Still Looking Good

It seems like everybody is now jumping aboard the "Double Bottom and Bull Market Resumption" train. That's fine. The train may soon get a bit crowded and need to offload a few non-believers for a few days but, for now, it just keeps speeding along.

First of all, let's talk about something it seems no one else has noticed...What the heck happened to The London Monkeys? Are they suddenly on vacation? Maybe the floods in England have kept them from manning their cubicles? I don't know and I also don't know when the last time was that we had three, consecutive days without a 7:00 am London time beatdown. This must be watched and they'll likely assert themselves again as soon as tonight...but...what could this mean?

  • The Big Manipulator and key to the EE is JPM.
  • Therefore, JPM is likely the key London Monkey trading desk.
  • The London Monkeys usually act 4 out of 5 days per week. Their goal is to stem any rally out of Asia with the intent of keeping price from springing forward at the next day's Comex open.
  • JPM is now NET LONG Comex gold.

Could this rather unprecedented London Monkey standdown be a signal that JPM is ready to release price to the UPside, thereby profiting while squeezing the Spec Shorts and their fellow Bullion Banks? Maybe...let's see what happens tonight and Friday before jumping to any conclusions.

OK, now to the charts. First of all, gold looks great. It keep charging higher. As you know, it took out the 100-day MA on Monday and then surged even higher yesterday. This is a very bullish sign. Lots of momentum. The key resistance that nearly everyone seems to recognize will now be the 200-day MA (today near $1313 in the Apr14) and the area around $1320. Because so many folks are focused on those points, you can be almost certain that resistance will appear there in a classic self-fulfilling TA sense. That's fine. A little consolidation would be OK. As I mentioned last evening, though the bull market is resuming, the metals are not going to go UP every single day. Just use the dips and weakness to continue to accumulate.

And this weekly chart shows you where the next key resistance will be found once $1320 is in our rearview mirror:

Now, here's the BIG NEWS of the day....I think silver is finally ready to begin moving higher. Now, as you read this, keep in mind all my talk about multiple resistance levels etc keeping silver pinned below $22. That hasn't changed. You should also keep in mind, though, that two weeks ago I gave you "gold to $1320 by Valentine's Day". This looked pretty bleak with all of the resistance ahead at $1260 and the 100-day but here we are...getting close.

Why do I think silver is finally ready to bust through $20.50-20.60 and begin moving through $21 and toward $22? Well, one of the key inhibitors for silver these past two weeks has been the coincident pressure on both copper and platinum. Gold was rallying but the weakness in the other two metals kept holding silver back. Look now at the recent turn in platinum:

And check out copper. I've been thinking that copper would be held in check until mid-month, just like it as held down until mid-November ahead of the Dec deliveries. Well, it's now mid-month ahead of March deliveries and whaddayaknow....Could this be the beginning of another copper rally toward 340+?

Along with platinum and copper, check out crude! I though this rally would stop at $101 but, so far, it's not. Could $102+ be in the future? There's a lot of talk about a number of "hostilities" beginning shortly after the Olympics conclude, Russia-Ukraine being a still unresolved issue among others. Is this why crude keeps charging higher. And if gold, crude, copper and platinum are rallying, can silver really be that far behind?

And so, here you go. First, here's a daily chart of silver showing the exceptional bottom near $19 as well as the oppressive cap at $20.60. It's that cap that is about to break. WHEN it does, the attendant short-squeezing will pop price higher very quickly. That's almost three, full months of price under $20.60. There has to be a a cornucopia of buy-stops above there.

But on the weekly chart, you can still see the challenges ahead. Once above $22, silver will roll toward the late August highs near $25 and, from there, it will be a quick trip to the ultimate test of $26. Once back above there, everyone will be screaming about $36 silver being inevitable and in reasonably short order. But let's not get ahead of ourselves. For today, all I'm prepared to get excited about is the final break and rally through $20.60. I expect to have that level behind us as soon as Friday and no later than sometime next week.

For more on silver's potential, be sure to see this from Fitz at Citi: http://kingworldnews.com/kingworldnews/KWN_DailyWeb/Entries/2014/2/12_Silver_Price_Set_To_Shock_Traders_With_Stunning_55_Surge.html

Finally, let's close today with a discussion of the HUI and the miners. It took a lot of gas to get it UP and through the 200-day yesterday and, frankly, a lot of individual issues like EXK have gotten short-term overbought and need a brief pullback. The HUI will also likely pause here and consolidate around the 200-day much like it did around the 100-day. Though I don't expect this consolidation to play out over 3 weeks like the 100-day did, the HUI could easily oscillate around the 230+ area for the next week or so before charging higher again. Let's be sure to watch this closely because IF it does convincingly break through the 200-day and begin charging higher again, you're going to want to own some of these miners. The leverage they provide is significant and you'll be able to make some considerable fiat, which you can convert into phyz at a later date.

OK, that's all for now. I'll have a podcast for you later today so be sure to check back when you can. Also, with the strange week I've had, I was unable to schedule a guest for A2A tomorrow. So, instead, it's just going to be me. I'll set up the webinar and, if you'd like to ask me questions directly about anything on your mind, feel free to join us.

Thanks and have a great day!

TF

54 Comments

tyberious's picture

Furts

Now read!

pbreed's picture

Keep and Bear

2nd

ReachWest's picture

Karma Moment? On the Cusp?

Someone in charge, somewhere in some small dark Federal Reserve Trading (metals manipulation) room lined with screens .. must be getting a wee bit nervous right about now. They're out of real Gold to use for leasing, they're up to their ears in paper Gold derivatives, their cover is mostly blown - in that the cat is out of the manipulation bag - and the price is approaching a key point - above which they lose control (perhaps for good).

Karma sucks for them.

Hmm .. I wonder ..or .. are they still in command and this is part of the strategy?

Cusp of $1300.

Oh yeah - Third!

Louie's picture

Fourth

Twice as good as a #2!

Turd- Glad to hear your mother is doing better.  Good work on that fist command with a promise. 

We may never buy silver under $20 again.  May be last chance to buy gold under $1,300. 

This time, Louie believes, it really is different. 

wildstylechef's picture

pushing on 1300

lets go gold!

Turd Ferguson's picture

And this needs to be read by

MODERATOR

And this needs to be read by everyone:
http://www.oftwominds.com/blogfeb14/doomed2-14.html

Turd Ferguson's picture

And I failed to mention GOFO

MODERATOR

Rates of which are falling off a cliff:

04-Feb-14       -0.00400    0.02600    0.03600    0.08000    0.14600                                        
05-Feb-14        -0.01600    0.00600    0.02400    0.07600    0.14800                                        
06-Feb-14       -0.01200    0.00000    0.02000    0.07400    0.14600                                        
07-Feb-14        -0.01400    0.00200    0.01800    0.07200    0.14600                                        
10-Feb-14    -0.01400    -0.00200    0.01200    0.06400    0.14000                                        
11-Feb-14    -0.03400    -0.02000    -0.00400    0.05800    0.12600                                        
12-Feb-14    -0.04800    -0.02600    -0.01200    0.04400    0.12200

4 oz's picture

;^)

Is it me?
Or are there suddenly encouraging reports showing up more and more??
 
Pseudozero's picture

leverage

Simple arithmetic will do. The Fed is leveraged 72:1. For every dollar it removes, it actually removes 72. The product of 72 and 20 is 1,440. The Fed has actually removed nearly $1.5 trillion of liquidity with its $20 billion tapering.

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

we're talking about 'per month' here?

and on the other hand...turd's telling me to lever myself up on the miners.

mixed signals or what?

ima just keep stacking thanks.

Dr Jerome's picture

Cautiously optimistic

The past year or two I have had to control my emotions about metals by strictly viewing them as insurance for a collapse while I curtailed my trading. the past few weeks have allowed me to invest some hope that they might actually have a good year. If indeed, we are seeing the opening to a solid year, I don't want to miss the train. I sense that investing in miners or mining ETFs provides me a seat on that train. There are a lot of experienced traders who freely offer good advice here. Turd's daily charting and direction calls need not be mentioned as the best metals analysis on the internet.

Thus. I am currently plotting out a trading strategy that will be cautious about beatdowns, but also catch the train. I hope to pay off my house by next Fall. "All Aboard!"

Dare I hope?

SS121's picture

silver chart moving up... or is this a repeat of December ?

Here is the silver chart for December 2013.  (2 months ago)

Notice the approx 8 day run up to almost 20.50 on the 11th

agdec13.gif

Now notice a similar approx 8 day run up on this month's silver chart (below)

It's not shown on the chart but today (12th) we've already bumped up to 20.51

agfeb14.gif

Now, here's what happened back in December, after the 1 dollar'ish' 8 day run-up to around 20.50 (see green line below)

ag12122013.gif

Yep,  alllllll the way back down to the low 19s.  

They are stuck in this range, so they use what room they have to build build build and then "BAM"... back down to the bottom of their range.  But they won't be able to do this for ever.

They will have to move the silver chart up, but is this the start?  Or is this even what the move up will look like?

Moving up? Ehhhh.... Once they have to move the charts for real, i expect a big "news" story and a really really big and sudden move up, like to 80 or 200 or some other number that might seem ridiculous to our current conditioning.    Then the slow trickling decline from there. 

We will never slowly build and decline all the way to 80 or 200 or whatever, because that would bring too many people into Silver.  It will be sudden and quick followed by a slow sentiment killing decline.  To induce thoughts of "Dang it, I missed the silver move" and "better sell now, before this bubble pops" etc.

So according to that thinking, this probably isn't the start of 'THE' silver chart move up.  If it is, they need to really step on the gas.

ks

Pseudozero's picture

i want on the train too.

i just can't read the language on the ticket.

hahaha.

Louie's picture

Taper now at $20b

I have no idea how I missed the news.  Am I the only one who missed the announcement that the Fed tapered another $10b per month in January?  I saw it in the CNBC article the other day and thought it was an error.  Saw the same amount referenced in the article Trud pointed us towards.  Asked my friend Google, and sure enough, there are a few articles which reference the change. 

IMOHO- The biggest effect will be on the stock market.  Most of the QE money has not been making it into the economy, instead it has been sopped up by banks and then plugged into equities.  If they think January was a bad month following the December taper, just wait until the second round kicks in. 

Owtovit's picture

WTF?

http://www.zerohedge.com/news/2014-02-12/surreal-news-du-jour-spain-turkey-jointly-build-aircraft-carrier

yep that will bring lots of jobs and sort out both economies as long as the Military Industrial complex gets paid.....

head, wall, bang!....repeatedly until numb

WTFWTFWTFWTFWTF...MEH

Stack till I drop

Edit-off topic.....but WTF!....the Krug will be so happy

securi_D's picture

RE: Silver Chart Moving up

This month so far is turning out nothing like December. Just by first glance (and assuming we close above $20 today), nowhere in December were there 3 consecutive days where the price of silver closed above $20.

While I agree with your comment about not slowly building to 80, I think we will build to $50 before exploding higher. All of the previous fractals (assuming the past predicts the future... which is a cardinal sin in trading IMO so take it for what it's worth) say it's going to happen until it doesn't. You will notice there is a nice base build/slow crawl up, followed by a sporadic movement higher, then comes a crash. As time moves forward, it seems like the moves get more violent as well as the time it takes for the price to crash back down increases. This is following suit to all of the previous patterns.

And bringing too many people into silver would probably be exactly what they would want. Mark up the price up really high, sucker in the masses to buy at overpriced conditions, then dump the price. The difference between the masses and everyone here in Turdville is that we are already in position for a move like that cool

-_D

47 Protons's picture

EXK & Silver Ponderings

Turd,

Thank you for reminding me that I needed to do some basis adjusting on my EXK!!  It's back in the black for me!!  :-)

Now, about silver...  I had this crazy thought when I was falling asleep...  or waking up... 

SS121 pointed out that Silver will be the undo-er of TPTB (crudely paraphrased), which fits well with this crazy thought of mine.

Are, maybe, the TPTBs trying to bring more separations between Gold and Silver, so when Gold has to reset...  maybe Silver will "reset less"?

At multi-hundred dollar silver, I'd hate to think what solar panels will cost!

-e

ps. Oh, and, I don't mind the polite punches to the stomach about Bitcoin.  :-) My grand stash of 3.32 BTC (that I mined) were:

  • A pain in the butt to set up, kind of like those guys on "Gold Rush" who don't have a "fricking" clue.
  • True enough... mined while I was either drinking beer, or sleeping.
  • At the time, not worth the power my computer was using while I wasn't sitting at it...
4 oz's picture

Jim Willie 2-12-14

If ya have the time...

Ensues's picture

Great Read

Here is another must read from a brother in arms who loves metal as much as we do.  This is a great piece on how the taper effects the emerging markets.  Always worth a few chuckles (due to writing style) and the author is a master at making very complex subjects easy to understand.  After Turd this publication is at the absolute top of my must reads.

http://www.mauldineconomics.com/ttmygh/the-end-of-the-innocence

Enjoy and keep stackin!  

Moksha's picture

Alexco Resources

Does anyone know why Alexco Resources dropped 14% yesterday? Can't find any news that would justify the sell off.

tyberious's picture

http://philosophyofmetrics.com/2014/02/12/sdrs-and-the-new-brett

Moving forward the potential threats posed by delaying the implementation of the SDR system are real and measurable.  The reforms could come too late for effective sovereign debt restructuring.  Or the debt restructuring, when finally implemented, could be insufficient to meet the expanding debt contracts under which the economies of the world toil.  Banks exposed to debtors could see the confiscation of their assets.  We are already seeing this as China has and will continue to purchase banks within the United States.

The rest of the world will not wait for Congress.  But it’s my prediction that Congress will in fact pass the 2010 Code of Reforms and allow for the restructuring of the I.M.F. Executive Board.  Its matter of timing, planned or unplanned. From the moment the reforms are implemented, the dollar will see multiple devaluations staged to coincide with a multi-staged restructuring of the debt.

It’s important to mention that with the passage of the reforms, the world will not see an overnight immediate response.  The new system will take time to fully integrate.  The Global Currency Reset will happen in levels as currencies are allowed to free float within the parameters as set forth by the SDR composition of each country.

As stated previously, this composition will include the following economic fundamentals:

  1. GDP – Self Explanatory
  2. Human Development – Research how China engineered a middle class to fill the empty cities they built over the last ten years.
  3. Ecological Sustainability – Programs through the United Nations make more sense now.
  4. Concentration and Diffusion of Assets – Investigate precious metal price manipulation.
  5. Income – Examples include the growing middle classes of not only China, but also Vietnam and other emerging economies.
  6. Demographics – Immigration and the mass movement of people are directly related to the planning of the new system.

The economic system as it stands today is out of balance and will be corrected by a supra-sovereign reserve currency by way of the SDR mechanism.  Between the time the reforms are implemented and the year 2018, the currencies of the world will slowly adjust and fluctuate as their true SDR composition weight settles out.

As another pattern of note, the Basel 3 regulations from the Bank for international Settlements are also set to be fully implemented by 2018.  They were originally scheduled to be completed by 2014 but also had to be pushed out because of the delays within Congress in regards to the I.M.F. Code of Reforms.  This is not a coincidence.

As we touched on in a previous post, the SDR compositions will be segmented into different regions.  Based on what I’ve learnt and what information is publically available, it is my best estimate that these regions are going to be as follows:

  1. Asia and Pacific Region
  2. Europe
  3. Lower Middle East and Northern Africa
  4. Upper Middle East and Central Asia
  5. Western Hemisphere
  6. Southern Africa
  7. South America

Right now the Ukraine is the hinge between Central Asia and Europe.  Syria is the hinge between the Upper and Lower Middle East.  The border area between both will become major trade zones with Lebanon regaining much of its past glory.

The hinge between the Western Hemisphere, comprising Canada, Mexico, and the U.S., along with some Central American countries, will find its hinge in the Nicaragua region as the Chinese funded alternative canal project takes form.  This new canal through the center of Nicaragua will include two international airports, one at each end, oil and gas pipelines, and a shipping lane almost ten times the length of the Panama Canal.  It will take eleven years to complete and is considered the largest construction project in the history of the world.

The SDR compositions themselves will be based on both macro and micro weights and measures.  The macro breakdown of each country’s currency composition will be as follows:

  1. 25% Production Commodities (such as oil, gas, rice, wheat, iron ore, etc…)
  2. 25% Foreign Reserves and Precious Metals
  3. 50% Fiat – Pegged to increase and/or decrease based on the fluctuating values of the above 2 factors.

How the SDR composition system is setup will in essence work as a form of self-limiting rent seeking for the purpose of economic balance between the small elite organized group and the larger worker disorganized group.  For a more detailed explanation of rent seeking and what is being proposed here, read the post “What Are Conspiracy Theories?”.

Gamble's picture

Ok here comes the next run at 1300

Ralley caps boys and girls

renozep's picture

@Moksha

I also hold Alexc0 and have been looking  with no success- don't see any news to explain the big drop.  All my other miners did fine. 

Iceberg Slim's picture

Turd..

Thanks for some of the best analysis on the web!! These charts really help put things into perspective and the fact that you update them on a consistent basis and explain them so well is huge in navigating these muddy waters.

SS121's picture

Dec vs Feb silver charts

Yes, lots of things different than December.

But the December and February silver charts are similar in that they went from low 19 to about 20.50(the high) in the 8 days or so prior to the 11th/12th of the month. 

I knew that "maybe the silver chart goes back down accordingly" (in Feb, as in Dec)  wasn't going to be a popular observation.  And i'm not even really defending it, as i don't really have an opinion on it to defend.  I'm pro-Silver all the way. but anyway...

You kinda lost me on the "fractals" and TA stuff.  My observation is from the perspective that the silver chart is nothing more than a visual device used by it's owners to manage the public's perception of the monetary nature and value of real silver.  

Not discounting your info, just saying that those points weren't considered when pointing out the Dec to Feb similarities.

And just for the sake of discussion, i don't even think they will slowly build all the way to 50.  It would create way too many newb stackers. 

It's going to be these low range shenanigans (<30? only) until the next big move on manufactured news,  imo.

Urban Roman's picture

Looks like they have monkeys in New York too

... let's see what they can do ...

november4's picture

What happened to the miners today?

mike97's picture

Alexco

They need financing before they can reopen the Bellekeno mine or start mining the Flame and Moth deposit. Price may drop  and/or dilution will occur for financing.

infometron's picture

@Moska & Renozep Re: Alexco

I noticed Alexco had been downgraded by someone for some reason. Having taken a bath sticking with Colossus, and having still been in the black with Alexco, I dumped as fast as I could, minutes after seeing starting to fall through the floor...

Ditto with Carpathian of late...

Of course averaging down can work on occasion too, viz., Pretium :^)

Edit: Just read mike97's post... that's likely the reason for the downgrade

kryton619's picture

@Moksha

Zacks cut shares of Alexco Resource Corp (NYSE:AXU) from an outperform rating to a neutral rating in a research report sent to investors on Monday morning, Stock Ratings Network reports. The firm currently has $1.90 price target on the stock. Alexco Resource Corp. (USA) (NYSEMKT:AXU) shares closed at $1.77 on last trade day, by losing -14.08%. Stock 52 week range is $0.90 – $4.47. Company’s market capitalization is $110.76 billion.

infometron's picture

@Louie Re: missing the taper news

Here is a webpage that reports economic metrics as they're posted:

http://www.fxstreet.com/economic-calendar/

(nice little alert sound too...)

Syndicate contentComments for "Still Looking Good"