Surviving the Mid-Week
If I had told you on Sunday that, by noon Wednesday, gold would still be $1390 and silver $22, you'd likely never would have believed it. But here we are...
I was worried, too. Having China "closed" through today had me and just about everyone else quite nervous over the weekend, especially considering the way things traded on Friday. However, after some Monday weakness, prices have held in quite well.
Now don't go getting too excited just yet. Just because we haven't fallen down the elevator shaft again doesn't mean that we're out of the woods. In gold, price needs to put a 14** handle on things again and silver clearly needs to get back above $22 before we can breathe a little easier. Hold tight with fingers crossed.
In the end, though, unless you think that decades of market control by The Bullion Banks has ended, then the latest Commitment of Traders and Bank Participation Reports tell you everything you need to know about the future direction of price, regardless of what all the chart-readers and media shills think. As discussed here quite a bit recently (http://www.tfmetalsreport.com/blog/4768/getting-ready & http://www.tfmetalsreport.com/blog/4750/speechless-turd), the levels of NET LONG BULLISHNESS now attained by The Bullion Banks will soon lead to higher prices...MUCH higher prices...of that I am 100% certain.
Other expert discussion is provided below. First, this excerpt from Ted Butler's weekly review as provided by Jesse: http://jessescrossroadscafe.blogspot.com/2013/06/cftc-gold-and-silver-bank-participation.html. If you want to read the entire thing, I strongly suggest you subscribe at http://www.butlerresearch.com
"Since the BPR of February 5, the US bank category position (in effect, almost exclusively JPMorgan) has swung by a net 100,000 contracts, from net short 70,000 contracts to net long 30,000 contracts (all rounded). There has never been a move of such magnitude before. Over that same time, the total net commercial short position (in the COT) declined by 113,000 contracts, meaning that JPMorgan accounted for almost 90% of the entire commercial decline. It is not possible for that extreme degree of concentration and market share not to be manipulation, pure and simple.
And here’s the manipulative icing on the cake – JPMorgan was able to flip a net short position in COMEX gold of 50,000 contracts in February to a net long position of 50,000 contracts on a gold price decline of as much as $350. I would submit that the singular purchase of 10 million ounces of gold (worth the equivalent of $15 billion) within four months on a greater than 20% price decline could only be accomplished if the price was manipulated lower by the purchaser. No other explanation would be possible...
JPMorgan’s emergence as the big COMEX gold long changes the dynamic of the gold market. In addition to conclusively proving that this is the most crooked and evil financial institution ever to exist, it confirms the extremely bullish set up for the gold price...
Of course, if JPMorgan can continue to accumulate inventory on lower prices, we will get lower prices temporarily. But having JPMorgan confirmed as being on the long side of gold is a game changer. That’s why I continue to throw money out the window on silver call options."
Follow that up with this explanation of the reports from Gene Arensberg:
A practical example of this was evident today. Though traditional analysis claimed that gold surged due to Greek fears (http://www.zerohedge.com/news/2013-06-12/gold-surges), this was hardly the case. At 5:47 am EDT today, our pal Andrew posted this prognostication for Turd's Army members:
"Gold fixed at 1377.25 vs.pm fix of 1374.25, fairly quiet with China absent but noting more Indian & South eastern Asian ‘at market’ demand. The PM fix is where CB and Sovereigns seek to allocate as volume is far larger. I would be surprised if the sovereign size 1380 bids are allowed to fill again for a second PM fix this afternoon. Yesterday were the 1st sub 1380 PM fix since the 28th May and forced large BB buying into London clearing."
Lo and behold, what did we see? Just as Andy had predicted, a rally began precisely at 9:35 am EDT and led to a London PM fix safely above the $1380 level.
(As a reminder, anyone seeking to receive this type of vital and important market information on a daily basis need only to subscribe by clicking here: http://www.coghlancapital.com/daytrades-application?ak=turd_army)
Therefore, taking into consideration macro issues such as ongoing Chinese, Indian and other sovereign gold demand as well as firm-specific concerns such as JPM's dwindling vault supply and the setup persists for higher prices, not lower. So, keep the faith and continue to convert fiat into physical. The Spec Sheep, which continue to blindly sell paper metal as they chase dots across their screens, are destined to soon experience a very expensive lesson in the economics of supply and demand.