Can I Bum a Match?

I know you all probably think I'm crazy, particularly after the action this week...but I'm here to tell ya, just below the surface, something is definitely brewing in the silver pit.

Let's start with gold where the changes were utterly predictable. For the reporting week, price fell about $40 while total OI rose by 2,156. As you'd expect, the Large Specs reduced their net long position by 5,900 and the small specs reduced their's by 6,800. Add them together and The Cartel was able to reduce their net short position by 12,700. The Cartel net short ratio is now a solid NEUTRAL at 2.47:1. (Anything near 2:1 is bullish. Anything near 3:1 has proven to be bearish.)

Silver is simply remarkable. Not so much this week by itself but in the total picture since the final QE∞ cap job in early October with price above $35. For the week, the only notable change was the Large Spec gross long position. These cats had hung in there for 10 weeks before finally succumbing (a little) this week. Large Spec gross long fell by 3,659 while their gross short also fell by 148 for a net reduction of 3,500. The small specs were actually 900 net positive for the week as they added 21 longs and covered 906.

And here's where it continues to get more and more interesting each week. Because the everyone-but-JPM commercials added 832 longs this week, JPM et al was only able to cover 1,752 shorts. This does reduce the total net short position by 2,600 but this is nowhere near what JPM would like. In fact, when we go back to the CoT of 10/2/12, the numbers for JPM are downright hair-raising.

For gold, the changes from 10/2/12 are exactly as expected. With price pushing $1800, The Gold Cartel was long 136,250 and short 405,520. By this past Tuesday, with price down well over $100, the Cartel was still long 137,780 but had reduced their short position by over 15% to 339,914. This entire drop in Cartel short interest, total open interest and price was entirely caused by speculators, both large and small, liquidating and closing contracts.

But check out silver! On 10/2/12, with price above $35, the total open interest was 139,117. As of Tuesday, it was 141,423. Hmmm. Now look at the details:

For the specs, the gross short positions are nearly unchanged. The gross long positions are nearly unchanged, too, with the Small Spec gross long only falling from 30,066 to 29,658 and the Large Spec gross long falling from 47,236 to 44,889 (and all of that drop came this week). So, it can be said that the reason JPM and their partners in crime haven't been able to cover in silver like they have in gold is because the specs haven't yet been chased out. Yes, you could say that, but you'd be wrong.

Check this out: On 10/2/12, the every-commercial-but-JPM crowd was long a gross total of 35,788 contracts. As of Tuesday, with price down over $4 in 11 weeks, the gross long position had risen to 40,347. That's an increase of 12.74%. So, the primary reason that JPM hasn't been able to cover shorts is that all of the other commercials are buying and, as we know, JPM is the seller/capper/manipulator of last resort! In fact, since 10/2, the total Cartel gross short position in silver has actually RISEN by over 2000 contracts from 93,628 to 95,686.

THIS IS UNPRECEDENTED!! NEVER BEFORE HAVE I SEEN THIS AND, FRANKLY, I DON'T KNOW FOR SURE WHAT TO MAKE OF IT. Ask yourself these questions this weekend:

  • Have we finally begun "The Civil War" in silver?
  • Is JPM increasingly and permanently isolated as the primary naked short?
  • Why now? We've never seen this before so why is it happening now?
  • What would happen to price if a "spark" set off a blaze that forced JPM to cover into a rising price?

Look, I know this is hard to believe, especially considering this week's deliberate and desperate manipulative takedowns. However, the silver market internals are increasingly bullish to the point where a huge 2013 is not only likely, it's a virtual certainty. At this point, all we need is a spark to set off an unquenchable fire of JPM short-covering where the silver market, for all intents and purposes, goes "offerless". The only question is: Will we get that spark? If we do, the outcome will truly be historic and explosive.

Have a great weekend.

TF

548 Comments

Prize Fighter's picture

that's right

that's right

ltcolkilgore's picture

Top 5?

??

Need to speak to my ISP about their definition of "lightning fast"....

I don't think we're on the same page...

SSSTTTAAACCCKKK !!!!!!!!!

The Green Manalishi's picture

I like Bum Matches

The Green Manalishi's picture

dupe

duplicate

Mudsharkbytes's picture

No fair

That double post counts as one - I'm takin' slot four!

Follow up to the Rare Exports video. This one has Spanish subtitles that can't be disabled, sorry. 

FWIW, they made a full length motion picture based upon the two Rare Exports shorts. 

Now back to the quicksand laden silver. Must-not-let-it-close-above-$30!!!

Galearis's picture

test

Is somebody deleting my posts?

G.

Cononish1314's picture

Red means buy son

numbers add up to nothing

Plebeian's picture

Anybody else noticing all the

Anybody else noticing all the crispy straight off the brick 2006 $100 frns floating around?  

http://finance.yahoo.com/blogs/breakout/cash-king-printing-100-bills-soa...

From the article: "What's interesting, or inexplicable, to many money watchers is that this huge increase in the printing of old-style $100 bills happened right before the expected launch of the new and improved $100 bills".  Or might these be repatriated? 

The comments (from a yahoo finance article no less!) made me laugh and happy. People are starting to wake up!  

btw turd... thanks and don't let them bring you down!

Nana's picture

Metals Will Spike Like A Rocket

When the time is right.......

Stock_Canines's picture

@Cononish1314

But when the first shot hit the docks I saw it comin'

As I was reading through the comments I had Rust Never Sleeps playing and when I read your post about second later I heard Neil sing the very lyric you wrote . . . odd

Galearis's picture

JPM

The COT numbers might also suggest that if JPM is being isolated (turned upon) by the other commercials, then this is an end game event. But since the price is down,...the official sector is still going to be happy....Is JPM worried about being a little trapped in its shorts if the bank knows that the FED is prepared to write a check for them? I always maintained that if the price couldn't be rigged anymore with derivatives, the COMEX silver market would be closed...

FWIW,

L.

Kcap's picture

What? What was that you say??

(Brought over from the last  thread)

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

Sinclair said...TA was USELESS to trade gold and silver??  Huh?  What?

Now, gee, I am sure someone has said that here from the beginning...I wonder who it was....

If only y'all listened to Kcap from the get-go....you wouldn't be COMPLETELY misguided when it comes to TA and Turd's advice.  Now that Santa as Turd calls him has come out and said this, I hope that Turd has at least enough respect for him, himself and maybe even me, to come out and admit that he was 100% wrong on this....and not to admit it to boost my ego, I could give two shits about that as I work daily not to have one at all....the point is, I have been saying all along, Turd's "flavor" of TA is not "above" the Cartel's manipulation.  If Turd ever actually agrees to this and capitulates his long held belief, we might actually begin our movement up.   Until then, they use this site as a barometer to fleece, as I have said all along.  Social sites are used to "measure" emotion about a certain thing....TFMR is used to measure emotional values on the metals.  Duh.  Come on Turd, you have actually hurt your own cause here.  Now....since I have the utmost respect for your fundamental position on the metals, perhaps you will now only stick to that as you CANNOT keep justifying that TA works.  Listen...it took me a long time to get over my traditional Japanese Candlesticking knowledge being superior in trading in all markets...I had to capitulate that notion when I realized something was astray....it started with decimal based trading, followed by HFT's to today's completely overt interference in the markets by gov't proxies.

Hey....what a perfect day to begin a new realization and abandon old ways...Dec. 21, 2012....the day under which a new era/paradigm may have begun according to the Mayans...don't you think its time, Turd? (with all due respect?)

http://www.silverdoctors.com/jim-sinclair-charts-ta-are-totally-useless-in-manipulated-manufactured-gold-silver-markets/

Kcap

tpbeta's picture

Turd old chap...

...you're either a genius or an out and out lunatic.  I guess we'll find out soon.

I Run Bartertown's picture

Plebeian

He says that drug dealers and arms dealers still have a lot of faith in the dollar...

That's a huge pool of money I hadn't thought of in terms of it shifting into other assets...

They might be the last to turn against the $ though, and have every reason to support the government that has made them so rich.

Kcap's picture

But, the FUNDAMENTAL ANALYSIS above....

...is actually Turd's strong area, not TA. 

Awesome post....you are right on!  Your CoT analysis is some of the best out there.

Kcap

Revelation's picture

Thank You Turd...

For your expert analysis and everything that you do that you clearly don't have to do to with your valuable time.

I wish you a very happy holidays to you and yours.

And a Happy 2013 to All.

Never stop fighting...

Cononish1314's picture

@ K9s

It's the Universe's mystical way of telling you to keep your powder dry or go nutty about the 2nd Amendment or something.

Green Lantern's picture

@Kcap

Go back to Sinclair's blog and do a search for Turd.  You'll find that Sinclair is an admirer and reader of Turd's TA and has publicly acknowledged him for it as well as Dan Norcini for their TA skills not that long ago.   So if you are going to use somebody elses words to defend your own bias, than you have to quote the individual fully and accurately otherwise that makes anything you say suspect if you can't even quote accurately. 

Publicly saying on the same individuals blog that you suck at this but are good at this makes you what?  A critic?  A teacher?

ancientmoney's picture

@Turd re: the silver OI . . .

Ted Butler has spoken of the other-than-JPM commercials, and called them the Raptors (JPM is T-Rex in his parlance).

Is it possible that the raptors smell JPM blood?  In other words, maybe they have inside-baseball info re: the actual amounts of physical available for delivery, and plan to force the issue.  After all, they saw what was done to MFG by the likes of JPM . . .

¤'s picture

Fish pics

The pics in the previous thread were just some nice web pics I put up as I was day-dreaming a little bit while looking out the window at the first snow of the year for the most part. I kind of figured there were many of you with similar winter passions or memories that could relate to them. I was daydreaming of being in 'my spot' and what the fishing might be like today. Probably great.

Those were not my kids but I was thinking of them also and when they were young  at this time of the year and all of those pleasant memories. They're now young adults and of college age. Time does indeed fly.

Here's a few pics of the real DPH about 12 years ago at the point before I slowly slid away from it for various reasons that I will resume in earnest some day again when it's relevant to myself.

Memories never really fade away and I have many, many true fishing tales over the years that were incredible experiences that one day will be realized again in fishing spots of old and new that have yet to be explored.

As far as Devils Hole and The Whirlpool etc. go, they are right up there with the best spots in N. America for sure where colorful and silvery aqua-giants ply the cold, swift currents that roared over Niagara Falls  miles upriver.

Here's few of the big one's that were released but not before they were captured with my net, then camera and my memory forever.

The formula used to measure/weigh the fish is length x girth squared divided by 775.

I've measured, periodically weighed and then released 100's of trout and salmon over a 20 year span at one point so i know the formula approximations run true. Depending on the characteristics of any given fish (skinny vs. super fat)  I can get very close to a fishes true wieght by measurement and by heft while handling prior to release.

Here we go down memory lane...

6247341691_a682745c57_z.jpg

38" female Steelhead approx. 18 lbs  Devils Hole

6247341683_8c7b024b34_z.jpg

35"  19# extremely fat girth male steelhead Devils Hole

6247842128_774922a05f_z.jpg

27 lb. Male Chinook Salmon Whirlpool State Park around midnight. Raging river behind me that you might not imagine.

6248233876_38d47d2d50_z.jpg

13 lb. 33" male steelhead Devil's Hole in January.

Someday in the future I'll be back there or somewhere else and hopefully resume that blessed and lucky  streak I was on back then.  Hundreds and hundreds of memories will have to do in the meantime.

Road_Scholar's picture

Turd, have you heard anything about Citi?

I thought there was a rumor that Citi also started to short silver joining JPM?  Was that Jim Willie or maybe someone else who suggested it?

Thanks and hopefully you have a cold beer in your hand!

rl999's picture

Silver closed green?!?!?

I am astounded it didn't finish red, even if it was -.01.

As for all the "TA" is dead...Even if it is, it doesn't matter until the vast majority that use it give it up, because it will continue to become a self-fulfilling prophecy.

I am not a trader, nor do I have any experience, but when some of the trend lines hold for years, even against manipulation as blatant as the '11 disaster, and the last two decembers...nuff said.

Anyone that watched the Colghan webinar would probably dispute the fact as well.

Besides when they are set to "annihilate" what do the HFT's guide from? Numbers derived from TA right?

I think that TA works 75% of the time, but when we have those waterfall events they destroy the signals and trends, and it takes everyone a while to regain their footing.

Colonel Angus's picture

So who's seeing

a Sunday evening margin increase so that we can smash the PMs as we have a shortened week with nobody caring about Monday and everyone looking for the fat man? Tuesday is a day off, then back to the pits on Wednesday....I'm thinking that Blythe and her bitchez will try to take silver down another buck or two on a thinly traded Monday to scare the crap out of everyone going into 2013. Eventually we get the HEH...eventually...

ag4me's picture

Maybe 12/21/12 is the end....

Most recognize the use of mass media to deliver the message of what the elite have planned...Could it be that this hype about a so called end of the world is simply a message that we are going to hit the reset button..........now.  The sudden unleashing of the metals would mark the end of the world as we know it from a financials point of view.....

Byzantium's picture

Great post Turd

I made a post about this disloyalty to JPM by former allies in the last thread on page 8. Thieves are falling out, and JPM/The Fed are furious.

But the only way that the longs can win is to stand for delivery. They cannot win a paper game against the Fed's operating arm. 

All the same, this is a gripping drama, and offers the glimmer of an opportunity for the bulls. The former JPM allies deserted for a reason; they can see something that we can't.

I used the analogy once before that the cartel is in a sea of petrol, having nightmares about sparks and matches; one spark is all we need, to start the fireworks.... (but we are not there yet).

debtless's picture

DPH

Awesome fishes. Looks like a great river too. I'd love to wet a line there sometime.

Sad-descent's picture

Indicators for physical supply

First hello, obviously new here.

What are some good indicators that I can watch for to tell if the physical supply in metals is beginning to get tight? Also does anyone have an idea of how pricing works with the refiners and their large customers?  Do they use the Comex for their settlement price.

Thanks a lot and thanks Turd for a great site...love the podcasts.

Zoltan's picture

Kitco Silver Lease Rates

Now I am the first person to hate on Kitco (Nadler is the best contrary indicator ever and I am the one who always posts the latest from their receiver in bankruptcy) but their lease rates are derived from market data.

Lease Rates -Derived from Market data lease_right_corner.gif
(Expressed as an annual percentage rate)
"Lease rates displayed are an indication only of bank to bank borrowing charges. The degree to which lease rates may be displayed as negative would suggest the degree to which there is a lack of demand to borrow the metal."
This is quoted from their webpage.  The degree to which their numbers are "wrong" is attributable to any errors or irregularities in the market data.  J Roche posted a great summary of how lease rates are calculated.  These lease rates have been spiking  because one of the underlying data points is spiking (perhaps LIBOR? hmmmmm. were have we seen that rate mentioned lately).  I just find the pattern of these spikes to be fascinating.
Sorry to all of you who could care less.  It is a big deal and someday, after the fact, they will be the smoking gun to all of the manipulations and fraud that takes place in the PM markets.  JMHO
Z
 
Capt. Willard's picture

Two things

Firstly, when TA is a self fulfilling prophecy and an instrument to manage our perception of a price action influenced by factors beyond our direct understanding, maybe we should concentrate on physical only. Life seems to confront you with a lesson until it finally sinks in. There's no need to waste time with staring at a monitor and chart study and indulging in group think activities. A market that moves like a brute and is controlled by far superior managers in terms of disposable capital, market knowledge and skills is dangerous to be traded daily, difficult weekly but really easy to trade physically, if our assumption of significantly higher future prices remains unchallenged.

Even Livermoore got cut down. You spend days analyzing, save money up and hit a few good trades and then marry a losing position for a minute too long and end up with hours of psychological grief? You get upset about yourself for giving your paycheck at the Washington farm back to the slave driver, because he lured you into a silly gamble, you knew you wouldn't win, when you saw the grin on his face. But you still did it? Oh, and I totally understand the concept of high leverage paper gains channeled into a lot more physical in the shortest time frame possible. You got a spread sheet about this with fancy graphs on your desktop? Right? Unfortunately this is all bullshit.

If the metals triple and quadruple from here within the next 6 years, how on earth can we be so greedy to try to outsmart a full spectrum HFT dominance controlled market, where physiologists track the stress level and likelihood to push the sell button of the average trader? If all we have to do is further the drainage of physical supply with our mediocre buys. What often seems mediocre in the beginning is a medium term wealth building habit, which can still translate into generational wealth.

If 80% of traders lose capital, how many ounces are in the wrong hands? In one year, two years? Greed eats brains.

If we were speculators, we probably would accumulate cash and wait for the 30% cyclical decline in price once or twice a year and layer our physical purchases into a bottoming price. Because if price moves lower, nobody get's hurt.

When the clueless investor can be pictured at brushing the brass of the Titanic, the paper metal gambler raides evacuated cabins for jewelry and the bars for 30 year old single malts in the confidence of taking it all with him into one of the later, less crowded rescue boats. I understand greed. I know where in my stomach the sensation of greed will be elicited by risk and reward. But this sensation is an illusion and serves as the gatekeeper between gamblers and investors. Leverage is your leash. The bone isn't yours.

Byzantium's picture

Christmas period.....

I presume that Asia is open for trade, so there will continue to be some daily market action? 

(Not that we should be watching; we all need a breather  ;-)  )

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