I've received several requests to "do what I do". So, here you go. (Keeping in mind that you should probably do the opposite.)
First of all, these hourly charts are astonishing. Just six, short trading days ago, The Fed confirmed QE∞ at a minimum of $85B/month, all needed to fund the ongoing U.S. federal deficit. Instead of rallying, the metals have been slaughtered. Why? Hmmm...We've seen this phenomenon in crude before (http://www.zerohedge.com/news/curious-case-post-qe-oil-hangovers) & (http://www.zerohedge.com/news/2012-10-09/why-oils-post-qe-plunge-may-be-over) and apparently it's worked so well there that The Fed and Their Cartel have decided to give it a go in the metals, too.
And now, mainly, I'm just mad at myself because I didn't see this coming. Of course The Fed is going to instruct their minions to crush the PMs. The Fed had no choice but to initiate QE∞ and the last thing they needed was an immediate, perceived quid pro quo with rising metals prices. The metals had to be crushed. It's all a part of their ongoing strategy of MOPE and SPIN. Duh! (Jeez, the more I type the more stoo-stoo-stoopid I feel. Better stop here.)
All that said, there is no reason to think that it's over, that the 12-year PM rally is kaput. I'm sure that the metals will stop and reverse, just like last year. The only question is, where? Since nothing has changed and the fundos are, in fact, even stronger than last year at this time, why would we expect prices to break any lower than they did a year ago? (Keeping in mind that the last sentence was typed by a guy who didn't see this selloff coming.) Sometime soon, the metals will reverse with a sharp, short-covering rally. That rally will likely stall and the momo-shorts will be emboldened to take another stab at the downside. Then, after failing to take things markedly lower, a bottom will form and price will begin to recover. If compelled to trade paper in this environment, here are some charts that show a striking similarity to the action of a year ago.
Hang in there. Good luck.
Thank you for supporting TF Metals Report. Your voluntary subscriptions and donations help keep this site alive!