Pressing and Capping

We discussed in yesterday's podcast that today was likely to be a "Happy Tuesday". And so it is. But that's not important. What happens next is what matters most.

The absence of London Monkeys overnight allowed price to rally all the way into the Comex open this morning. As expected, though, price was immediately capped and thrown back from above $1350.

This is nothing new and we've seen it all before. As discussed yesterday, anyone trading and willing to be out overnight or for a few days should consider taking profits above $1350 as it's quite clear that The Cartel Banks DO NOT want to see gold trade clearly through there and, even more importantly, $1360. WHY? Because both levels are extremely important from a technical standpoint.

If gold can rally through $1350, it will violate the Cartel plans to paint a third recovery top on the chart. Actually, with the downward slope of the trendline being so steep, all gold really needs to do is continue to trade sideways for a while. If, eventually, it pops UP, all the better and the trendline will be officially broken.

IF and/or WHEN that downsloping line finally fails, we will turn our attention to $1360. Why is this level so important technically? This chart makes it pretty clear:

The reason I am optimistic and feel that it is more a matter of WHEN than IF is revealed on the charts below. Notice that with each Cartel capping effort at $1350, gold makes a higher low. This shows that momentum is building, not fading, and it gives the chart the appearance of a compressed spring. Of course, The Forces of Darkness might always coalesce into an overwhelming waterfall of selling. However, absent that level of desperation, eventually the cap fails and price moves higher.

You can see this on the HUI chart, too. The index has been stuck in a range for nearly four weeks yet notice the incrementally higher lows. This, too, is acting as a pressure cooker and it should resolve itself to the UPside. At this point, it needs a close above 248.50 to signal a breakout and an imminent run to 255 or so. We'll keep an eye on it.

And here's just a quick look at silver, which is also bouncing back today and above $21. For me, the key level to watch today is 21.10 to 21.15. A close above there would be a very positive first step in the road back to $22.

On the news front, there's nothing new:

  1. The Crimean Crisis isn't getting any "better": http://www.zerohedge.com/news/2014-03-11/diplomacy-fails-ukraine-putin-rebuffs-kerry-proposal-kiev-issues-ultimatum-crimea-su
  2. The U.S. economy remains in the toilet: http://www.zerohedge.com/news/2014-03-11/wholesale-sales-collapse-most-5-years-autos-lead-inventory-surge
  3. And there's still no sign of Malaysia Air flight 370: http://www.cnn.com/2014/03/10/world/asia/malaysia-airlines-knowns-unknowns/

And if you're wondering, I haven't decided what to do with my April gold call spread today. Part of me wants to take it off and hope to buy just the $1350 call back by Thursday. The other part of me says "screw it, it's not that much money and I really don't want to be out overnight". I'll keep you posted.

Have a fun day.

TF

80 Comments

Rainforest's picture

Second

First that is.

twippers's picture

Thanks

Thanks for all the info you give us turd!!

tyberious's picture

Let it ride

I'm still holding my May calls.

Arag's picture

Ukraine's Gold

Sorry if this has been discussed already...

But we have been informed of 40 boxes being brought to the airstrip and put on a plane... this cannot account for the 33 tonnes that everybody is speaking of.

Each box cannot weight more than, lets say, a hundred pounds. 40 of them would put the total weight to around two metric tonnes.

Enough to pay for a "service" but not the entirety of the reserves of Ukraine.

A comment, anyone ?

 

wildstylechef's picture

Crimia burst still holds

Quatro the boiling pot that is the Russians vs Ukraine someone is going to break and gold will pop 1400 plus on the news that war has started, because the man holding the bully position has the IQ of a 5 year old and the testosterone of a 15 year old. He will never back down. But the only people with courage enough to stand up to this bully will be the Ukrainians sadly enough, because Russia holds Europe by the testes as to gas supply on this frigid winter.

silver66's picture

Good God man slow down

I can barely keep up and pretend to work at the same time

Silver66

Turd Ferguson's picture

WAIT A SECOND!

MODERATOR

How about this? http://www.telegraph.co.uk/news/worldnews/asia/malaysia/10687223/Malaysia-Airlines-MH370-plane-crash-live.html

 Flight MH370 from Kuala Lumpur to Beijing departed at 12.41am on Saturday March 8. After that, what happened is not clear. Until Tuesday, the last known location was above the Gulf of Thailand, roughly 40 minutes into its journey.

But now the Malaysian Air Force say its radars tracked the plane as it turned West and headed back across Malaysia and into the Strait of Malacca, where it was last seen at 30,000ft at 2.40am above the small island of Pulau Perak.

malaysia-map_2847443c.jpg

California Lawyer's picture

Maybe it Wasn't a Missile?

What the heck do I know . . .

Great story, though, makes me wonder why this story now, and what else is going on that we should be focusing upon?

Ukrainian gold? $1,360 line on the chart?  ZH stories about US economy cratering?

​Nope.

My favorite: US lefties turning on their president.  That is the story to focus on.  Why?  Because any disparaging stories about the left that are intended to have any traction about the left have to come from the left.  There are so many right now that it is hard to track them all.  

The other story, although somewhat out there, is the Jim Willie prognostications.  It is like a Lay's potato chip: once you have one, you have to eat the whole damn bag!

4 oz's picture

Have a fun day

lol, Turd said to have a fun day---

joeblack's picture

Copper getting smoked

Luigi's picture

SHOCKED!

Can you imagine, there's no Gold in Ukraine anymore..

According to Ukrainian officials more than $20 billion of gold reserves may have been embezzled and $37 billion in loans has disappeared. In the past three years more than $70 billion was moved to offshore accounts from Ukraine’s financial system.

http://m.voanews.com/a/washington-react-fbi-helps-ukraine-recover-billions-stolen-by-former-regime/1868097.html

And of course they blame it on the former Janukovich regime.

SilverX3's picture

Waterfall in copper not helping silver

But there is long term support below 3.00 and can't rule out a quick trip to touch 2.80 before reversing. However, 2 days closes in a row below 3.00 may spell looming lower prices ahead.

Squipper's picture

Ref Wait a Second

Hi Craig,
I certainly find the story of the missing Flight MH370 intriguing, however as my eldest daughter is airborne at the moment it puts things in a very different perspective.
Miss Squipper #1 departed UK for Namibia earlier today for 5 weeks of kicking rocks (she’s a Geologist), looking for Lithium on this trip but has also worked on a few Gold deposits in Europe.
Thanks for all you hard work, the tip off on GOFO rates has been very useful.

Kind regards
Squipper

Swineflogger's picture

@Turd

Like I said last night - your Hollywood-like scenario is starting to get legs  .  . .

Silverhog's picture

Pulau Perak

I'm just going to throw this out there. Sri Lanka, even India is a hop skip and a jump from the newly adjusted flight sighting. I'm not so sure the plane is in the water. Could still be a hostage situation. Collecting all cell phones would be smart after the experiences of the 9/11 flights. Turning off  ATC transponder would clear it from control tower screens. Some cell phones claim to still connect and ring. But batteries must be getting low. Most were probably in flight mode or turned off. 

California Lawyer's picture

Copper Story is Very Important

Copper is misunderstood, for sure, because it it a dense, complicated story.

Here is a ZH link: http://www.zerohedge.com/news/2014-03-11/chinese-credit-concerns-clobber-copper-collapse-continues-lowest-july-2010

​This is a COLLATERAL problem.  Bank loans, based on copper as collateral, rehypothecated many times over, massive leverage, all of it is being unwound.  As it unwinds, copper is being sold to cover the defaulting bank loans.  Future supply is getting hammered, because all of this supply is coming on line at once.  

Derivatives, based on this collateral scheme, are coming unwound, and there is naturally a waterfall effect.  

This could get real interesting, really quickly.

Anytime collateral is impaired, there is a major problem, because of all of the derivative exposure up the chain.

Urban Roman's picture

About those ringing cellphones ..

Like I said in a longish comment in another thread: when you dial a cell phone, the "ringing" that you hear is properly called a ringback tone. It is one of a number of audio tricks that are employed by the makers of phones to convince you that they are working.

And the cell phone you are calling could have been dropped in a swimming pool and be dead, and you will still hear ringback until the tower network gives up on trying to locate it. There isn't really a connection unless the person on the other end answers.
 

SilverSurfers's picture

Of course

Kinda goes with those 30M$ opulent chandaliers. Experiencing Ukranian Notorious Corruption 17 years ago, first hand, a residual of Razputin's beloved Soviet Empire, one can be glad, and get a warm cozy feeling all over, that the corruption was all cleaned up by the one who killed in Kiev and then fled. And we now have the eagle screechers, claiming it was for a lousy 36 tons, or it must be for the oil, but, then, must have been done to put neo-nazies in power, but wait, surely it must have been done for placing newks in the Dombass,  .. get it? .... the list is endless, OF COURSE, so pick a reason, and run with it, and poo poo the US for every possible imaginary nefarious cause, (particularly farcical with a peace guy in the white house).

Hat tips are a good indicator where minds are at, eh?

After the Russians shot down Korean flight, and the fuss generated, China would not be so brazen against a commercial airline. Another War Hysteria guessaproximation.

=== Back to Seriousness about gold

Turk

TURK: indicated that Bafin gold rigging investigation is a big deal. Mad Max [572] touched on that as well, Libor and Gold rigging go hand in hand, reference McGuire's dead end at the CFTC, and more focus on gold rigging, which turk indicated would be the big mover in gold, and GLD creation in 2004, implying it was a fraud device from day one, and now 2 data point of increasing price and no inflows of late. Negative real interest rates, for inflationary default of debt, (the age old solution) but with gold held in check, to further perceptions and sustain that default on national debts. Banks condone Libor rigging and CFTC condones metal rigging. US gold is there, but everyone else's is apparently undeliverable. My friends, dots are being connected. Reason, Means, Result.

Dr Willie, Mannarino, .... Turk .. the list goes on, TF bringing in another great catch. Turk is a real good one. Now all we need is Egon, for economic doom and gloom, Dr Roberts for War hysteria, and Sprott to explain yet again, that supply and demand dont add up.

Maestro's picture

So Proud....

USEagleFreedom

GoldisMoney's picture

Gold backed bitcoin

I don't own bitcoin for the simple reason it's not backed by labour units of work 

it's a computer generated unit.

so would it not make cents to match up gold and bitcoin? The bitcoin could be based on what's in the ETF vault 

realitybiter's picture

Dr Copper

got his degree from a diploma mill university.

Look at the last 20 years.  From 1995 to 2000, the stock market exploded, yet that idiot, so called "doctor", fell in half, failing the forecast of the stock market and the economy.

I think the failed Fed, being nothing more than a whore for the private banks that own it, has ripped away any ability that the price of anything, including copper, to reflect anything meaningful regarding the economy and the value of currency.

Warren Buffet is the son of Howard Buffet.  Howard knew the truth of fiat money and preached about its faults.  His son however, thinks his Dad was an idiot, and his wealth proves it. riiiiigt.

Copper, again, proving its academic short-comings, has been in a downturn for 3 years.....failing to predict stock earnings increase during this time....

couple this with the dollar which has submitting plans to the financial planning dept for building a new 3 story basement...

In 2001, gold spent all year going up, and copper, going down....yet by 2002 copper started a massive move up.  This 3 year downturn is the longest of coppers last 20 years....even the 90's had some big rallies as it descended.  IF copper has a phd in econ, then Gold is the dean of the school.  And the dean is saying that copper is about to turn up.  It (nominal price) is no longer about economic activity.  It is about Keynes, money printing, and Fed whores.

Speaking of whores, MW had a little expose about "what if you invested $10k at the bottom of the market in 2009....of course they made PM investors look only slightly smarter than those that stayed in money markets, and stock investors geniuses....cherry picking?  The last time they could have ran with that analysis was 1999.....oh, which reminds me...what if they stepped back a little further and expanded their argument...."what if you had invested your money in 1999?  Your $10k in stocks would be about 60% less than if you had put it in PMs....(spx/gold went from 5 to 1.4)

cavalier's picture

Turd called the Sell this morning trade

Turd

Great call on sell the move this morning you mentioned in the podcast (I know you do not provide trading advice). Yesterday you said that if you were looking to take some money off the table, sometime in the morning today would be the time to do so.

Unfortunately, I just watched the move, but your prediction was uncanny. Do you have a crystal ball?

Thanks for the great podcasts! I listen to them on my way to work to get me prepared for the day.

realitybiter's picture

mad hat

I think any US citizen claiming wrongs about ridiculous opulence of other nations and corruption is giving a massive blind eye to our corruption.  Our political class live like Kings, flying privately, taking whatever junkets they want, at enormous taxpayer expense.  When they get done with office they find jobs at the very corporations they beneftted, receiving millions.  Rubin at Citibank?  Liz Fowler at JnJ, Tauzin at the pharma lobby?  It is disgusting.  Only a blind idiot would ignore our corruption and cheer that we are righting other country's corruption. 

And to add insult to injury, if you bark about it, you get a full body cavity search from the IRS, under guidance from the top.  And when the head of the IRS gets called on the carpet, she legally pleads the 5th.  If you are not disgusted with our Country, you are either stupid or willfully naive, which is just another form of stupidity.

CPE's picture

RE: Gold backed bitcoin

If Bitcoin were simply the payment system for allocated gold ownership then it takes gold's moneyness and helps with the modern day currency payment systems (like internet transactions). 

So, if you are talking about a virtual gold bill with bitcoin as the delivery device of the gold bill then I'd be willing to listen to more. 

Anything other than that would probably be a frankenstein that does more harm to bitcoin and gold than keeping them separate.  I frankly like the idea of currency not being used as a store of value and getting gold further and further from political hands.

Valuation should stem from gold, gold bils for currency.  If not gold bills then just scrip with no illusion of it storing value for any medium term length of time.

Response to:  Gold backed bitcoin

okscouter's picture

So

Does anyone notice that gold and silver are seemingly wacked now whenever the dollar declines almost as if they were tied together via some type of derivative?

Also if copper is pushed down significantly , will this cause production cutbacks, and as a result there will be less silver by-product available for sale, thereby increasing the squeeze on available silver?

Also Iron is being sold off on China economy concerns, what other by-products of both Iron and Copper production might find themselves in short supply if production is reduced?

yseclov's picture

BE RIGHT AND SIT TIGHT

That is what I am doing. We are in a muti- year once in a lifetime opportunity if we hold the juniors.I am long gldx and sil. The top holding in gldx have a average 500% minimum potential.

SilverSurfers's picture

Should be Famous

If you are not disgusted with our Country, you are either stupid or willfully naive, which is just another form of stupidity. (2014 RealityBiter, TFMR) That's a good one. Can one actually have disgust, about constitutional money, limited government, nanny-granny state, totalitarian enslavement, etc etc, yet be guarded about convenient theories?

Maximus's picture

Russian Spring

The link is to an English translation of Alexandr Dugin's set of scenarios to resolution of the Ukraine crisis.  Dugin is an advisor to Putin.  Some of Dugin's scenarios jibe very well with Willie's predictions/assessments of events unfolding. Dugin's piece was published on his Facebook page.  A must read from an investment standpoint.

http://www.nationalreview.com/corner/373064/putin-adviser-publishes-plan-domination-europe-robert-zubrin

Turd Ferguson's picture

Double hmmmm.

MODERATOR

"Malaysian authorities have previously said flight MH370 disappeared about an hour after it took off from Kuala Lumpur for the Chinese capital Beijing.

"It changed course after Kota Bharu and took a lower altitude. It made it into the Malacca Strait," the senior military officer, who has been briefed on investigations, told Reuters.

That would appear to rule out sudden catastrophic mechanical failure, as it would mean the plane flew around 500 km (350 miles) at least after its last contact with air traffic control, although its transponder and other tracking systems were off.

A non-military source familiar with the investigations said the report was one of several theories and was being checked."

http://www.reuters.com/article/2014/03/11/us-malaysiaairlines-flight-idUSBREA2701720140311

CPE's picture

Hijacking

"Malaysia Airlines has released a statement saying that it is "shocked" by allegations aired in an Australian news programme of a past cockpit security breach involving the co-pilot on its missing passenger jet.

Among those aboard were First Officer Fariq Abdul Hamid, 27, who along with a fellow pilot violated airline rules in 2011 by allowing two young South African women into their cockpit during a flight, one of the women told Sydney-based Nine Network.

The report included photos of the women in the cockpit, with one appearing to show them posing with a man resembling Fariq. Passengers have been prohibited from entering the cockpit during a flight after the 9/11 attacks on the United States.

"Malaysia Airlines has become aware of the allegations being made against First Officer Fariq Abdul Hamid which we take very seriously. We are shocked by these allegations," a statement by the airline said."

http://www.telegraph.co.uk/news/worldnews/asia/malaysia/10687223/Malaysia-Airlines-MH370-plane-crash-live.html

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