if they feel they must. We here should be more concerned with surviving the disaster that is most assuredly coming.

4) I do, from time to time, delete things. This is not censorship. Censorship is an impairment of your right to free speech in the public arena. This is not a public arena. This is my website. I own it. I decide what gets viewed and what stays posted. That said, I've only deleted a handful of things in the first 60 days and most of it was copyrighted material that could not be allowed to stay.

Finally, be very careful as we head into the weekend. The current pattern in gold is frighteningly similar to the pattern of silver back in late April. The Sunday Night Massacre followed the first margin hike and occurred during a thinly-traded Globex session the preceded a London holiday. Gold has now seen two margin hikes and this Sunday's Globex session also precedes a London holiday. Throw in the fact that many market participants will be MIA Sunday evening due to what looks to be an ongoing hurricane and you get an almost ideal setup for the criminal C/C/C to unleash Sunday Night Massacre II. Not sayin...just sayin.

Have a great day. I'll try to update after the close.  TF

413 Comments

speconomist's picture

Volatility, volatility, volatility

Volatility, volatility, volatility, is someone looking at the charts today?

In my opinion we will get margin hikes officially announced today or early next week, take a look at the chart of Silver in May, after the low of $33, the price went furiously up, and 5 days after that was smashed down to a new low around$32.50.

I'm not saying it's going to happen exactly like that, just suggesting a pattern where a combination of takedowns and margin hikes we have recently observed and the likelihood that it may happen again.

Also, the Bernank mentioned that he is going to try to restore price stability, obviously that won't be his first goal during the upcoming week, when the SP500 will crash to new lows.

And as always thanks a lot for your update Turd!

Golden Turtle's picture

Yo

2nd.

Old Major's picture

Thanks TF!

Thanks TF!

Tesla's picture

Morning Turd!

ScottJ's picture

WorldWide Gold Markets

Just a reminder we are in a world market now, with gold being the asset of choice for many others in this world.  Any dip that may happen in "US Price of gold" will be seen as a buying opportunity to our European gold vigilantes who are dealing with the Euro Crisis (and all other countries who are trying to flee the dollar).  This is why I believe no dip will be long in these times until gold goes much higher and to the point where the world can "stop and take a breath." The stopping point will be a psychological thing rather than a fundamental reaction if I had to guess.

Imagine what Greeks thought yesterday when they had an opportunity to buy the dip (in euro gold) because of the raid for comex expirations day.  Their country is getting pillaged and the safe-haven asset dropped because of the ponzi scheme going on at the Comex. All of the sudden this small little exchange is becoming center stage in pricing one of the hottest and most important financial assets worldwide.  When the comex/lbma bust, mania will ensue.

--

Example from earlier:

Euro Spot Price: 1237.59

USD Spot Price: 1787.36

EUR:USD ~ 1.442

1237.59 (Euro Gold Price) x 1.442 (Eur/Usd)=~ 1784.60(USD Gold Price) 

Gold/Euro * Euro/USD = Gold/USD

(error due to me not capturing Eur/Usd at the same time, but you get the picture).

With all that said, always be aware that we are playing in a rigged market.  And they have tremendous power to affect the short term, but not the long term.

Maryann's picture

Respect

Turd, I can't express enough my gratitude and respect for your integrity, maturity, wisdom, and graciousness.  Like I tell my kiddo, God will bless and reward you for doing good, even if at times others don't get it!

Hope you and your family have a wonderful weekend.

Chris P. Bacon's picture

Thanks Turd

Your enumerated points should be taken to heart by all.

NW VIEW's picture

HEADING FOR NO. 1

Thanks Mr. T.F. for a great post.  Items No. 1-4 will bring this metals site to the masses and become No. 1. 

unky's picture

buying opportunity on monday

So we will have a buying opportunity on monday, for both, gold and silver?

We love you Blythe

timpa's picture

curious

Give me a little insight here please. When all fiat goes to zero just what will the mode of exchange ultimately be and will gold and silver maintain the value they have climbed to. I know this may sound like an absurd question, but I'm curious as to other opinions of the future...yours too Turd. I never had any plan to exchange my PM's for fiat, so just where will we be, what will this all lead us to?

unky's picture

gold and silver in smaller units

easy breezy. i thought about it today in the subway because the commercials of gold i see in the newspaper everyday.

1 gram of gold is at 40€ now. so we will trade in milligrams of gold which is 4 cent. this seems like an acceptable small unit for transactions ;- )

margaritatime's picture

uh...

I wouldn't be so sure of a major buying opportunity on Monday. I would BFTD. What Scott said above, I agree. Those expecting a early week fire sale may be disappointed I think. I don't see gold following the May silver route, the fundos are entirely different, as are the players. 

beinki's picture

I've often wondered where the C/C/C/ meets.

¤'s picture

Sept. will be ugly until the 21st?

Next FOMC is Sept. 20 and 21   and they are a  Tuesday and a Weds.

That was the one thing that stuck out to me that's a bit out of the ordinary. And it falls on a Weds. right in the middle of the trading week. Plus they announced a extra day which is out of the ordinary. That's the big take away from this for me.

If we all thought the speculation was rampant this month for this Jackson Hole build up/drama wait until next month. I have a feeling between now and then something big in the marketplace and economy or elsewhere will make something necessary from the Fed. and Sept. 21 will be a memorable market day.

@Tesla.... the illuminati comment....I agree with the analogy.

There is something wrong about that trio being together even if it is considered normal for them to do so, but is it necessary? All of these central banks coordinating together is a global structure that is  strangling the planets growth and stability imo.

With those big 3 getting together, you would think something would have been announced regarding not just the U.S., but the European situation also.  We'll have to see what is leaked out over the weekend or wait to see what they actually do in deeds and not words, or lack of them.

It seems almost impossible to me that  complete inaction is the only thing that came out of this highly anticipated event. 

They literally did nothing according to the speech itself but we'll see what happens going forward starting with Mondays open. Too many significant issues are happening that are urgent, so the possibility they came to no "head nod" agreements on those other issues seems remote.

The market and the PM's are all over the place. This sets everything up nicely for them in Sept. as I believe this will be one of the most volatile Septs. ever.

They are meeting for an extra day for a reason and the fact that Bernanke actually said why ( "fuller discussion of tools") was a obvious telegraphed nod to anyone who wondered why they are meeting a extra day.

He didn't have to give a reason why, but he did.   Why? H'mm....

bikerspade's picture

Gaddafi

I think there's a good possibility that Gaddafi might be captured/killed this weekend, especially if he's surrounded inside an apartment building in Tripoli. It could be the catalyst that smashes the metals on Sunday evening.

http://www.zerohedge.com/news/game-over-gadaffi

Iowegian's picture

When the Turd Speaks!

PM's listen.

Notice how the prices are moving to his targets faster than projected?  Me thinks Turd has more clout than he realizes.

CreditCrumbs's picture

QE no QE, does not matter

For PM investors, don't get distracted with no QE announcement. The long term picture is unchanged. Why?

1. The fact is that rates are being pegged to 0% until at least 2013 already ensures that PMs are more attractive than USD. Paul Kasriel says the pegging is a reckless decision, because 2 years is a long time, so what if lending recovers before 2013? The fed has committed to 0% so high inflation will ensue and the fed is guaranteed to be unable to stop it. Combine it with McLeod's prediction, hm... something that acts as a QE but not called QE may be pursued. 

2. If the stock market tanks, then truly there is no credit expansion because government borrowing crowds out private savings available to the economy. So far I have been amazed that the stock market is only down 10-15%. So that is inconsistent with no credit expansion. Somewhere somehow credit is expanding. But it may be too soon to tell. We will see whether there will be stock crash or not. 

3. The fact that Sep meeting is extended for 2 days, I am guessing that Bernokio has seen that inflation expectation starts to be come un-anchored with QEs. So he has to find another way to ease without people seeing it as QE3. That's why the Sep meeting is 2 days rather than 1 day. If it were going to be QE3, the mechanism is already known. Why does it need an extra full day of meeting? So I believe Bernokio is trying to ease but without being seen as easing. 

 
CreditCrumbs's picture

My Take on Bernanke's Speech

  • He says that commodity price increases is temporary. This means that the current correction in commodities are not deep enough yet for him to start more QEs.  
  • He hopes that education standard increases and reaches broader population base, and health care to be more affordable. This is a veiled threat to congress to act.  
  • He says that international economic competitiveness has improved, and trade deficit has declined. That he is proud of that means that one of his objectives QE1 and QE2 was for USD debasement. He is patting himself on the back for a job "well done".  
  • He expects inflation rate to go below 2% in the next few quarters. That is another signal that he wants price weakness first before resuming QEs.  
  • He expands Sep 20 meeting to 2 days to discuss more accommodative monetary policies. Taken together with the points above, he hopes commodity prices and inflation rate to decline sufficiently for him to justify doing more QEs by September. He is eager to pull the trigger but not until at least September.  
  • He wants fiscal policy to reward work and saving. That means he wants austerity for the people in the short term to reduce welfare handouts.  
  • He blames congress for dragging their feet for the debt ceiling deal. In effect, he says that if you see the economy faltering, blame them, not him. He is doing his best to help economic growth. He even claims that unlike Feds in the past, he alone has the ability to boost long term economic growth. His main policy? Long term USD devaluation/debasement.
  • Read the speech for yourself to see how arrogant Bernokio really is. "I know it all" and "I alone can do what past Feds could not do" attitude abound. 
The Death Ceiling's picture

Language

Thank you Turd once again for all your efforts and insights. 13-93? That's very illuminating.

I agree, it is not necessary to use language that may offend others to make a point. 

argent rampant's picture

Nicely said, Turd.

We appreciate your leadership.

I am staying flat over this weekend. Looking forward to establishing new positions (SLV OCT/NOV calls) next week! Might start buying some GLD calls as well...   maybe.

olderman's picture

Words from Santa

"For heaven’s sake stop barfing into weakness. Stop selling weakness and buying strength. That is a kindergarten type error."

One of these days, and soon, TFmetalsreport will go from 15000+ hits per day to 50000+ hits per day. Many, many thanks TF for all you do to educate this community.

olderman

terri5125's picture

to buy (physical) or not to buy

that is the question...

Hoping to learn's picture

New Fiat

I believe history shows that a new fiat eventually rises that is tied to a more consistent value recognized by the masses.  Current value of gold at the time will work quite well for those who are stacking.

Hang10-Hawaii's picture

So just how is Bernank-houdini going to do it?

Been giving this a bunch of thought over the past few weeks, and it's still not clear to me how Bernanke is going to keep the US Treasury's coffers filled with Benny-bucks.  Today's speech didn't offer anything compelling beyond ZIRP for the next two years.

Here are the rough facts about Federal spending and revenues:

* Spending ~ $3.8T

* Revenue ~$2.3T

* Deficit ~ $1.5T

* Outstanding Fed debt ~ $14T

As we know from the recent debt ceiling soap opera, there is no relief on the spending line.  The revenue line will remain unchanged absent some dramatic economic growth and/or draconian tax increases (not gonna happen),  - so no relief there.  That leaves the deficit at something north of $1.5T each year for the forseable future. 

My question is: "where is that money going to come from?"

Our foreign creditors are about done lending to us.  The public is too broke to lend to the government.  That leaves the Fed as the only option to print money to put into the Treasury.  There are basically two ways that can be done: 1) out in the open a-la QE2, or 2) off the radar, but how???

I'm leaning towards the second option.  I'm trying to figure out how to trade this fact.  Clearly over the long term the money will end up flowing through the Treasury into the market and driving inflation and PM's higher, so buy & hold remains unchanged.

What I can't figure out is if there will be ebbs and flows that we can use to trade.

Any thoughts?  

surfeitndearth's picture

Thanks Turd

I nominate you for the Good Housekeeping Seal of Approval! 

joe rocker's picture

curious Submitted by timpa on

curious

Give me a little insight here please. When all fiat goes to zero just what will the mode of exchange ultimately be and will gold and silver maintain the value they have climbed to. I know this may sound like an absurd question, but I'm curious as to other opinions of the future...yours too Turd. I never had any plan to exchange my PM's for fiat, so just where will we be, what will this all lead us to?

The thing is...the paper money value goes to zero and people will USUALLY (always have in the past) accept silver and gold as payment.

Ranch's picture

What to expect now???

Margin Hike still a concern?
No QE3 till September...concern?

Are we still looking for another dip later today and early next week?

Just curious what everyone thinks givens this mornings news and activity?

bensgone's picture

MASSIVE GLOBAL FIAT-GOLD WAR LOOMING

Clearly we are witnessing the unfolding of a gigantic world war between the PM's and the global fiat monetary system.  You must think on those terms to understand the magnitude of the power of the EE to suppress the PM price for god knows how many years.  Scottj presented evidence that this war goes way back when the U.S removed silver as part of the bi-metallic standard causing a depression, because then EE held most of the gold and did not want monetary power in the hands of the people.  This was done at the behest of the Rothschild proxies here in the U.S.

Right now we are seeing this battle take on monumental significance and proportions as more and more people wake up to the massive global fraud of fiat.  This is why the stakes are so high and becoming more and more intense each day as the forces of fiat darkness take on the multitudes of the earth's inhabitants who now attempt to protect themselves from the inevitable collapse of all fiat worldwide.  Even central banks in countries large and small  see the writing on the wall and are buying up both gold and silver to bolster their reserves in preparation for the coming storm.

There is an old saying which states, "Never bet against the FED".  I say you better bet against the FED with gold and silver, or you are dead!  These gigantic forces are tugging against each other causing increasing volatility and gyrations of the prices and volumes unlike anything I have seen before.  It's not just JP Morgan who is the  the prime enemy of the PM's, but every central bank in the world, every fiat currency, and every elite who benefits from this corrupt evil financial and monetary system.  So, when you buy physical PM's to protect your wealth, you are in effect betting against the entire global financial system and every aspect of the hierarchy that keeps this rotten system from imploding.

pbreed's picture

Our Pal Warren

question's picture

Turd; Class Act Sir!

Kudos for raising it up a notch. Honored to be here.

May all find shelter from the storm here (metaphorical and physical).

Peace

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