Caution For Monday

Just a quick warning for early next week as I do not like the way things traded today.

Several things concern me for PM prices early next week.

  1. Gold and silver rose yesterday and broke through resistance on good volume and increased open interest.
  2. In light of today's action, this looks like a trap that was set by The Forces of Darkness.
  3. The PMs were pressured all day even though the POSX sold off all day and finished basically unchanged.
  4. Other "risk assets" such as stocks and copper traded higher all day
  5. Gold was then raided for $15 on the Friday afternoon Globex.
  6. Notice on the chart below that this raid occurred before a small Pig rally. Not during or after.
  7. After steps 1-6, does a Friday afternoon raid indicate that someone got word of a pending Cartel short-selling attack for Monday?

So, anyway, we'll see. DO NOT BE SURPRISED, though, if the metals take it in the shorts pretty good on Sunday night and Monday. IF they do, look for gold to drop to 1720 and potentially even 1705-1710. Silver will likely fall to 33 and even 32.80. At those points, both will present rather compelling buying opportunities.

paper_2-3pmgold5.jpgpaper_2-3pmpig.jpg

paper_2-3pmes.jpgpaper_2-3pmcop.jpg

At any rate, I hope I'm wrong and everything springs higher on Monday and all of next week. However, with both metals overdue for a little pullback and with the action we saw today, we should all be mentally prepared for some tough action early next week. 

TF

142 Comments

tranquillity's picture

Killing #1

Killing #1

FleetFeet's picture

TEOTWAWKI

What most people don’t seem to realize is that there is just as much money to be made out of the wreckage of a civilization as from the upbuilding of one. 

                                                           Margaret Mitchell 

ink's picture

This was the catalyst for gold and silver raid

(see 19.39 entry)
 
"James Bullard, president of the Federal Reserve Bank of St Louis, has said the US may need raise rates before 2014. He added that the surprising strength of the country weakens the case for more QE and unemployment may decline to 7pc by the end of 2013.
He told Bloomberg:
“The economic news and economic data, including today’s data, has been surprising to the upside. I need to see significant deterioration in the economy and some threat of deflation or inflation moving significantly below our inflation target before I would consider more QE. Inflation is coming down but at least for now it is above our inflation target [of 2pc]. We will see how things develop. But I am also more bullish on the economy as a whole. I do think we have momentum coming out of 2011."

http://www.bloomberg.com/news/2012-02-03/fed-s-bullard-says-surprising-u-s-data-weakens-case-for-bond-purchases.html

treefrog's picture

grafitti

seen on a bathroom wall at a black run convenience store in a predominantly black neighborhood in perry fl today:

"Obama lies and your freedom dies."

is obummer losing his core support?

draft allen west for keynote speaker!

imagine hundreds of dems soiling their linen.  thousands? millions?

RaRaRasputin's picture

Rather compelling buying opportunities

Always looking for those kind of opportunities these days Turd as who knows how long they might continue?

If the dip happens I'll be BTFD for sure

Have a great w/end!

RaRa

averagejoe's picture

Hey All

Kind of glad to hear a raid maybe coming. I want to BTFD. 

JimmyTheHand's picture

The Forces

The Forces of Darkness were out trolling around with their little HFT programs and "Get out of Jail Free" cards today. 

Here is a little perspective though for the year:

Silver @ 33.63 is UP 16.78% YTD

Gold @ 1,725.55 is UP 7.98% YTD

s2man's picture

I meant to warn you...

Today was my day to go to town and visit the LCS.  I forgot to warn you.  It always spikes just before I buy, or dips just after.  I apologize for not notifying you all, so you could plan accordingly.  TPTB must find my monthly buys a threat.

SilverHawk's picture

Saturday

Regardless of what happened this week or what might happen on Monday, I'm still going to the local shop to stack tomorrow!

cpnscarlet's picture

And What Avout Iran

And this is the action we get on a day where the news should be a slam-duck for PMs to rise. AS WC Fields said while spying a twisted pool cue, "Show me something is this place that ISN'T crooked!"

Dr G's picture

Blythe, FU. Not FUBM, just

Blythe et al, FU. Not FUBM, just FU. Plain and simple.

Have a good weekend Turdites.

EDIT: I hope you all saw it at the end of the last thread: brotherjohnf has had his website suspended due to a TOS violation. Yeah, a violation such as showing others about the red pill. Gimme a break.

Dr Durden's picture

Numbness

Got a very unsettling numb feeling today on the jobs report that I haven't felt since the S&P downgrade of the US last summer.

We are quickly approaching a level of max denial and complacency. It's simply mind blowing to watch it all happen in real time. When the tide finally turns, I will laugh till I cry because of the sheer emotional whiplash. 

Major stress tests still to come and the patience needed to get to the other side will be unreal. 

Lord help us all. 

Be Prepared's picture

The Lost People

In many ways, most Americans are part of the Lost People.  We are part of the Lost people because our most defining document, the U.S. Constitution, sits behind heavily guarded glass and steel with few bothering to read it and understand all it was meant to say and for whom it was meant to protect.....

The Lost People are the 1,126,000 jobs lost in the last two (2) months..... when you peel back all of the crap...the truth is exposed and is there for all to see.... there is no recovery.  It's nice that the Government, through the hocus pocus of birth/death rate formula and the retail temp job pump for the holiday season, is making it like OBummer is leading this country to a new and promised economic land.  OBummer actually had the audacity today to tell Congress not to screw up the recovery because he's doing such a great job.....what a sham and all for his desire for another 4 years of his power ego tyranny.

SEARS, BANK OF AMERICA, AMERICAN AIRLINES (13,000), BARCLAYS, MORGAN STANLEY, MICROSOFT, HSBC....these are all companies that plan to cut jobs....granted most of them are banks....so we could say thank goodness, but every job is starting to matter as the dominoes seem to be falling... The list is endless....

There is nothing in our economy that is set to flourish.  We are under the misconception that given the right circumstances....industrial jobs could come flooding back to this country and that is just not the case.  It takes decades to build the infrastructure, the worker skill sets and the distribution networks required to become a manufacturing base.  When the Chinese can mobilize 6,000 workers at the drop of a hat to make the necessary line changes for the new Apple IPhone in under 24 hours.... it's obvious that we can't compete with that type of set up.  Those workers are just a hair above slaves..... are we willing to go back to those type of conditions to compete?  Most likely not.... but Money flows where the opportunities are and, even more so now, that we don't bother to protect even our most critical industries from being sent overseas.  We are facing an absolutely tough economic road ahead of us because... most of the world...is doing it better and faster than we are....  I am not saying we are out of the game...just that our elected leaders are hell bent on making sure we end at the bottom of a very long barrel.

The Lost People are still asleep because the government has done much to cushion them from the reality of the abyss of poverty, but how long can you keep over 20% of your population on the dole....pay out over 30% for interest on debt service.....and face the biggest wave of Social Security claims this country has ever experienced...without imploding or reneging or revaluing.  We have painted ourselves into a corner and there are no ways out they aren't extremely messy. 

We have $16+ trillion reasons to know that every move we make and every step we take has to count.... there's just not enough time to dilly dally anymore, my friends.  A careful and methodical plan must be crafted..... where you complete an honest and thorough assessment of your current reality.... what smart steps can be taken by squeezing the best value from every red cent you have to ensure that you are prepared and covered by the insurance of your preparedness.  It's not enough to just be Awake..... you have to make sure that you're not Lost as well.

*Missed the New Thread.... repost

Biochar's picture

is it any surprise?

The most heavily manipulated NFP # in history combined with a smackdown in gold...

MOPE deluxe...

Economy Good = Gold Bad

I have to keep reminding myself there are many preppers out there who arrived late to the PM scene, who need a bit more time to stack, and the beatdowns are a blessing for them

¤'s picture

Towing the line at $1725

Gold just buzzed along that line for the rest of the day after that 3:00 plunge with hardly any variance. At least silver was able to nudge up right the market close. Gold didn't budge.

We've had some pretty strange trading days going on lately where the USD is up and gold is up at the same time or the S&P is down and the miners are up big time. No rhyme or reason lately and it doesn't seem tied to anything the way it used to be. Heck, the dollar zipped up and gold hardly budged a couple days ago.

Strange stuff. Not sure what any of that signaled.

I thought maybe a margin hike. Nada.

Talky Tina's picture

Key Outside Reversal Day?

Hi all,

I'm sure someone already covered this, but didn't we have a higher high in gold today but closed lower than yesterday?  I believe the high yesterday was 1764 and the close was 1759.3.  Today we reached 1765.9 but closed at 1744.8...1729 on the Globex.  Isn't this considered a "key outside reversal day"?  Somewhat reminiscent of August 23rd last year?  Maybe just something else to be wary of on Monday. 

Cheers...

s2man's picture

@JimmyTheHand

RE: Silver perfomance.  I told a friend today that I had picked up some more 90% coins.  She said, "Too bad silver doesn't pay dividends".  I wanted to quote silver's performance YTD, GSR, and potential shortages, but I just bit my lip and said, "Yeah, and you can't eat it, either".  She thought it was funny, but had no idea how sarcastic I was being.

Be Prepared's picture

Energy Drives the Economy

We all know that energy drives this economy...literally.  The more we produce....the more jobs we have.....the more gas we consume.  So, of course, that gas needs to be produced and is usually produced to meet demand or, at least, in close proximity to that range.  Take a look at the chart below and you will understand just how much our economy is NOT recovering...

Supplied Gasoline is in severe decline because we are driving fewer miles due to people not needing to for employment.  Even if you account for better gas mileage and production delays, the chart still makes a very clear statement about the "current" state of our economy.

bullwhip29's picture

A drop to $1720 or even $1705?

If TF is correct and a serious EE smackdown (of the Aug 2011/"QE3 off the table" variety) is coming then we're most certainly going to see prices < $1700 in short order. I mean we we're looking at prices in the $1650's just a couple of weeks ago, weren't we? IMHO, this seems like a logical target initially.  Just remember what Santa said about $1764.  We've been through this bs countless times before, so it should not come as any big surprise. If this turns out to be the case, the chart would take on a whole different look altogether with the series of lower tops being continued.  Overall, I agree with TF that something didn't smell quite right today as everything else was ripping higher while the PM's were being blatantly shot down like clay pigeons. Anyway, I hope we are not sitting ducks come Monday morning. 

MetalShawn's picture

Stackin'

Pretty good discount today, based on previous couple.  So stacked both of the shiny things today.  Investing for the long haul, so can't worry about dips in the road.  Stackin' and feelin' good.

Ojibwemowin's picture

I believe we are going to

I believe we are going to have a lot more time to stack....n the short term there will likely be fairly regular dips that occur as forces loyal to the status quo prop things up, thus metals go down, especially in an election year. This action is great for those of us who would rather put their fiat into tangible things over a relatively long period of time. Our plan is based on buying in on drops with 10-20 percent of dry powder on a regular basis during the entirety of our working careers. We are hedged with a 401K and pensions invested in large cap and multinational stocks, as well as base metals and materials in our private investments (steel, tin, copper, aluminum, etc).  Guns, hunting/fishing equipment, ammo, tools, etc are other metals/materials are other things we are heavily invested in.  

We are looking forward to watching the super bowl with family and friends around the fireplace with good food and drink this weekend.   Congratulations and good luck to all the Giants and Patriots fans....From a long suffering Vikings fan who remembers watching the last two super bowl losses, along with assorted championship game loses along the way. I still miss Bud Grant. 

Eric Original's picture

Stand Up

In small ways or large, we all stand up.  Good luck Sunday night everyone.  I was buying today.  If we are down, I'll be buying on Monday.

SuperLeggera's picture

3%+ Copper?

Hedge Funds loading up on Copper?  What an odd rally when looking at the "official" payroll numbers.  Maybe they're expecting a major Coronal Mass Ejection that will require a lot of it to rewire half of this dysfunctional planet.  Still, I'll never say when SHTF, "Better Red than Lead".

.....now where did I put that bottle of Pe5?

Turd Ferguson's picture

Nice call, Tina!

MODERATOR

I'll check that out and discuss it in my comments on Sunday.

Dr Jerome's picture

Too bad silver doesn't pay dividends

Neither does AAPL, but the same people will tell you what a wonderful stock that has been. People hear a line of argument that they think sounds clever and makes sense to them because they don't know the facts of a situation. Then they repeat that argument figuring it makes them  sound smart. "Silver doesn't pay dividends" only makes sense to the person who didn't buy any.

The world is changing right before our eyes. With negative interest rates looming, will  corporations keep paying dividends? Or will they lower them? And as the economy stays in the rut, as the bottom line gain from layoffs and squeezing the employees finds a diminishing return, will corps remain profitable and cut dividends altogether. Where is anyone who doesn't believe in PMs going to invest their money where they will find a "real" gain.

I may trade a bit here and there, but the bulk of my assets is staying in physical, land and a wind-solar energy system for my home.

beach_bum's picture

@Be Prepared

The Lost People - Great post and very worthy of reposting to this newer thread.

cpnscarlet's picture

Sasha - Not quite an LOLCat

dropout's picture

Shadow Stats Charts

This is re-post, but is important. I posted this same link under the pod cast thread. Click on the link to Dr. Paul Craig Roberts site to view John William's latest work.

http://www.paulcraigroberts.org/2012/02/02/the-real-economic-picture/

While there read some of the articles. Very eye opening.

Just keep on a stackin!

Perfidious Albion's picture

Self fulfilling profligacy

ar126636220725101.jpg

images.jpg

redwood's picture

Tina

I believe you have described what is termed a wide or engulfing bar.

"Outside Bar, also called a Wide Range or Engulfing Bar, is a bar with a high that is higher than the previous bar and with a low that is lower than the previous bar thereby engulfing the previous bar. Since the open and close are close together on the marked bar, neither the buyers or the sellers are in control and the market is undecided which way to go.
When the open is in the bottom quarter/third of the bar and the close is in the top quarter/third of the bar, it is said to be bullish engulfing with the buyers in control. When the open is in the top quarter/third of the bar and the close is in the bottom quarter/third, it is said to be bearish engulfing with the sellers in control."

http://www.learntotradethemarket.com/forex-trading-strategies/price-action-trading-strategy

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