Taking a Licking. Still Ticking.

Another series of ruthless attacks have left the precious metals battered and bruised but they are still standing and looking like they want to continue moving higher.

First of all, a quick update to our Open Interest situation. Do you recall the trading action of Friday? Gold was down about $17 and silver fell about 60 cents. In a "normal" market, you would expect the gold open interest to have been stable to slightly down. Why? Because a $17 down day would prompt some longs to sell and close positions but, at the same time, fresh shorts would likely initiate new positions. The two would almost cancel each other out. Late today, we found out that the total gold OI increased by almost 7000 contracts on Friday. I'll state that again so as to ensure you didn't miss it: Gold OI increased by almost 7000 contracts on Friday!

Friday was a ridiculous and clear attempt by The Cartel to contain price. You can see their work on this chart that I posted this morning:

paper_1-17amgoldh_0.jpg

The battle continued to wage today. After rising to $1666 at the Comex open this morning, gold was immediately attacked by the Jackals. It was pounded in the first few minutes of trading and then again, right at the close. Typical Cartel nonsense and bullshit price suppression.

paper_1-17pmgold5.jpg

I will be flabbergasted if we don't see another, significant jump in OI tomorrow (for today's trade). Lots of new shorts were thrown at gold in the first few minutes today. The OI action throughout the day was most likely neutral. Then, even more new shorts were thrown at gold right at the close. As of the close Friday, total OI was 425,244. I expect tomorrow's reading to be closer to 430,000. Since today was Tuesday, I'll be quite interested to see this week's CoT numbers, too.

As has been the case recently, the silver OI picture continues to look more like a "normal" market. While silver was shedding 60 cents on Friday, the OI declined as you'd expect, from 103,877 to 102,835. Today, the price of paper silver tracked pretty closely to paper gold as silver was also attacked at the open and the close of the Comex. As much as days like today hurt, the OI tells me that the EE is continuing to slowly exit the silver market. Patience in silver will be greatly rewarded in 2012.

paper_1-17pmsilv5.jpg

Obviously, the Criminals have been intent on hammering and suppressing price but they're not making much headway. Additionally, lease rates continue to be stable so there does not appear to be an abundance of gold for The Cartel to supply.

paper_1-17pmlease.jpg

In the end, if I am right and the bullion banks have an intermediate-term goal of reducing/eliminating their massive, short exposure to silver and gold, then all of these fresh shorts in gold are eventually going to have to be covered. Gold will rally through 1660 and then tackle 1680. Soon, we must prepare it for The Battle Royale of 1700 and the down-sloping trendline from the highs of early September.

paper_1-17pmgoldd.jpg

With each passing day, confidence is growing that silver has broken the trendline from its highs in September. With that accomplished, it must then rally through $31 and $33 before it can attack its real nemesis, the trendline from the highs back in April. Getting through "Line #2" is extremely significant, though, so be happy and optimistic. As long as silver is above that line, the chances for another collapse in price are remote.

paper_1-17pmsilvd.jpg

Lastly, four items for your consideration. First, another Eric King update from his "London Trader". For obvious reasons (namely inaccuracy), I don't put a lot of stock in LTs short-term price projections. However, since he/she mentions so many of the points that I've been making, I thought I should include it here:

http://kingworldnews.com/kingworldnews/KWN_DailyWeb/Entries/2012/1/17_London_Trader_-_Staggering_Gold_Demand_Creating_Shortages.html

Here's an update from Egon. Please take the time to read it.

http://kingworldnews.com/kingworldnews/KWN_DailyWeb/Entries/2012/1/17_Von_Greyerz_-_Silver_Shortages_%26_Gold_to_Accelerate_Higher.html

This next item is certainly thought-provoking. As with all Glenn Beck stuff, please ignore the messenger if you must but try to listen to the message. Maybe this is nonsense but it seems worth consideration at the least:

http://www.glennbeck.com/2012/01/17/was-the-2008-economic-crash-intentional/

And here's something that I posted in the comments of the earlier thread. Good stuff.

http://www.zerohedge.com/contributed/gold-silver-banker-cartel-prolonged-price-suppression-has-set-foundation-explosive-move-

Look, the financial world is hanging by a thread. Downgrades and devaluations are rampant. Greece is said to be very near default. Gold is being actively suppressed for a number of reasons but this latest scheme has nearly run its course. Be patient and you will be rewarded with massive amounts of fiat that you can then exchange for even more physical metal (if you can actually get it wink). Relax and have a great evening.   TF

105 Comments

Shnozberries's picture

hmmm

hmmm

Clubfoolish's picture

Did you know that gold will become 'worthless? Yes...read on...

What a tool this guy is!!

http://seekingalpha.com/article/319486-why-gold-related-investments-are-slowly-becoming-worthless?source=yahoo

...snip...

"Where is the price of gold headed?

The basic answer is that in the long run the price of gold can only go down. And it will keep going down until mining virtually stops. This will occur as the world's economies and banking systems continue to modernize and gold long-held in vaults to back currencies comes on the market. As it stands, in the long run the price of gold will almost certainly fall as the supply in the market continually increases far faster than the demand."

Dr G's picture

Like Turd, I'm extremely

Like Turd, I'm extremely comforted that silver is still above that downtrend line from the September highs. It confirms what I believe about the white metal.

Be Prepared's picture

4th-o-rama .... at least I'm not O-bama!

I'm still seeing the strong potential for another move down to retest for consolidation and maybe even take it to the 22 / 1450 level.  I wish I had a better handle on the timeframe other than 1st quarter (end of March) 2012, but it's not based anything other than projecting where the inverted tea cup handle formation finishes before springing on a move higher.

Like most of you, I will be looking at the day-to-day trends because they are controlling all the gates and they own all the keys to this market.... at least, for now.

Turd.... thanks for putting together a great post.... really appreciate all the hard work!

Turdite-in-Training...

ReachWest's picture

Silly Newscast for Tuesday.

Thanks Turd - Certainly look forward to seeing that "Battle Royale".

Here is another Turdville Newscast .. this one focuses on the MF Global moral hazard and has another silly "Get Real Gold" ad.

PS: I watched that Glenn Beck newscast that Turd refers to. I wouldn't dismiss it, outright. There are some substantial and thought provoking possibilities in there. As with all things in this weird and oddball excuse we have for an economy, the real true picture (which no one will every really know) is probably a mix of conspiracy theory A, plus B, plus C, and a little D.

Be Prepared's picture

Sprott announces new platinum, palladium fund 16th January 2012

Sprott takes another step to bring metals to the masses!

Sprott announces new platinum, palladium fund 16th January 2012

Sprott Inc is to launch a new $115 million physically-backed exchange-traded fund (ETF) investing in platinum and palladium.

It will allow retail and institutional investors to gain exposure to metal spot prices without having to collect and store the metals, Reuters reports.

The ETF will be a long-term consideration and will not involve short-term speculation on price fluctuations, according to a preliminary prospectus lodged at the US Securities and Exchange Commission last week.

Differing from traditional ETFs that issue and redeem units daily, the Sprott fund will allow investors to redeem a minimum of 25,000 units on a monthly basis and can redeem the physical metal.

Strong demand from the auto and jewellery markets in recent years has resulted in the price of platinum doubling over a decade.

Similarly, industrial and consumer interest in palladium has caused its value to surge three-fold over the last ten years.

Sprott will issue 11.5 million shares worth $10 each. Reuters notes that this would equate to around 7,666 oz of platinum or 18,200 oz of palladium.

Output in 2010 was 6.05 million ounces of platinum and 7.36 million ounces of palladium

Figures from Johnson Matthey show 10,000 oz of physical palladium and platinum equates to 0.13 per cent and 0.11 per cent of global supply in 2010.

The metal will be held at the Royal Canadian Mint.

Patrancus's picture

Time or X

Takes a licking and keeps on ticking

I have neither the Time nor the X 

Be Prepared's picture

Sprott announces Follow-on Offering of PSLV....

Sprott Physical Silver Trust Announces Follow-on Offering of Trust Units

TORONTO, ONTARIO -- (Marketwire) -- 01/17/12 -- Sprott Physical Silver Trust (the "Trust") (TSX: PHS.U)(NYSE: PSLV), a trust created to invest and hold substantially all of its assets in physical silver bullion and managed by Sprott Asset Management LP, announced today that it has launched a follow-on offering (the "Offering") of transferable, redeemable units of the Trust ("Units").

The Trust will use the net proceeds of the Offering to acquire physical silver bullion in accordance with the Trust's objective and subject to the Trust's investment and operating restrictions described in the prospectus related to the Offering. Under the trust agreement governing the Trust, the net proceeds of the Offering per Unit must be not less than 100% of the most recently calculated net asset value per Unit of the Trust prior to, or upon determination of, pricing of the Offering.

Sprott is going to be really careful about the current premium so I think he will do this in steps....maybe $200-$250 million at a clip and monitor how the market reacts.... I don't see him doing this in all in one great big plunge.

retireyoung's picture

Tyler

I am answering your thoughtful message in this thread.  I just wanted to thank you and you did make me think.   Thanks again.

vamoose1's picture

@ be prepared.PSLV

Thanks for publicising this, how did he get around the premium?  maybe it was a straw man, and that the demand for safely located fizz is such that its irrelevant. 

   You are so right, we need to  sleuth arond bay Street a bit,  HEY!!   I volunteer,  .

   What is so funny about this is we all felt stymied, very  discouraged,  the board was flat. 

    Thats when things happen..................................................  thats funny,  lets stay cool, this is obviously very good, i will stay cool though. 

upNabout's picture

I don't get it!

Can any of you that have knowledge with NUGT explain why its not following gold as its supposed to? Last few days it has been off!! If you know of a worthy place to read into this ETF it would help me. I love you guys! Learning everyday!smiley

Astro_Phyz's picture

Turd's attitude as a leading indicator

If gold and silver prices follow Turd's attitude as a leading indicator, I think that "explosive move" ZH refers to will happen soon!  Glad to see Mr. F in better spirits, lest I say the best spirits IMO, since the September smackdown.  I purchased my first silver bullion bar, a 10 oz. from Provident, near the local low last week.  Can't wait to hold the precious smiley

Little by little, we are whittling the cartel's position of power and price suppression away by hoarding phyz.  I have faith that we will all be very happy with the fiat-worth of our stack in 2012.  Keep stacking Turdites, and keep prepping too, as the world continues down the path of SHTF type geo-polital scenarios.

GoldMania3000's picture

sprott offering

I called global to find out since im a client. In the US they are offering very small but the total is probally as someone said on the board $200m to start off with. premium is lower then what it is normal. but this is a good sign!

¤'s picture

Lunch time slap down

That was a nasty little slap down at a non-typical point in the day.  Pretty much 12:30 on the button and then they jerked the price down again  at 2:30 for the close of crude oil I think.

I see a little pre-Asian/Sydney market bump up just happened. It would be nice to see a serious  tug of war between the Asian/London/NY markets. 

I'm pulling for Asia right now to yank it higher. 

jonoso's picture

turd's post today

love this kind of post   almost like a story   but   based on  imperical observation   super interesting  .........................

stephanie's picture

Glenn Beck / GBTV Episode

Please don't hate me, but I get GBTV on my Roku because I was curious as to what Glenn Beck was up to, and I've actually been enjoying it a lot. I do *not* agree with him on everything! (I totally disagree with him about Rick Santorum.) But I saw the entire Glenn Beck episode that Turd's link above was taken from last night. If you can watch the first hour of that broadcast (Monday, January 16), I'd recommend it. It was excellent.

(I know Glenn Beck is a controversial figure, and Ron Paul fans are not happy with him, because Beck does not like Paul's foreign policy. FWIW, Beck has been saying lately that he's 100% on board with Paul domestically and that he's the only candidate right now talking about the Fed. It's something.) 

At any rate, Beck covered the "technocrat" dictator that was recently installed in Italy, and explained MF Global in a way that any idiot could understand it. He then did the interview with the guy linked above about whether the financial crash of 08 was a planned attack on the U.S. 

He also told everyone to read ZeroHedge and even put the URL up on the screen. (Would be great to see TFMetalsReport.com up there!) He said that if everyone in America knew what really happened at MF Global, there would be bank runs and chaos as everyone would want to take their money out of all their accounts.

Whether you think he's a total tool or not, I think it's great that he's getting this alternative info out there.

So he's not right about everything, and I'm sure he annoys the crap out of some folks here. But he's one of the few well-known media personalities talking about any of this stuff. That's positive, as he's helping wake people up.

Tomorrow GBTV's reality show about the prepper family is starting. I'm looking forward to it. :-)

Lord Koos's picture

17th!!!!

17th!!!!

AU closing above 1650, AG above 30 is good.  Hopefully they will end the week up from here.

bernard's picture

Platinum will shine brighter

Platinum will shine brighter than gold... trust me on that... hold an ounce of platinum in your hand, and then you'll know. It's the stuff of Demigods.. PAGING Mr. Chilton et. al .... look at the manipulation... what a bunch of shills. Remind me again what we pay these people for? 

----------------------

http://comparegoldprices.com | http://comparesilverprices.com

vamoose1's picture

PSLV

If  memory serves,  PSLV  1.   started out at 250 as well, and like Topsy,  it grew.  To 580. Evidently the stock is down  7  percent as we speak, putting the premium at 16  percent,  which is one hell of a lot more palatable than  34.22. 

   But the suggestion that he might piece into this makes sense, I am comfortable watching. Its not negative.

   IMHO,  the silver market is a lot tighter today than it was in November 2010,  when the first PSLV got done so  lets see what kind of demand there is. 

   Equivalently,  JPM is arguably smaller, they got badly caught short last time, which is why it went exponential,   and this one is well telegraphed. Fool  me once.......

   Lets call it a good start and watch.Its a lot better than where we were this morning.

turdy's picture

Its not a beat down if gold

Its not a beat down if gold stays above $1650.

Be Prepared's picture

Everything rises on Optimism!

Crude Rises a Second Day in New York as Reports Boost Economic Optimism

Oil rose for a second day in New York after reports yesterday bolstered optimism in the U.S. and German economies, increasing speculation by investors that fuel demand will climb this year.

Crude for February delivery rose as much as 41 cents, 0.4 percent, to $101.12 a barrel on the New York Mercantile Exchange. The contract settled yesterday up $2.01, or 2 percent, at $100.71.

___________________________________________________________________________

Be Very Wary of Optimism expressed in MSM.... It's like they do this to lure the retail back into big positions and then slam them hard for the take down.....it's what they do!  If we get a little pop..... I'm all for it, but I'm always looking for the exit when it comes to equities nowadays!

madtig6's picture

10 year gold chart

With 1683 being a previous resist and a previous support along with the 38% fib retrace, I'm holding that as the next strong resistance.

http://stockcharts.com/h-sc/ui?s=$GOLD&p=D&yr=2&mn=0&dy=0&id=p83812669268&a=248236006

Be Prepared's picture

upNabout - NUGT and XAU Correlation

I don't get it!

 

Can any of you that have knowledge with NUGT explain why its not following gold as its supposed to? Last few days it has been off!! If you know of a worthy place to read into this ETF it would help me. I love you guys! Learning everyday!smiley

NUGT is a 3x Miners Bull Market ETF........  this ETF isn't always going to correlate directly and responsd to the price of gold alone, because the cost of production (oil cost) and other factors will be reflected into it's valuation.  Additionally, the composition of the fund will also effect how this ETF moves with or against the market.

NUGT currently:

Index Sector Weightings

Gold 92.30%
Precious Metals & Minerals   7.70%

Index Country Weightings

Canada 60.00%
United States 20.00%
South Africa 13.33%
Jersey 3.33%
Peru 3.33%

Let's take a quick look a chart comparing Spot Gold with NUGT:

Photobucket

Generally, NUGT would be for a short term play, especially in today's market, because of it's 3x leverage and the decay associated with each up and down cycle.  I hope this helps... I'm sure others will chime in with their thoughts as well.

Eric Original's picture

NUGT is 3X MINERS, not

NUGT is 3X MINERS, not 3X GOLD.   Two different things.  It's been doing a pretty good job of tracking 3X Miners.

Be Prepared's picture

EO - Love how you get to the point

while I ramble.   :-)

Tyler's picture

RetireYoung

No problem at all.  Looking forward to your posts in the future.

Katie Rose's picture

Lindsey Williams on in an hour

Lindsey Williams will be interviewed here:

http://justmeasurescs.com/?page_id=18

at 6:00 PM Pacific Standard Time.

What is unusual about this interview is that you can call in with questions. I called in last month and was helped by Lindsey's reply.

The web page is different in that two speakers come on at once. You need to silence one of them or the sound will drive you crazy. One is for 32 K players, the other for 64 K players. Just move the audio on one of them to the left to silence it. Sanity will be restored.  wink

The program will be archived in the event you are unable to listen live at:

http://justmeasurescs.com/

SteveW's picture

@Be Prepared NUGT

Great charts and explanation on NUGT.

Since its 3X daily levered on NYSE Arca GoldMiners Index and GDX is unlevered on the same index then a chart comparing these two would show the impact of leverage and the shift from 2X to 3X in December. I either don't know how to overlay or don't use the right resource. Thanks in advance if you either do the chart or tell me where to go. wink

I Am The Unknown Comic's picture

Reading Railroad

@punchbowl - Thanks!  I would think that anybody who is short C and/or invested in FAZ or other such instruments would simply delight in reading the Citibank financial report out loud while the local Citibank branch manager counts their coins out in order to complete a transaction.....especially this kind of "additional mortgage payment" that might as well be called a "margin call on customer accounts" given that Citibank misallocated my customer funds and then "put a gun" to the head of this customer in order to cough up additional cash within one business day "or else" there would be more fraudulent late fees.  

Gosh, what a bunch of mafia thugs these guys are.   Actually, no, it is an insult to the mafia to say that because at least the mafia has a code and set of rules that they live by, unlike the TBTF banks.  So, I take it back.  The mafia is actually better than the TBTF banks in terms of adhering to agreements of contracts.  

For those of you who have not seen the previous thread on this and thus may be bewildered, here's a re-post of this TF Metals Report post on the thread "Getting Ready For A Big Week"    

"Dear Turdland,

I had a most enjoyable experience today that I want to share.   I would also ask any of you who know how, to please send this info to zerohedge as a guest post and/or 4closurefraud.org.  

I'm old.  Mrs. Cat and I have 1 property left with a mortgage on it (at 2.9%, so that's why).  Recently CitiMortgage has pulled a MF Global maneuver and misallocated our payments, resulting in a large overage in our escrow, as well as a cash position in what Citi calls an "Unallocated Funds" fund which they have been holding for who knows how long.  Here's the kick....they have charged us $487 in late fees and $128 in delinquency fees all the while they have been holding on to our money.   I believe they have done this in order to beef up their deposits on their balance sheet, as well as their accounts receivables for their annual report (i.e. I bet this is widespread and not just us).   

So, as they have misallocated my customer funds, I went in today to pay even more money so that the mortgage remains current.  

I decided to tap Mr. Piggy for help.

Mr. Piggy couldn't fit underneath my winter coat so I poured his contents out into a 1 gallon ziplock bag and stuffed that in my coat. (don't worry I already checked all the coins for anything of any value and there's not much but zinc in there).

I went to the Citibank teller window during peak lunch hour.  

I pulled out a wad of mixed fiat paper and started counting out the 1's, 5's, 10's, 20's, 50's and 100's in the random order in which they popped up.  The teller insisted I just hand her the wad and let her count it and I insisted "NO, it is my money."  

When I got within $20 of the payment I reached into my coat and pulled out my ziplock bag and dumped all the coins out into her little tray beneath the bulletproof glass of her teller window.  

The teller freaked out.  She said it wasn't her job to count those coins and since Citibank didn't have a coin counter that I would have to roll all the coins and come back.

I refused.  I have arthritis.  I can't roll them.  I asked her why she had a problem counting legal tender coin and asked for my receipt of payment. 

After 10 minutes of this she got a manager to come out.

The manager scooped up all the coins and took them and me back to her desk where she counted them all out and rolled them.  That took a while and I just grinned from ear to ear watching that bank manager count and roll the coins from Mr. Piggy.  

We went back to the teller (as first priority customer thus jumping the lunch hour line) and then they spent another 5 minutes re-tallying the totals of bills and coins in various denominations.  I had a check ready in case I came up short but didn't need it because I had more than what was due.  So I told them to apply the extra coinage towards an additional principle payment and that took them more time.

All in all it took them nearly 45 minutes from noon to 12:45 pm during lunch rush hour.  Their other customers were upset as they waited during their lunch hour on the day after a holiday.

I learned something else valuable along the way and that is that the teller will count out the change as long as no denomination can make a roll.  So, from this point forward here is how I will pay any bill at a TBTF bank:

$9.75 in quarters

$4.90 in dimes

$1.95 in nickels

$0.49 in pennies

(that totals $17.09)

plus low denomination bills such as $1, $5 and $10 and a check for the rest.   

It will be easiest to do if I go to another bank just beforehand and buy one roll of each coin (penny, nickel, dime, quarter) and open each up and simply take out one coin from each roll and then dump the rest into a co-mingled ziplock bag or cup. 

Then I will watch with delight as that teller at that damned TBTF bank spends their time during peak traffic hour counting my $17.09 in change.  Today, I used the time as an opportunity to read out loud Citi's dismal earnings report, just in case other customers in the bank wanted to hear how much they suck.   

So, next time you pay a bill to a bank, go to the bank to pay it, and pay it with max change.   

Now that my friends, is change I can believe in.  

The manager offered me a free Citibank wallet and still wants me to open a checking/savings account with them.  I guess I'm known a little too well as a landlord in the community.   

What a wonderful world it would be if we all took our lunch hour to do this.  It was one of the best lunch hours I ever had and I still had time for a 6 inch tuna sub at Subway across the street.

I think it would be a good idea to start printing T-shirts that say "$17.09"

SteveW's picture

@EO NUGT

"NUGT is 3X MINERS, not 3X GOLD."

Quite true but if you overlay NUGT and GDX you'll see that NUGT had a big relative drop mid-December, which I attribute to a lot of day to day volatile swinging. Haven't checked the day to day closes and I can't link to the chart I used.

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