Well, THAT Was Interesting

What a day, huh? First we saw some May silver call-sellers get squeezed. Then, the FOMC statement caused a sharp selloff. Unfortunately for The Cartel, no waterfall ensued as price quickly rebounded. We now look to be on the verge of a rally. Let's get started!

I know that many folks come here only to read my blogs or to visit Pailin's Corner. In doing so, many miss out on the terrific information that is shared in the comments. Rather than re-type my thoughts from earlier, here are some C&Ps of my comments from the previous thread:

Submitted by Turd Ferguson on April 25, 2012 - 10:46am.
If anyone is willing to gamble in the casino, now would be the time. This reeks of a screwing of put sellers ahead of option expiry. The final beatdown before the reversal.

Submitted by Turd Ferguson on April 25, 2012 - 11:17am.
The summer is going to be hot and explosive, though, so anyone gambling should be sure to buy time, too.
Maybe (buy) the Oct or Dec (silver) $40s?
All I know is that today's action is bullshit. May call sellers have been forced to hedge by shorting futures. Just like the action we saw in late March prior to April gold option expiry. Recall that after dropping to 1630, price rallied sharply back toward 1700. Same shit here.
I expect silver back to 32 or even 33 relatively quickly, The Bernank notwithstanding.

Submitted by Turd Ferguson on April 25, 2012 - 11:21am.
A drop to 30 or just below is possible but I firmly believe that that is it.
Physical demand is very strong and there are literally tonnes waiting and hoping to be filled at $30.
EVERYTHING points to a bottom here. Longterm holders WILL NOT be disappointed.

Submitted by Turd Ferguson on April 25, 2012 - 11:48am.
And most should NOT (be trading).
However, this action reminds me of the day in early November 2010 when QE2 was announced. A beatdown headfake occurred that day prior to the announcement.
Again, if you are willing to risk a loss in the casino, this looks like an excellent opportunity to give it a whirl.

Obviously, I believe today's low was the bottom. Maybe there will be a retest but $30 silver is going to be a very difficult barrier for the permabears to break. I would still be looking to put on a speculative position here with money you are fully content to lose if you are wrong or if it is stolen from you. That said, if you absolutely feel compelled to trade in the casino, this would be a good time to give it a try.

Gold is basing above what appears to be solid support between 1625 and 1635. As our pal, Winston, pointed out earlier today, physical demand is so strong and consistent here that further, sustained drops in paper price are highly unlikely. Gold will show signs of life when it trades back above 1650 and then 1660. Let's go into more detail and begin to get excited then. For now, let's just be happy to be building such a strong base from which we can, eventually, catapult forward.

paper_4-25pmgold6.jpg

Clearly, I'm excited about silver here, too. $30 silver completes the right shoulder of our massive, reverse H&S formation and Winston has informed us about incredible demand for physical silver at that level. I am nearly 100% certain that silver won't fall again much below today's lows. As it bases here, it is preparing for Battle Royale II. Of course you remember Battle Royale I at $36 in late February and the ensuing crush. Well, Battle Royale II now lies near our old nemesis of $33. What will happen next time? I can't say for sure but I'm quite certain we won't have to wait too long to find out.

paper_4-25pmsilvd.jpg

Just a quick word about open interest and the next CoT. Today's OI (basis yesterday) came in at a new low of 395,389 in gold and 122,325 in silver. Recall that yesterday, price rose by about $10 so what we clearly saw was short-covering ahead of The Bernank. No doubt many of those same shorts were put back on this morning and are now, once again, waiting to be covered. While silver rose 22c yesterday, OI fell by about 400. Clearly this was a short-covering bump, too. Please allow me to emphasize this again:

Since March 15, paper silver has fallen in price by over almost $2 yet total Comex open interest has expanded by almost 15%. There is no question in my mind that this is the result of short contracts being added. Just as the EE fleeced the over-excited longs in February, they will soon fleece the over-indulgent shorts. Just be patient.

For the CoT reporting week, gold fell about $9 while shedding 3200 in OI. Silver fell $1.22 while adding about 1000 contracts. Here's why both are ultimately positive: Gold liquidity has been wrung out and now sits patiently in the sideline, waiting to return as the charts improve. The much smaller silver market has swung from speculative long excess in late Feb to speculative short excess in late April. The EE, playing both sides of the specs for profit, will soon close the trap on the foolish spec shorts.

Finally, this short video about government debt. Not much new here for the average Turdite but, since it's presented in such a brief and simple manner, perhaps you can C&P the url and email it to your friends.

That's all folks. Watch the overnight trade for signals of sovereign and big-money buying of physical post-Bernank. A positive London trade post 3:00 am would be a strong signal.  TF

p.s. Tomorrow, April 26, is Israeli Independence Day. Be cautious and on the lookout for some crazy headlines.

227 Comments

ata's picture

First ?

First time first.(silly boy)

Patrancus's picture

2nd maybe

2nd maybe

Halo's picture

Thurd & Jim

TheRajMan's picture

Thanks turd

Thanks turd

Ferd Torgerson's picture

Fifturdth

Not buying or selling right now.  Just waiting to see if my miners can make a steady recovery.

Thanks for the update, Turd.

Turd Ferguson's picture

This amazes me every time I see it

MODERATOR

Did you know this?

From Uncle Ted:

The entire world’s gold bullion inventory (bars held for investment or monetary purposes) is now worth 150 times more than all the world’s silver bullion. The numbers are pretty straight-forward; the 3 billion ounces of gold bullion in the world is worth roughly $5 trillion at current prices ($1650) versus the $31 billion value of the world’s 1 billion ounces of silver bullion (at the current $31 price).
 
Vypuero's picture

a small comment

the term is reeks - since you are speaking of how it "smells" metaphorically, or feels

the work "wreaks" means, for example, a storm that "wreaks havoc" - to bring about or cause misfortune

Hard Rain's picture

Holy Batman

I actually made a top ten. I need to buy a lottery ticket!

Rain

Turd Ferguson's picture

Thank you

MODERATOR

Noted and corrected.

Response to: a small comment
Dracula's picture

It was this posted

It was this posted before?

I don't know what to say more than this guy says.

Deeper's picture

300 day moving average

Is also at the same intersection of trendline and horizontal support/resistance.  

waxybilldupp's picture

Just waiting for the day

Waiting for the day BM and her monkeys Crash & Burn.  Can't possibly be that much longer, can it?  May, may be quite interesting.  Seems like a lot of silver contracts out there.  Will they stand for delivery?  Will May be the month?  I'm ready coach ....SEND ME IN!  

Meanwhile, perhaps a bit of Crash / Burn theme music complements of Blues Traveler  will help keep spirits high.  

Patrancus's picture

I concur we have had a real

I concur , we have had a real spending metamorphous at all levels of government since Nixon ended Bretton Woods, I seem to recall an illustration pointing out the obvious unholy alliances between between the banksters and the politicians where one hand prints it, and the other hand spends it, though government always finds a way to spend it, because it is easier to spend somebody else's money , than it is to spend your own. I found the interviews with those saps over at the NYT very entertaining though they will have to find another way other than to spend other peoples money living fat in retirement. People voted and elected the bast--ds who do nothing while in office but look for freeloaders to receive other peoples money. 

Turd Ferguson's picture

Even the KWN haters...

MODERATOR

...should be able to agree that this is fantastic and right in the money. I'm not a big fan of old "Hairy" but he hits it out of the park here:

"We know what they are going to do.  They are going to ease.  The economy is not that strong, the Fed is wrong.  What a shock, they’re wrong.  Do you remember when Ben (Bernanke) thought the subprime crisis was contained?  

They don’t know anything.  They’re idiots.  They are the cause of the problem.  So why do we want to know what the idiots think about about the current state of the economy?  Why do we care that they currently think they are so smart and that everything is okay?  You know what I was doing while all of this was going on?  I was out playing tennis." 

(And Turd was at Sam's Club.)

http://kingworldnews.com/kingworldnews/KWN_DailyWeb/Entries/2012/4/25_Fleckenstein_-_Fed_Idiots_Wrong,_Big_Problems_in_Europe_%26_US.html

GoldMania3000's picture

When the Fed was on

I was watching a great porn movie

Dr G's picture

Turd, thanks for your

Turd, thanks for your thoughts. In reference to "I can't say for sure but I'm quite certain we won't have to wait too long to find out", would you say that this means silver will NOT trade sideways for the next 6-8 weeks? That silver will engage that trend line prior to that rather than waiting for it to resolve based simply on time?

And a huge LOL at Fleckenstein. Out playing tennis. Love it. Wish I could say I was having a nooner with the misses, but alas I wasn't.

brad_pitts_betterlooking_brother's picture

no surprise there

goldmania3000 works at the SEC,  you see  ;)

Big Buffalo's picture

Thank you Turd

Just wanted to give you a quick thank you. You've been a great guide to many and for me.

Let's hope for a big few days to come.

cpnscarlet's picture

Not Fun At All

I must say that this day vis a vis investing/speculating was totally NOT fun at all. Add to that some of the rancor around here the last few weeks. Although I have tried to tune it all out since the beginning of April, it has not worked. ANY TIME I have come here or have read at ZH, there is nothing but bad news or more "PM positive" items that lead absolutely nowhere.

How's that for "sentiment"?

PS - Job interview next week for an "electronics tech" position. Only a 71% pay cut, but it might actually be enjoyable. Wish me luck...I really need some right now.

rtabit's picture

Turds Comments

When I'm busy and want to quickly see what Turd has been saying I go to Comments section and search on "Turd F", in case anyone didn't know of that feature.

Santa's Elf's picture

Amen, Turd (re: KWN haters)

Have to agree wholeheartedly with Fleckenstein here.  I'm simply baffled that anyone gives even an ounce of credence to anything Bernanke says.  One moment he states the economy is flourishing and we are in no danger of a recession, the next moment we're in a full blown recession.  He's a liar, plain and simple.  And frankly, I'm not sure what choice he has.  If he told the truth, the masses would be rioting in the streets and looting grocery stores today.

Btw, I celebrated the FOMC hullabaloo today by adding this to the stack:

Santa's Elf's picture

@ cpn - I think a good bra resizing is in order

Sounds like you need a good bra resizing, because your TITS indicator is weighing heavy these days.  How about walking away and adding some more Lionel pics.  I'm a big fan of what I've seen so far of your train station, etc.  Just like escaping to a whole new world.

I Run Bartertown's picture

We don't need no stinking bottom!

Can't even get down to below 30 or 1600?

Seriously, if the EE guys can't do better,

I'm gonna think they're a bunch of limp-dicks.

Driven81's picture

@ Hard Rain

Just bought a mega millions today, 5 play. Hey, everything has chance to it. If I win, I am moving to Argentina....STILL floored at the amount of winnings mega millions got the other day.....640 MILLION!!!!!!!! Thats over half a BILLION dollars lmao. Nuts nuts nuts. People want that cash!!!!

Turd, great video and quote about total gold holdings value vs total silver holdings value...amazing!

Wow that is nice set of TITS there, very bullish, with fundamentals

Silver Meddler's picture

Fifteen Ounces

I took 15 more ounces of silver off the market today at ye local shoppe.

Xty's picture

TF, I'll never be first, but I found a place we can all meet

                         

bernard's picture

College is a Racket

Given the facts I am about to lay out to you folks here, I would seriously consider thinking twice about sending your kid to college, unless he is 100% going to get a Computer Science , Engineering, or Chemistry degree.
 
A good friend of mine’s son recently dropped out of college, and has become very interested in stacking. I had the opportunity to sit down with him a few days ago. This is the gist of what he told me:
 
1) 90% of young people in college care more about partying and getting laid than getting an education
 
2) 75% of people in class check their Facebook at least one time during class
 
3) Cheating is more prolific than ever
 
4) The newest and latest craze is ecstasy , or MDMA. Electronic music is the most popular genre at most colleges, and this drug goes hand in hand with the electronic musical festivals like Coachella, Together as One, and “HARD”. This is significant because this drug has clearly been shown to BURN HOLES in the brain... making these kids DUMBER than EVER.
 
5) Most tests are MULTIPLE CHOICE
 
6) Most kids WILL NOT BE FAILED, no matter how poor their performance
 
7) Most UNIVERSITIES care more about their SPORTS teams than their STUDENTS
 
 Social Posturing and Being Cool are MORE IMPORTANT THAN EVER
 
9) Very LITTLE time is ACTUALLY spent on school work and learning
 
10) MANY MANY classes are taught by Teacher Assistants (TAs)
 
11) Many students are now using their student loans (now CONVENIENTLY placed on DEBIT cards) to purchase non-education related items such as alcohol, drugs, and ipads.
 
12) Many college kids still have NO FUCKING CLUE about the greater impending IMPLOSION of the global economy
 
13) Those that do are very well praying that by the time they graduate, it recovers.
 
14) Over 50% of the kids that graduated in 2011 DO NOT HAVE JOBS (see: http://www.sun-sentinel.com/news/nationworld/sns-bc-us–overqualifiedcollegegrads,0,3839550.story) and many that do are working in NON-DEGREE requiring fields, such as: WAITRESSING
 
15) Obama is trying to BUY the youth vote back by luring in his young base (WHICH HAS ALL BUT LEFT HIM, HOWS THAT HOPE AND CHANGE FOR YOU) see: http://www.cnn.com/2012/04/24/politics/obama-youth-vote/index.html
 
16) Many people openly acknowledge that the high price of PRIVATE EDUCATION is more for the “CONNECTIONS” than the “EDUCATION” aka being able to rub shoulders with the sons & daughters of the NWO and high ranking politicians.
 
17) Extreme Alcohol Poisoning or “blacking out” is often described as an exuberant occasion, with many students bragging about how blacked out they got last night
 
18) College kids NO LONGER live the “starving, living in a HOVEL with their books, aching with the pains of studying” lifestyle, and often go out for every meal, sucking down Mommy’s checking account and their Stafford Grants
 
19) Many still see “stock analyst” as a favorable and venerable position
 
20) The Diploma Mills are becoming Resumé mills, where BACHELORS graduates can 1-CLICK-SUBMIT their resumé to 100,000 companies… effectively diluting the power of their labor even more.
 
AS ROSS PEROT SAID in 1992, unfortunately…
 
OUR WAGES MUST COME DOWN, and THEIR WAGES MUST COME UP
 
What this means for the average America? THEY ARE DONE FOR. Simply put, the big guys behind the curtain screwed the Goose…. in an era where THE MEME is “BACHELORS IS NOW A PRE-REQ” I encourage you all to step back and realize that this is SO VERY FAR FROM THE TRUTH. I fully stand behind the assertion that 90% of kids going to college now would be better of TAKING that money, BUYING UP AS MUCH SILVER AS THEY CAN GET THEIR HANDS ON, and then reading up on google.com “How to build a website” …
 
All you need is PHP, MySQL, and a little bit of HTML to make just about anything on the web. And when everyone is broke, jobless, and has only their ipad to delude them away from their miserable and empty life (without meaningful work how can life be fulfilling?), perhaps they can browse YOUR website, and click on YOUR ads.
 
College is a racket, clear and simple. In this modern day, any enterprising individual can teach themselves just about ANYTHING through trial and error, and the internet. Take a little initiative, grab your balls, tell that school administrator to take her LIBERAL AGENDA and SHOVE IT. Stop buying those $200 books co-signed by that Krugman lunatic and get a move on with your life.
 
-Your friend, Bernank Shmuelle
¤'s picture

TeaDrinker

Welcome aboard!

ouchtouch's picture

OK I'm in

Bought some Ag at 30.88.  My last nibble was at 31.37.  Feels good to get that cash out of my hands.

¤'s picture

cpn

Good luck! yes

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