What Do You Make Of This?

As you know, pattern recognition is one of the main practices that we preach here. It's one of the primary reasons I've had some success with my technical analysis over the years. Well, do I ever have a doozy for you this time.

My buddy, Trader Dan, (http://traderdannorcini.blogspot.com/) has some fancy-schmancy TA tools. He uses those applications to draw some of the coolest charts you'll ever see. Every once in a while, he'll post one that I'll save for posterity, with the idea that it may be a useful tool to refer back to in the future. One such chart was a daily chart of the Continuous Commodity Index (CCI) that he posted on September 6. The chart had the appearance of something that could go up OR down and so I saved it to my hard drive. Here it is:

large_cci_index_as_of_9-6-2011-1_1.jpg

Note that, after a steep selloff, the CCI had been essentially range-bound for a while. Sure, it looked like there was resistance around 663 but it didn't necessarily look like the bottom was about to drop out, either.

With this buried in the deep recesses of my turd-like brain, I stumbled upon this daily chart of the ES ( the mini S&P futures contract) earlier today. Take a good, long look:

paper_10-12pmes.jpg

Note here that, with the addition of trendlines similar to the lines Dan added to his CCI chart, we get an S&P chart that looks startlingly familiar.

"Well, that's interesting", you say. "So what"? I'll tell you what...Trader Dan posted yesterday an updated CCI chart that shows the action since 9/6. Take a deep breath and look below:

large_snapshot-941.png

YIKES! Let's just say that you've been officially warned.

Now, does past performance ever equal future results? Of course not. However, if a lack of current QE and a global economic slowdown can be blamed for the current plunge in the CCI, why wouldn't those same fundamentals eventually have an identical effect on the equity market?

This is definitely something to watch as we move through this month.  TF

228 Comments

LongGoldLongSilver's picture

Check Out These Charts Instead

=)

LongGoldLongSilver's picture

A Lot of Silver Charts

The short covering has continued and you really have to wonder just how much can be sold by the speculators. They are holding close to unprecedented small net long positions and the overall picture has a bullish shine to it, not seen since 2003. And as far as I'm concerned you have trillions of more reasons to own silver today than eight years ago.

I'm not gonna be annoying and post the other five charts here, but similar COT levels have always spotted the bottoms the past 10 years. Check them out: http://bit.ly/oriInP

Silver really is awesome! I'm even drinking it when sick. It works!

Odin's picture

Crash

Could be next week, could be next month, regardless my shorts are set and ready for lift off...

ivars's picture

Patterns rulez- another short term prediction true-EUR jumps

Interestingly, in this recent USD per EUR post and very  long term graph (2012-2017) :

http://saposjoint.net/Forum/viewtopic.php?f=14&t=2626&st=0&sk=t&sd=a&start=600#p34394

I have made also a correct short term ( 1 week) prediction about sharp increase in USD per EUR after October 5th, whose consequences I would like to expand upon. The area of correct short term ( 2 weeks ) prediction is encircled to make it visible in the long term graph.

So what I have predicted on October 5th is , that USD per EUR will go up from 1,325 to 1,40-1,425-1,45 till the end of the year 2011. We see the first week of this movement already (of course, it will not move up in straight line, with hiccups, the line is to thick, but the general trend is clear):

Now, where is the logic? Eurozone debt crisis comes to its conclusion, Greece will default in November, that has negative impact on banks which has negative impact on stocks worldwide which has negative impact on business confidence and growth , leading to inflationary recession in Eurozone in q1 2012, and deflationary in the USA in q1 2012.

Why would anyone now buy EURos or Stocks?

I think here we have clear case of psychological denial of what pain is coming so soon, and irrational exuberance of short lived and temporary type impacting the  investor behavior. If nothing can be done why not have some fun ( with irrational expectation that somehow things will turn out well).

I think one name for such behavior is (coming from Russian): "Feast in Time of Plague". There must be English saying with similar message.

Looking in the charts, what will happen next:

Greece will default, and from January 2012 there are less and less USD per EUR. As USDx grows, and so does quite a few PM/commodity vs USD, EURozone after dismissing Greece and who else will get inflationary, and in recession. Stocks (DJIA) will fall sharply after this last hiccup, and USA will enter recession in q1 2012, deflationary, with increasing dollar index.

1) For those with EUR, this period Oct-Dec 2011 may be the last one at least for 4-5 years either to buy USD or invest directly into PM, other commodities at good price levels given high USD per EUR ratio ( 1,38-1,45 is as high as it will go).
2) For people with investment in stock indexes, especially in USD, this is the last time to get out into cash at decent levels ( DJIA 11600 is not as good as 12800 but its only 10% below post Lehman USA stock market peak);
3) Once in USD cash, there is still time to buy Silver around 33 till April 2012;
4) For gold , there will be another opportunity window in late January 2012 for about a month to buy it at 1580-1620 USD again.That corresponds with the next dip in USD per EUR in early 2012 to 1,325.

 

Shill's picture

As long as TPTB keep moving

As long as TPTB keep moving the goalposts, nobody will notice we've run out of field.

cpnscarlet's picture

Celente on KWN ... Again (Repost)

For the second time in as many weeks, Celente is on KWN. Don't bother - same old poop from him. Not that he's wrong, but his blabber is completely void of anything in terms of hard data to act on. If he does this to entice me to subscribe to his newsletter, it ain't working. Nice Bear Ear-Candy, but it's all said here with more flair and some interesting analysis to boot. Feed The Turd.

Pining 4 the Fjords's picture

Gold and Oil, Oil and Gold

It has been observed many times that gold and oil often tend to trade together- favorable conditions for a rise in one tend to spur a rise in the other, and vice-versa.

So here is something I have been pondering the last few days...  what are we to make of the fact that WTI crude is up 14% over the last week, while gold is up just 3%?  I get that Iran may or may not have secretely tried to assassinate the Saudi ambassador to the US in order to stir up an international incident:

http://www.washingtonpost.com/world/national-security/alleged-plot-is-uncharacteristically-bold/2011/10/11/gIQA7vzpdL_story.html

And that reasonable people may see this action (or this false flag, take your pick) and its potential consequences and may think oil was a bargain at 75-77$ a barrel.  Fine.   But an 11% price disconnect between gold and oil in one weeks trading?    Very, very strange. 

Something is afoot, here...

tyberious's picture

DOW, S&P?

Odin,

Are you shorting equities, indexes, miners? Tell me whatca got! I looking at SDS calls or UPRO or SSO puts!

redwood's picture

Ivars

Would you include mining stocks when you last time to get out into cash?

cpnscarlet's picture

Co-inky-dink?

Again seeking to get a cash position before the weekend, I sold most of my MOO which was the least red of my current holdings. This was just a few hours ago before Turd posted the above charts. Omen? Confirmation? Dumb Luck?

redwood's picture

"when you say last time"

"when you say last time"

ivars's picture

Day 16th fo short term prediction- still doing fine

It was posted in this site as well, i day before I reposted it in Sapo's joint ( below):

http://saposjoint.net/Forum/viewtopic.php?f=14&t=2626&st=0&sk=t&sd=a&sta...

1) Silver may fluctuate around 30 USD (+- 3?) for 1 month or so (except very short sharp peaks, perhaps) , then move up sharply about 5 USD to 35-40 and drop again, now to little higher level of 33-35 +-5, and not change much anymore this year. So the bottom will be kind of close from time to time during October.

2) Gold, on the contrary, seems to be posed for relatively steady growth till 1800 in November, around which level it should fluctuate for few months (+- 50 ?) . New addition is that Gold in late January may briefly (few weeks?) return to 1580-1620 USD.

Kind of suggests may be more commodities will have relatively flat period from Oct-Nov till the end of the Year

Rui's picture

Jim Willie latest

Bay of Pigs's picture

Golden Jackass

Euroland & the Gold Rebound

"By the way, Operation Twist is a massive deception to enable foreign creditors to dump USTreasury Bonds. The hallmark of Quantitative Easing has turned toward deception, lack of transparency, and devious cunning scheming defense of the USDollar by whatever means. The past QE, QE-Lite, and QE2 kicked the USDollar in the teeth, knocked it down in value, and caused an extremely disruptive rise in the cost structure for the entire world. It was hardest felt in food prices. The USFed has been given direct blame across the world, complete with harsh criticism. So the monetary easing programs instead turned more secretive, as Global QE became the policy."

http://news.goldseek.com/GoldenJackass/1318442132.php

ivars's picture

@redwood-mining stocks

Have not done any alaysis of those, can not answer. Mining can be nationalized quite rapidly, its risky. Perhaps owning silver is risky , toosad

stephanie's picture

Spreading the Word....

Hey guys and gals!

I started a new topic in the Site Feedback forum to brainstorm ideas to get the word out about TF Metals Report!

Please share any thoughts or ideas you have there!

http://www.tfmetalsreport.com/forum/2663/ways-spread-word-about-turd

Thank you!

Bay of Pigs's picture

Sorry Rui

Missed you by one minute there. ;o)

Shill's picture

Meanwhile, as we await a more

Meanwhile, as we await a more confident outlook for a gradual pickup in economic growth --

Entire Bridge Stolen for Scrap

LongGoldLongSilver's picture

Another CCI Chart

Hey Turd, love your blog. What do you think about this long-term CCI chart? Support sure could break down anyways, e.g in a new Lehman event, but it still gives a pretty good view of the long term trend support, I think. But hey, I'm not a turd.

Edit: You were clearly not refering to the CCI, but the S&P! Well, well...it's still a pretty chart;)

GoldMania3000's picture

I say...

be prepared for volatility up and down. have cash and keep stacking. expect the unexpected. Today i say things go up and i usually get the impulse to buy. Today I didn't have it.  My brain and emtions said sell on the ups and buy on the downs.  You go through enough of these events you become conditioned. Not going to get excited unless we have a big down. Thats when you get excited.  I hope we do go down. We buy buy buy.

FFF's picture

Does this CCI thread cancel the Rally Cometh thread??

Is this latest relief rally the headfake before the EE FORKING or what?

Lots of outside bullish reversals being painted on charts.  Should we suspect the algos are creating these to disguise the "wolf in sheep's clothing"?

Awesomeness's picture

FAZ!!!!!!!

What a great day to pick up some cheap FAZ or calls.  You want to make money, buy FAZ on -10% days and sell on +10% days, the volatility right now makes this etf crazy fun to play.  Not to mention we're heading into some potentially bad times in October. 

Bad news for FAZ today:

  • SOME FED OFFICIALS SOUGHT TO RETAIN OPTION OF QE3, MINUTES SAY
  • SOME FED OFFICIALS SAW QE3 AS 'MORE POTENT TOOL' TO SPUR GROWTH.
  • TWO FOMC MEMBERS FAVORED `STRONGER POLICY ACTION' LAST MONTH

    But in order for any more QE to happen, the dow will how be head to like 9700 or below.  Seems like a good play for this month.

Katie Rose's picture

Illuminati Holidays and Silver/Market Massacres

First off I want to thank Turd for his outstanding leadership and his huge caring heart! I have been following this blog for nearly six months and am deeply moved by the maturity he brings and asks of us his readers.

This is my first post on the main board simply due to the fact that I have not thought I had anything of value to add to the discussion. I have learned so much from the rest of you.  I am truly grateful! I live on a small farm in Eastern WA, and quite frankly I am suffering from preparedness overload.

Today I am breaking my silence because I have been observing a pattern of market behavior since the May 1st beat down. At first I was in denial. Then I expected someone far wiser and eloquent to share this information. To date no one has that I know of. I realize that it is “out there” yet the facts speak for themselves. In short, what I have witnessed is this:

The silver market has been consistently hit for no apparent reason on Illuminati “Holidays or Holy Days.” These holidays are also human sacrifice days and certainly many families have experienced severe financial loss on these days due to the unexpectedness of the hit. It matters not if one believes in the Illuminati, the last two large price drops occurred on their special days.

Today’s CCI Chart posted by Turd is also very shocking. Print the chart, then take the dates I mention below and match them to the chart. There is an amazing correlation.

May 1st is the second highest Illuminati calendar date. It is called Beltaine. It is the day the USA bombed Iraq and many innocent lives were lost with its “shock and awe.” This is when I first became aware of the Evil Empire (EE) as the bombing was precisely at the day, hour, and minute that Illuminist's sacrifices were occurring in Washington DC. Our then Secretary of Defense bragged about it at a press conference the following week, even going so far as to state the hour and minute the first target was hit.

May 1st is Beltaine Festival, also called Walpurgis Night. This is the highest day on the Druidic Witch's Calendar. May 1 is the Illuminati's second most sacred holiday. Human sacrifice is required.

This is the day that silver was massacred and someone on the blog called La La lost over 100K.  There was a terrible toll for metal traders that day. My heart went out to La La.

June 21 - 22 - Summer Solstice

June 21 - Litha is one of the Illuminati's Human Sacrifice Nights

Again there was a waterfall attack. I believe that Turd even wrote in his commentary how disgusted he was at the silver manipulation and commented that “their Mother’s would be ashamed of them.”

July 19 - 13 days before Lughnasa

There was another beat down with no outside information to warrant the loss.

I find myself wondering if this was perhaps a signal for coming events in October as there was no market raid (that I remember for silver) on the actual holiday – just 13 days prior to it, as often happens for this particular holiday.

July 31 - August 1 - Lughnasa, Great Sabbat Festival.

One of the Illuminati's Human Sacrifice Nights

Nothing that I can remember happened to silver on this day. The information I found said that it is often celebrated 13 days prior.

September 21 - Mabon - one of the Illuminati's Human Sacrifice Nights
September 21 -22 - Autumnal Equinox

Isn’t it interesting that the big money meeting occurred over these two days and silver was drop kicked back to levels not seen in months?

October 31 - Samhain, also known as Halloween, or All Hallows Eve. This date is the Illuminati's highest day of human sacrifice.

This is why I decided to post at this time. We are coming up on the “holiest” day of the Illuminati calendar. Two market crashes here in the USA occurred within the 13 day window of October 19th - 31st.

These were Black Monday, October 19, 1987 (thirteen days before Oct. 31st), and October 27, 1997 mini-crash that began the stock market crashes in Asia. There was also a crash in October, Friday the 13th, 1989.

http://en.wikipedia.org/wiki/List_of_stock_market_crashes

Given the blatant, in your face beat downs starting on Beltaine, May 1st; I felt I could no longer keep my silence. I hope I am wrong, but so far since I have been watching closely, the two big silver massacres have happened on an Illuminati holiday. The biggest holiday of the year is approaching October 31st, and 13 days prior to it is October 19th.

I do believe these holidays need to be kept in consideration along with other factors (option’s expiration, etc.) in determining one’s trading strategy. I do not trade myself. I have learned from all of you that I am not smart enough to navigate this mine field called the market at this time. I keep dairy goats, grow a garden, and wonder how I am going to survive these inflationary times. My profession (real estate) has also destroyed by the EE. I am barely hanging on…

Please be careful. Like so many others on this site, I do believe we are in for a terrible ride this October 19th – 31st.

My information about the Illuminati Holiday dates comes from:

http://www.bibliotecapleyades.net/cienciareal/cienciareal20.htm

Most of what I have written about what happened on the specific dates comes from my memory. The chart that Turd posted today from Trader Dan shows a correlation that I believe goes beyond mere chance.

Now I’ve got to get back outside, as we are still harvesting from our garden.

Chicken Little's picture

This Could Be Huge

Repost: Apologies to those sensitive to board clutter, but I think this is significant. Got lost at bottom of last thread.

From ZH:

About 6 weeks ago, something changed. FCBs (Foreign Central Banks) not only slowed their buying of Treasuries, they stopped altogether, reversed course and actually began selling them. Three weeks ago their selling reached a level that I characterized in my weekly Treasury update for subscribers as "dumping." It was simply unprecedented. I opined that this could be the beginning of the end of the Treasury bull market, in spite of any effect that the Fed's new Operation Twist might have. 
 
 
 
Regards,         Chicken
FFF's picture

Credit Union question...

I heard what you guys were saying and after considerable research, opened  a CU account.  My choice of CU happens to offer safe deposit boxes.  I asked the question if they followed the same rules as banks (regarding SDB) and the response was yes.  Then I tried and failed to formulate the next question, so I am going to ask you guys who are much more in the know.

When the SHTF, will the contents of Credit Union safe deposit boxes be any safer than bank safe deposit boxes??

Bay of Pigs's picture

Economicfreefall

"The short covering has continued and you really have to wonder just how much can be sold by the speculators. They are holding close to unprecedented small net long positions and the overall picture has a bullish shine to it, not seen since 2003. And as far as I'm concerned you have trillions of more reasons to own silver today than eight years ago."

Silver 2003 London Fix, it traded from a low of $4.37 to a high of $5.96.

Now trading @ $32.50, and deeply oversold. Draw your own conclusions.

I Run Bartertown's picture

Never let a crisis go to waste

from Shill's 'good news' link frown:

http://www.theatlanticcities.com/housing/2011/10/suburbanization-housing-vouchers/284/

"Or even more radically, they could offer higher assistance for households moving to certain areas in an effort to encourage people to take on higher housing costs in order to be closer to job opportunities."

*Keynesianism with a twist of social engineering, add some blockbusting and let the serfs know that there will be no escape*  Only the Elites themselves will have a refuge from the social ills they create and nurture. To the rest of you - meet the new neighborsno

Tesla's picture

Silver OI (-2,721 total contracts) ...while price is flat

Daily Settlements for Silver Futures (PRELIMINARY)

Trade Date: 10/12/2011

Month

Open

High

Low

Last

Change

Settle

Estimated

Volume

Prior Day

Open Interest

OCT 11

-

32.100B

-

-

+.791

32.754

-

130

NOV 11

32.000

32.945

31.985

-

+.791

32.771

154

84

DEC 11

32.155

33.100

31.860

-

+.791

32.789

33,796

59,570

JAN 12

32.035

32.995

32.035

-

+.791

32.809

19

199

MAR 12

31.960

33.035

31.950

-

+.795

32.833

2,734

9,675

MAY 12

32.585

32.625

32.585

-

+.796

32.854

72

2,873

JLY 12

32.250

33.000

32.135

-

+.797

32.864

115

2,406

SEP 12

32.270

32.445

32.270

-

+.798

32.852

40

966

DEC 12

32.375

32.995

32.370

-

+.800

32.844

196

10,473

JAN 13

-

-

-

-

+.801

32.825

-

1

MAR 13

-

-

-

-

+.802

32.787

-

751

MAY 13

-

-

-

-

+.803

32.749

-

140

JLY 13

-

-

-

-

+.805

32.711

-

2,289

DEC 13

32.500

32.500

32.500

-

+.805

32.619

20

7,817

JLY 14

-

-

-

-

+.810

32.451

2

257

DEC 14

-

-

-

-

+.815

32.364

-

1,311

JLY 15

-

-

-

-

+.815

32.112

-

190

DEC 15

-

-

-

-

+.815

31.917

-

540

JLY 16

-

-

-

-

+.815

31.692

1

26

Total

37,149

99,698

Last Updated 10/12/2011 01:32 PM

LongGoldLongSilver's picture

S&P

...and I haven't even added all the domes that Clive Maund would have!;)

Tesla's picture

Gold OI (+3,458 total contracts) while price has fallen ~$12

Daily Settlements for Gold Futures (PRELIMINARY)

Trade Date: 10/12/2011

Month

Open

High

Low

Last

Change

Settle

Estimated

Volume

Prior Day

Open Interest

OCT 11

1667.1

1691.0

1665.9A

-

+21.6

1681.3

25

859

NOV 11

1665.9

1691.7

1665.9

-

+21.6

1681.8

333

488

DEC 11

1664.7

1693.9

1662.0

1681.0

+21.6

1682.6

101,389

269,305

FEB 12

1667.4

1695.2

1664.5

-

+21.6

1684.6

1,610

48,358

APR 12

1671.3

1695.7B

1669.1

-

+21.6

1686.3

369

12,687

JUN 12

1670.0

1692.7

1669.3

-

+21.6

1687.9

57

17,572

AUG 12

1671.9

1699.2

1671.9

-

+21.6

1689.6

72

7,457

OCT 12

1674.7

1693.0

1674.7

-

+21.6

1691.4

36

5,787

DEC 12

1679.5

1701.8

1679.5

-

+21.6

1693.7

1,211

15,264

FEB 13

-

-

-

-

+21.7

1696.2

-

3,392

APR 13

-

-

-

-

+21.8

1699.2

-

282

JUN 13

-

-

-

-

+21.9

1702.7

827

12,792

AUG 13

-

-

-

-

+21.8

1706.2

-

45

DEC 13

1711.0

1711.0

1711.0

-

+22.1

1714.0

339

12,211

JUN 14

-

-

-

-

+22.6

1728.8

-

8,158

DEC 14

-

-

-

-

+23.2

1744.6

120

9,020

JUN 15

-

-

-

-

+23.8

1764.9

25

6,016

DEC 15

-

-

-

-

+24.5

1786.9

165

6,767

JUN 16

-

-

-

-

+25.1

1811.2

12

109

DEC 16

-

-

-

-

+25.6

1836.5

775

1,484

JUN 17

-

-

-

-

+27.1

1863.7

25

37

Total

107,390

438,090

Last Updated 10/12/2011 01:32 PM

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