Can't Think of a Witty Title Today

It's Tuesday and, with the euro sliding again, down go the metals for the 96th day in a row. OK...maybe it just seems like 96 days but...it's actually 12 days out of 13 now that silver has been down. Yuck.

Anyway, I'm kind of rooting for a down day today. Last week's CoT was so astounding that I'd love to see if this week's can get even better. A continued selloff today should give us a true picture come Friday.

Look, I know this is brutal and no fun and it's easy to believe that the metals will never, ever have another UPtick. Well...that's probably not the case. Since this time last week, we've been looking (hoping) for some kind of bottom between 1525 and 1575 in gold and 26 to 28 in silver. Could those levels fail and send both metals crashing lower? Of course, and we've also discussed the possibility of 1450 and 22.

http://www.tfmetalsreport.com/blog/3771/latest-gold-and-silver-breakdown

http://www.tfmetalsreport.com/blog/3773/turd-backwardation

However, even though we are clearly in unprecedented times, I believe that there is still value in some of the tried-and-true indicators. One of these is the Relative Strength Index. For a refresher, read this:

http://www.tfmetalsreport.com/blog/3246/other-technical-indicators

Remember, an RSI reading of 50 is the median. 60 is somewhat overbought and 40 is somewhat oversold. 70 is well overbought and 30 is well oversold. Now, look at these charts.

Of course, RSI is not some kind of stand-alone, perfect indicator but you have to wonder how much lower it can go before price bounces and stabilizes. 25? 20? 0?

As you can see on the chart below, much of the problem in the metals is Pig-related. Not many folks were discussing the critical juncture at which Pigatha found herself three weeks ago, but we were. From 4/26:

And now look what has happened in the time since:

On a longer-term chart, you can clearly see where The POSX has consistently had trouble with the area around 82. Perhaps that number will serve to slow/stop the rally again this time. We'll see but a final push toward 82 might coincide with a final drop in the PMs to 1525 and 26. Let's watch to see what happens.

(Note, too, that the "Operation Twist" dollar strength has been at the heart of the PM decline since August of last year. Not much reason to get overly excited about a continuance of the PM bull markets until the trend is finally broken.)

I have several reading assignments for you to pass the time today. First, this very interesting piece from KWN. Even the KWN-haters will like this post. Very interesting.

http://kingworldnews.com/kingworldnews/KWN_DailyWeb/Entries/2012/5/15_Who_Is_Crashing_The_System.html

I just found this latest piece from Jeff Nielson. He wrote it two weeks ago but it's still worth a look.

http://www.bullionbullscanada.com/gold-commentary/25480-the-big-lies-regarding-precious-metals-miners

Say what you want about Debka but they've certainly been more accurate lately than I have.

http://www.debka.com/article/22003/

I don't recall where I found this but I made the mistake of reading it last night before I went to bed. I then proceeded to toss and turn all night and no amount of coffee seems to be able to rescue me today. Share my pain. Read this now and consider the consequences.

http://EndtheLie.com/2012/05/12/the-nuclear-industry-and-fukushima-a-giant-nail-in-the-coffin-of-humanity/#axzz1uwY0x0E2

Lastly, I'm recording another podcast this week with Mike Krieger. Mike recently started his own site and it's terrific. It can be found at: http://libertyblitzkrieg.com/. Below is the full text of one of his latest posts. I'm including the entire thing here because I want to ensure that you read it.

Six Months Left…Can They Do It?
I have to hand it to the Central Planners.  They are good.  Really, really good.  Of course, they are battling a crippled opponent considering so much of America consists of lobotomized sheeple, but nevertheless to be able to steal so much from many people with such blatant and simplistic methods and not be widely discovered is an act of devious brilliance.  The reason I say this now is because ever since last fall TPTB have changed tactics and totally taken over the markets and with it shoved many people into what is best described as a trance.  The people know something is very wrong.  They know they are getting poorer; that life is getting harder, yet the television and the markets have cloaked a blanket of sedation upon their minds.
Ever since roughly early October 2011 the markets have been fed line after line of carefully crafted bureaucratic garbage couple with tactical market interventions to create reality that they wish to sell.  I remember back to those last months of 2011; what it was like.  It was pure madness.  There would be a crisis and then TPTB would come out with some meeting in the next week or two that would solve everything.  Then the date would come and go and nothing would be solved and they would move the meeting to the following week.  Meeting after meeting that would be “decisive” and “bold” and would save us poor ignorant peasants from the ravages of the mean world by thrusting us into the parental arms of those who know best.  Big government and big financial institutions.  They are your new overlords, get used to it.  Subliminally that has been and continues to be the message that these guys are trying to hammer into your head.  It’s the Stockholm Syndrome.  You are being programmed to love your abuser.
In any event, the point is this. Since around fall of last year, if we tally up the score of government  vs. markets as Angela Merkel so candidly noted in 2010, the government has had seven months of pretty much victory after victory.  At least this is how it appears on the surface.  Under the surface believe me they are not so smug and they know they are losing.  You could see the fear and doubt in The Bernank at his latest press conference.  You can see the reality of the situation as it pops up through to the surface every now and again despite the media blackout of any “unfavorable” news.  These bureaucrats know full well this is all a hologram, an illusion, but it is one they are trying to sustain for as long as possible.  A line my friend said yesterday really sums it up.  So the news headline came out that “Fed Exit Should Start in 6 to 9 Months: Kocherlakota (current President of the Federal Reserve Bank of Minneapolis). ”  My friend’s response was: “is that the Apache to Paraguay midnight print.“

Well the past is the past and the future lies right ahead, so how should we be thinking about things?  The assumption that is being made, and to some extent has to be made, is that if they have been able to pull off this total coup of the financial markets for the past seven months why can’t they keep it going until the election.  Well if we are to assume this, it means we must assume they can pull it off for six more months, which would bring the total to thirteen months.  This would be quite a feat.  They know how difficult it will be to keep things “together” in the markets amid a real world that is falling apart.  This is why the Fed is pretending there will be no more liquidity added to the system.  In their minds, the best strategy is to talk down QE while at the same time attacking commodity markets behind the scenes.  In their mind, this will give them the cover to create trillions more for their banker shareholders.  I have stated that this would be the plan and as we can see in the markets lately, it has been executed to precision.
There is a problem to this strategy; however, and that problem is reality.  The reality is that pretty much all of the engines of global growth in the emerging markets have economies that were similarly fueled by ponzi finance and money creation and they are rolling over hard.  I don’t even need to mention Europe.  Then there is the United States of Propaganda, which has held up relatively well due to the reserve currency status.  That said, relatively wellI does not equal good and recent indicators are pointing to a serious loss in momentum here as every unemployed EBT carrying subprime borrower in these 50 states has just purchased a car they can’t afford with free money from Ally Financial (74% owned by the U.S. government and the former GMAC, or General Motors’ financing arm).
So the fact that pretty much every major economy is rolling over at the moment means one thing.  These guys need to print and print big.  Not that this does anything for the economy, but it usually buys time (until it doesn’t).  If they are going to print and print big they need commodities as low as possible.  This is the reason for the now blatant government/Central Bank sanctioned and coordinated raids on precious metals.  Folks like me that have been aware of what has been happening for years are on the sidelines.  We are already protected from the inevitable and so it makes sense to only buy the raids.  While I have bought physical metals many times in the last couple of years, I have done no major buys since 2009.  That may be about to change.  I still suspect one more major raid attempt may be made.  If so, and silver is knocked down a few dollars from here in a paper smash, I will be standing there ready to go with the biggest buy in years.  I am not the only one.  All of us are thinking the same way.  The pent up demand from folks like me is big.  We are in no rush as we are waiting for the Central Planners to blink and then we will pounce.  When a price is printed that catalyzes huge buying it will set a major floor and we will be headed straight to $2,500 very fast.  It’s possible this has already happened, but I have a suspicion they have another trick up their sleeves.  There are four more FOMC meetings ahead of the elections (June, July, September and October).  I suspect they need to act in June or July.  The huge risk now though is if they do push the metals in a gap lower from here supply will literally disappear.  Let’s see if they dare.

OK, that's all for now. Have a great day and hang in there.  TF
 

467 Comments

pedli's picture

1st

scary to buy

Big L's picture

First?!

Can't be?

Edit, Hey, can we call it a tie?

2nd Edit, It'll take a bit to work through the articles, but I'll read them all, like usual.

I've come to the conclusion that it's all about the Gold, and Silver goes along for the ride.

I now view all politics and financial news through the "what does this mean for gold" lens. It's the follow the money thought process, only now it's all about the gold. I don't think anything else makes much sense now.

Eric King's picture

second

will be buying in 27s

Mudsharkbytes's picture

Definitely 4th?

At least in the top 10.

Duke's picture

First, I can't believe how

First, I can't believe how lucky I am - Man, I'm special!

tonyw's picture

just joined and sixth? already

time to sign up and get back here:-)

Big L's picture

Interesting fukushima .....

I sat next to a nuclear waste expert at lunch on Saturday. My ex-brother in law to be exact.

He verified the info we've seen posted here and on Zero Hedge. He told me they're trying to build a huge robot with arms long enough to reach into the pools and remove the fuel rods. Of course they have to clear the trash out of the pools first. And they don't have a solution for that yet. Great.

He also verified that they haven't committed to dry cask storage, because of the cost involved.

meddle magic's picture

Turd

are we putting too much stock in the COT? Are the #'s accurate? Nobody can dispute them who's to say they are accurate. I am begining to doubt all the data concerning the metals reporting.

Big Buffalo's picture

This is my timeline..

"There are four more FOMC meetings ahead of the elections (June, July, September and October).  I suspect they need to act in June or July."

I'll buy a little gold and silver before each of these meetings. Especially eyeing up the September range, due to the debt ceiling. Simple.

Only problem is which gold coins to grab next!?

Hrunner's picture

I seem to HatTip everyone

I can't seem to help myself, but I seem to hattip almost everyone (not Pokersensei), does that violate some Turdville code or regulation?

ggnewmex's picture

If silver gets to zero

Then i WIll  BE buying everything I can get my hands on.!!! LOL

Seriously, I look at these prices as a gift, and hope they stay down for a while longer so that I can get my hands on more.

Ok, maybe I drink the Kool-aid, I know, But my rational mind can not get over the fact that the USD is right now the "safe" asset, and commodities are risky. Really?? ,  really..... Does any commentator stop to think that the debt has gone exponential? 16 Trillion and climbing faster, and that is safe? really...

Also, cannot stop thinking that China is still a Quasi-Communist country, and necessarily, are they are best friend? There is greater than 1500 years of pride that would, IMO simply love to be the biggest/ controlling factor in the world, and tell the USA what to do. Which, lends credence to the whole SWIFT II issue..

just my thoughts

GG

Xeno's picture

Apexeses

Is it just me or does it look like that the apexeses on many of the charts all look to be coming in around the same time?

Six months? Not by those apexeses.

Dr G's picture

Just ridiculous that Twist

Just ridiculous that Twist has given any strength to the dollar. What a farce.

Hair Fleckenstein actually made some decent points the other day in his interview. He noted how ironic it is that the Eurozone is struggling right now and the US is perceived as fine. This has occurred because the Eurozone is trying NOT to print, whereas the US just prints like it's going out of style. Printing alleviates the pain in the short term, which makes the common man happy.

In other words, the Euro is ripping the band-aid off to a degree, while the US continues to apply more band-aids. Our day will come, and that is why we stack and prep.

Dr G's picture

Silver isn't going to zero or

Silver isn't going to zero or anywhere near there.

Dr G's picture

@meddle magic, good job

@meddle magic, good job developing that critical eye. You can gather up all the sources that are bullish metals and still question their data and their opinions. That's not bearish or trollish, it's simply smart.

@Big Buffalo, it seems that Sept or October might be a little late to implement QE, doesn't it? Maybe not. I dunno. 

Lanikai's picture

Feed the turd, this isn't public radio

Finally fed the turd after too long.  My wife has been reading you since zerohedge days.  I would look over her shoulder or ask her 'what's happening...'  She warned me weeks prior something was wrong at MFglobal, said I should get our money out... and got to kindly say 'told you so' when it was too late.  That's when I started to expand my reading and more recently posting.  In 2005 on 321gold blog(?) about Turkish bourse got her attention and I followed her intuition and behest to be proactive.  Turd, your a lucky man, you have no idea how many people love what you have created, or women secretly in love with your mysterious persona.  Or is it the big yellow hat?

silverstax's picture

Silver is going to double zero...

As in the $ X00s cheeky

Turd Ferguson's picture

Just spoke to Jim Comiskey

MODERATOR

He called me to tell me about a rumor he's hearing from the floor.

Story is that JPM, either directly or through a client, has a major margin call in silver and they have been selling in size all day. Not sure what to make of this right now but, if true, we will likely see silver under pressure for a while longer. Maybe accelerate to the downside. His ultimate target seems to be $26, too, as this would be a 50% retracement of entire bull market from $4 low to $49 high.

Jim will have more information on his YouTube channel update later today.

http://www.youtube.com/user/jimcomiskeymetals

Loud Noises's picture

Thanks

Thanks Turd, for the reading lists that you like to supply.  When I see links in a blog post, they're always worth my time and I always read them even if I don't post afterward.  I'd bet that many more here are the same way.

As far as dips go, I'm trying to build up enough dry powder to be able to make what qualifies as a major purchase if we go down there.  I'm simultaneously expanding my fiat emergency funds to help guarantee that I will not be forced to ever sell into weakness, should this charade continue to extend itself and my work be interrupted in any way.

Trying to save in both metals and FRN's at the same time feels a bit like cleaning your floor and then taking a dump on it but oh well. 

Big Buffalo's picture

@ Dr G

I dunno either.

Suppose we do get QE3 in July, gold goes up. Then suppose in September the debt ceiling is hit, debt ceiling becomes huge in the news and debates. Gold goes up. We are in a no lose situation buying prior to these events.

(These are just my gut feelings.)

On the other hand, is there really a need for QE3 to be announced any time soon? The dollar is getting a nice boost, Euro is falling dramatically and yet the DOW is well above 12,000 (12, 700 as I type). Why would Ben announce QE3 unless the DOW is below 10,000? The only reason we would print money is to decrease the value of the dollar to be more competitive with exports.

This is confusing. Screw it, I'll just stick to my disciplines, buy an oz of gold on every $50 drop, and then buy on every dip after $50 increases. Sprinkle a little silver here and there. 

Aquaponics: cycling of water is complete, adding channel catfish, trout, and bluegill in 2 weeks. Then adding crappie and perch in October. The garden is doing well. The wife and I have been eating out of the garden for several weeks.  Really looking forward to make peach cobbler from our peach tree this fall. Mealworms started to pupate, so we'll have a ready supply for the fish. The redworms are thriving and composing our kitchen waste, being feed to the turtles and fish.

Mosin Nagant: Shot about 100 plus rounds the other week. Fun, fun, fun. Will be taking it out in a couple weeks. Also the Sig 9mm. Will probably pick up a Ruger 22lr handgun and rifle in a month or two.

SRSrocco's picture

SOME INTERESTING REPLIES

HERE ARE SOME EMAIL REPLIES FROM MY LAST ARTICLE

I had some interesting replies from my last article CRITICAL FACTORS THAT WILL IMPACT SILVER.  I thought I post a few here so you can see who is investing in SILVER.

Thankyou for the link information I found off the perth Mint in Western Australia.
 
I am gradually disbelieving the crap on the Tv and payed sites for precious metal information. I am trying to make informative and calculated objective decisions based on fact (distorted in the media) as to what is fact and fiction and provide a financial future for my family.

Big questions; a mate of mine told me all about this and its hard to imagine. But during and after wars precious metals have always been valued. The asian community seem more familiar with this; as when I was in the Perth Mint Buying some silver I was only one of two Anglo saxon men in line the que was made up of 18 asians all buying silver and gold.

Thanks again

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

 

Keep up the excellent work you're doing. You're articles are first class. It is your type of analysis that caused me to invest in 'physical' and exit the stock market a couple of years ago.

Unfortunately I know of few people who are doing this. As a chartered accountant and corporate banker (won't name the bank) I consider myself financially savvy and can only presume that it's people's unquestioning faith in the status quo that keeps their 'wealth' in the phoney paper system.

One day, perhaps after another major shock to the worlds financial system we will see investors turn en mass to the safe haven of precious metals. in the meantime I will continue to keep myself informed through contributors like yourself.

Regards

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

 

     What I found interesting in the first reply was that the respondent found the article on the Perth Mint website.  Furthermore, it gives proof that its the ASIANS that are still buying and not WHITEY to a large degree.

In the second reply we find that some BANKERS do indeed know what is going on in the GREAT PAPER PONZI SCHEME.

silverstax's picture

Nice Turd!

I knew when the JPM announcement was made last week that somehow silver would play into it!

Their ship is going down - the only question is will be a matter of days, weeks or months.

California Lawyer's picture

California Update

Mates:

California is the world's 8th largest economy.  Maybe it was 6th, but for argument's sake, let's just say it is in 8th place.

I feel like I am as good as a commentator on the state of the local economy (So. Cal.) as any of the media pundits because: (1) I live here now; (2) I have lived here my whole life (47 years, except for 5 years when I was serving in the US Army away from California); (3) I represent regular folks with regard to their legal troubles; (4) I have a large network of friends and business associates spread all around So Cal; (5) I do the grocery shopping; and (6) I am a typical middle-class raised American, grew up eating raisin bran and corn flakes, chef boyardi raviolis from a can, and drinking Coke, not Pepsi.

So, let me weigh in on how I see the local economy and just some anecdotal viewpoints.

The state's budget mess is a rare constant in a sea of change.  The budget is ALWAYS a mess.  The lawmakers routinely enact gimmicks and tricks to assemble a patchwork of temporary fixes to hobble off into the future.  When the next crew of politicians comes in, they all promise something different, but it always is the same.

The families that seem to be doing okay are those living off government salaries.  City Manager makes $300,000 plus perks.  Police detective makes $150,000.  Fireman makes $150,000.  No joke.

I can say that public unions have it made, for now, as long as the gravy train is working.  Taxes must be raised, because there is no chance at all that public workers will either be laid off or have their salaries or benefits reduced.  THAT IS THE PROBLEM WITH THE BUDGET MESS.  Too many promises by those wanting to be elected, not enough taxpayer workers to pay the bills.

California is also ground zero for the housing mess.  How can the economy pick up when a massive percentage of home debtors are underwater?  When is shadow inventory going to clear?  If it cleared, home prices would tank, further eroding value, and leading to even more underwater homedebtors, ad nauseum.  See?

​California = Greece, or better still, People's Republik of Kalifornia = Greece.
 

California CANNOT be allowed to fail, or else it will be the domino that tips over and crashes the system.

Watch what happens this summer on the budget mess here in California.  Remember, all 55 electoral college votes go the popular vote winner.   So, don't expect any federal help, since Obummer does not need to dish out any goodies to the locals to grab all 55 votes.  Romney won't set foot here, but if he does, it will be behind the Orange Curtain to woo rich Republican's in Irvine.

California could conceivably become a super majority of democrats in both legislative houses.  What that means with Jerry Brown as governor, is that anything that the democrats want, they can enact.  What will they ask for?  A Greece-style bailout, based on promises of austerity.  Yaaayyy!! I can hardly wait.

What does this mean for precious metals?  Simple: more MOPE to keep the fiat system alive.

Bix Weir = sorry, pal, Ron Paul is not going to win.

Wall Street Insider = sorry, pal, Obummer is still getting huge money backing him to win.  Only question is his running mate (think Hillary?).

Since all hands on deck are being summoned to help reelect Obummer, then all efforts will be made to prop the economy, ease unemployment lower, shove soundbites at the masses, and get Obummer back into the oval office.  At that point, who knows what will happen?

So, anyone wanting to predict future movements in physical precious metals prices, just watch the stories coming out of Kali.  Hint: How can the dollar crash and California survive?  How can precious metals escape the downturn yet allow for improving economic numbers?  Why, there it is: QE3 . . . 

Just saying . . .

ACM's picture

Dr. G

"Hair Fleckenstein."  ROTFLMAO!

RTMoney's picture

Backwardation

If I understand backwardation correctly, one could sell his "stack" on the spot market and simultaneously buy it back for future delivery making a little extra in the process... (lets pretend that counter party risk isn't a factor)  The 1 month lease rate is still negative, meaning one could also get paid for "borrowing" the silver to make such a trade.  So if I have this right, one could "borrow" silver, sell it on the spot market and buy a future and get paid a handsome risk free return.  I'm not convinced that this slow bleed will stop until that lease rate comes back in touch with reality.  It does appear to be a coincident indicator, that being said it has come up a little in the last three days and could lend more support the the idea that this is getting closer to a resolution.

Katie Rose's picture

I just paid $18.00 for...

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Here's a link to his latest interview:

Lindsey Williams, Global Currency Is Coming, No One Can Escape The Financial Fallout

May 7 2012

http://lindseywilliams101.blogspot.com/2012/05/lindsey-williams-global-currency-is.html

Xty's picture

Hat-tips and it is all about the gold

I too am a compulsive hat-tipper.  If there is effort or logic or humour - I figure rewarding the positive weeds out the negative.  And Pokersensei was a caricature of himself.

Big L - that is what I have discovered too.  It is all about the money, and the money is gold - and silver is how you make change in gold.  Should have known it all along, but the rat-bastards run a closed shop.  That they are now blatant is surely a sign of the end - people are jumping ship and the cracks are showing.

balz's picture

SRSrocco

SRSrocco : You should have a blog. This would be my number 1 destination (tie with here).

Battle Beagle's picture

Massive Silver Accumulation/Distribution Divergence

All credit goes to SRSrocco for bringing this to my attention. 

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