No Charts Today (updated with a chart!)
Because it's all just nonsense. The euro just dropped for no real reason. The incumbent rise in the dollar caused the metals to take the elevator down about 5 floors. Silver has broken through 28 and looks now to be headed toward 26. Maybe by next week we can begin to assess the damage The Cartel is inflicting. Until then, all we can do is watch.
Here's your euro headline, from ZH:
I found this next article on Harvey's site last night. It was also highlighted on ZH yesterday. You absolutely must take time to read it today if you haven't already. It's a challenging read in that there's a lot of economic stuff that, if you're not patient with it, can glaze you over real fast. My advice is: be patient with it. Take your time and read it carefully.
Just a few more words about OI and the gradual demise of the Comex. First, another link. This one is from JS Kim. He covers many of the things we began discussing here about three weeks ago. It's a good summary, though, and worthy of your time:
As we speculated earlier this month, total OI in the metals continues to decline. Gold looks like it may soon fall under 400,000 contracts. Again, what I believe we are seeing is a trend of investors and traders simply walking away from the Comex. After MFGRAP, why would anyone in their right mind buy and hold gold and/or silver through that system? The drop in OI will be gradual but over time, as participation wanes, the Comex will simply become less and less significant in setting the physical price of the PMs.
We all have high hopes that PAGE will accelerate this demise. News yesterday caused great concern that the opening of the PAGE may be delayed or canceled.
I've tried to get some additional information on this but I'm not making much progress. It seems to me that this is a crackdown, by the Chinese government, on non-governmental exchanges and PAGE is, of course, a government-sponsored entity. Let's hope that all remains on track for a Q1 opening. I will, of course, pass along any additional information that I am able to gather.
As I close, gold is at 1575 and silver is at 27.67. Yikes! I fear that there is more of this to come as The Cartel is clearly in charge this week. There simply aren't enough buyers to counter all of the Cartel selling pressure and, once stops get triggered below previous lows, prices can fall pretty fast. Silver made a low last January around 26.50. That would seem to be where it's headed now. I'm still hoping that 1550-1560 will hold as a bottom for gold. We'll see.
Hang in there. Keep the faith. TF
12:30 EST UPDATE:
OK, I lied. I can't help myself. Here's a chart. Actually, it's a repost of a chart from last week.
What I was trying to demonstrate here was that history shows us how gold responds when it hits the main trendline. It has never sharply rebounded. Often, as denoted by the arrows, it skips along the line for 2-4 weeks before moving higher and away from the line. We are seeing the same thing play out today.
Of course this comes with a caveat. The MFGRAP may be changing the rules on this thing. IF gold drops convincingly through 1550 and heads toward 1500, all bets are off. IF, however, this primary trendline continues to support gold (as I think it will), then gold should stop somewhere between 1550 and 1560 before finally rebounding sometime in the next 2 weeks.
Obviously, we are at a critical moment in determining the future trend of paper gold. Watch things closely. TF