Looking To BTFD In Silver and Gold

Wednesday, February 22, 2012 at 12:26 pm

Wow, this is crazy, isn't it? There is so much crapola going on in the world that, seriously, I don't know where to start. So, I guess I'll start where I'm most comfortable...with the ruler and the sharpie...and wait till you see what I've found!

As I've mentioned quite a few times as of late, this 20%+ equity rally over the last three months makes me nauseous. While I feel that the perfect 45-degree rally is a clear sign of Fed manipulation, others argue that it is the rational result of The Great Global Liquidity Flush of 2012. Maybe they're right? Maybe we're all right? Who knows? All I know is that the charts don't lie and they are what they are.

To that end, below is the most important chart of the day...perhaps of all 2012 to date. Note that since the panic beatdown and collapse of December, gold has been in a similar pattern to stocks. Take a look:

From this chart, I think we can deduce several things:

Since it's not just gold and equities that have this 2012 pattern, there really is a Great Liquidity Flush happening and it will likely continue throughout the year as the central banks desperately try to maintain the illusion of recovery and hope.
The Cartel is still active in trying to manage gold's ascent. Note that this range rises a perfect $100/month.
If we expect The Great Liquidity Flush to continue then this chart pattern should continue, as well.
The current floor of the channel is at $1720. This means that by late April, the floor of the channel will be at the old all-time highs for gold, near $1920, and the top side of the channel reaches there by late March.
Buy gold. Buy it on the dip or buy it on the rally. In the end it doesn't really matter. Just buy it.

Now, the next question is: Can we get a dip to buy? Maybe. In fact, I kind of like our chances that we'll get that dip, sometime between now and Thursday afternoon.

First of all, the POSX is rallying. In fact, at 79.30, it's actually above the level at which it was trading pre-Greece on Monday. Interestingly, the metals are holding in there today even while The Pig strengthens. I have a hunch, however, that a few WOPRS may eventually trip into "sell" and take the PMs down a few dollars.

So, where might that dip take us? In gold, I will be very excited if we can get a dip to 1740-45. You can clearly see that area on these two charts:

In silver, the BTFD area is also clearly defined. Take a look at these two chart first:

And now check out this hourly chart. If a dip develops to 33.70-33.80, it sure looks like a solid buying opportunity. The only thing complicating matters somewhat is the pending expiration of the March options at the close tomorrow. Keep that little item in mind if you are attempting to trade today and recall how SLV call holders were treated when their options expired back on Friday.

Lastly, I'm trying really hard to bring myself up-to-speed on this Greek "bailout" deal. If you want to take a crack at it, too, try reading this:

http://www.zerohedge.com/news/summarizing-open-questions-surrounding-second-greek-bailout

and this:

http://www.zerohedge.com/news/psi-scenarios-and-greek-bond-trading-thoughts

and then consider this:

http://www.zerohedge.com/news/iifs-dallara-warns-holdout-greek-bondholders-could-kill-successful-greek-deal

What I can't figure out is why a powerful hedge fund would allow themselves to get screwed in this deal. Why wouldn't a loose consortium of hedge funds band together and deny the deal? Because the ECB and the Fed are so afraid of a CDS trigger, couldn't these funds force them to sweeten the deal in a sort of 80s-esque "greenmail" attempt? They could even short JPM and GS, profit from putting the squeeze on and then close those positions right before they accept the sweetened deal!

Anyway, it seems to me that there is a palpable sense of desperation to avoid CDS triggering through a Greek default. In the next few weeks and days, there will be some wild volatility as markets react to "deal on" and "deal off" rumors but, in the end, a deal will be struck that will be much more costly than that which was announced yesterday. Costly = more euro and more dollars. Costly = continuation of the Great Liquidity Flush of 2012. Costly = gold and silver continue to rally and perhaps even accelerate to the upside.

Of course, I could be wrong. Maybe default is inevitable next month. Gonzalo seems to think so:

http://gonzalolira.blogspot.com/2012/02/fearless-prediction-on-march-20-greece.html

However, this event is PM-positive, too, as breaking up the euro will also drive the PMs significantly higher. Maybe not so much in the near term but definitely in the longer term.

So, there you go. That's all for now. Crude is still over $106 and, the more time it spends at $106+, the more certain you can be that it is headed to at least $115. Got UCO?

More later. TF

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Buffett billions keep a tight lid...

Submitted by Patrancus on February 22, 2012 - 2:30pm.

Buffett billions keep a tight lid on his Pebble Beach home, heard about this the other day when they media was touting his expert opinions of how America's rich are not taxed enough, and he lives a spartan lifestyle in a modest country shack in Omaha, like I even earn the chunk of jing his secretary makes in the first place. This guy is so f**k*** rich he forgets about his super secret Pebble Beach estate. Tried to locate something on it, it is off the map folks could not locate even a smigen of info on it. When you are clever as crusty old Warren in making fools out of the sheeple, you use the billions to keep your info out of the sheeples pasture so they won't be able to dissect your true nature and intent in keeping the sheeple fat & happy, with plenty of bread and circus.

Cap at 34.40

Submitted by Lightning on February 22, 2012 - 2:30pm.

They seem to be serious about capping silver at 34.40. What is in store for us on the other side of 34.40? I can hardly wait.

Could be opEx shennanigans?

Submitted by lairdwd on February 22, 2012 - 2:31pm.

That's why I wanted to see max pain. Damn. Somebody is probably long and strong on crimex and has to push it up to avoid the margin clerks. Also with paladium and platinum very strong, it was supportive to gold.

Let's see if it can hold on globex, and if silver can start to catch a bid. Cartel is still nowhere to be found... so it could be THEM doing the buying. Two bids wiped out all the asks in two $5 chunks. Very nice.

did the bernake just speak?

Submitted by adrock on February 22, 2012 - 2:32pm.

what's up with the vertical in AU (not complaining)

I was looking to BTFD but have to delay a little.

GSR @ the LCS

Submitted by survivalwstyle on February 22, 2012 - 2:34pm.

from the strEEt to TFMR...this is not as easy as it lOOks or sounds from the retail end....of course again, unleSS you have a hOOk up...if you do. shOOsh.

and we are on blast oFF alert right now....so taking the last tick i get AU 1770 Ag 34.25

joe blow walking into the LCS this is the breakdown. we take your AGE and you get a credit of 1770.

you then get ASE's we are seLLing at 40. 1770/40 = 44.25 you get 44 ASE for 1 AGE

so you want .999 rounds....those are 36.25 a pop. 1770/36.25 = 48.83...i'm a nice guy. you would get 49 rounds today for 1 BU AGE.

i am giving my patience a test....but i just have a tiny bit of fiat left...i can buy guns aMMo and TP if we never come back....

Just a big buyer - and it wasn't me!!!

Submitted by DeltaCharlie on February 22, 2012 - 2:35pm.

http://www.zerohedge.com/news/eerie-replay-2011-gold-spike-abruptly-over...

Copper

Submitted by Dr Jerome on February 22, 2012 - 2:36pm.

Dr copper is making a bit of a move here with the other metals also.

must of been lists of stop orders just above 1760

Submitted by Groaner on February 22, 2012 - 2:45pm.

nice move

Pbfurn

Submitted by Hondo on February 22, 2012 - 2:48pm.

Thanks

Hondo

Greek Debt

Submitted by Hanuman on February 22, 2012 - 2:57pm.

Biderman sums up the Debt situation fairly well in this 3-min video:

http://www.youtube.com/watch?feature=player_embedded&v=nlxwtJ0nWkg

Looks good right through 1780

Submitted by lairdwd on February 22, 2012 - 2:57pm.

this one looks good right through 1780, which trader dan identified as next resistance between 1760 and 1800. Cartel nowhere in sight, and are on the long side of the trade themselves. Silver is another story. They do seem to be pushing down on silver a bit.

There are NO SELLERS in gold, platinum and palladium. I'm getting long again.

Looks like cartel is long gold, short silver.

Dow must be green

Submitted by Dr Jerome on February 22, 2012 - 2:59pm.

"Must... push... Dow... into... green!"

This isn't going to end well!

Submitted by DaddyO on February 22, 2012 - 3:00pm.

This article shows the US backing the Syrian rebels.

http://www.ft.com/cms/s/0/94b77724-5cab-11e1-8f1f-00144feabdc0.html#axzz...

While this article shows Russia, China and Iran backing Assad's regime.

http://www.ft.com/intl/cms/s/0/8088bb66-5c18-11e1-bbc4-00144feabdc0.html...

Hope ya'll are getting prepped for some turbulent times!!!???!!!

DaddyO

Silver may be weak...but check out...

Submitted by GoldMania3000 on February 22, 2012 - 3:02pm.

Silver Wheaton. that baby keeps rising. any thoughts on why the disconnect between SLW and silver spot?

SRSroccoSince most nuke

Submitted by zilverreiger on February 22, 2012 - 3:02pm.

SRSrocco

Since most nuke plants are in the northern hemisphere you need to go south, or are you talking about living on a boat?

WTF?

Submitted by GoldMania3000 on February 22, 2012 - 3:04pm.

38.09 0.91(2.45%) 2:03PM EST - Nasdaq Real Time Price

http://l.yimg.com/bm/lib/fi/common/p/d/static/images/2.0.198644/2.0.0/yf...); background-repeat: no-repeat; background-attachment: scroll; -webkit-background-clip: initial; -webkit-background-origin: initial; background-color: transparent; float: left; height: 18px; background-position: 2px 3px; ">Add to Portfolio

Prev Close:	37.18
Open:	37.07
Bid:	37.86 x 100
Ask:	37.87 x 900
1y Target Est:	47.80
Beta:	1.05
Next Earnings Date:	N/A

Day's Range:	37.01 - 38.13
52wk Range:	25.84 - 47.60
Volume:	4,110,635
Avg Vol (3m):	4,732,950
Market Cap:	13.39B
P/E (ttm):	22.38
EPS (ttm):	1.69
Div & Yield:	0.36 (1.00%)

People viewing SLW also viewed:

Thoughts: 1) Sure, 1764 was

Submitted by Dr G on February 22, 2012 - 3:04pm.

Thoughts:

1) Sure, 1764 was passed but it will still have resistance. I wouldn't be surprised to see us under 1764 in a day or two. Nothing wrong with that, it is what it is.

2) Somebody wanted to know what is on the other side of 34.40 (I'm super bullish silver as usual!). I'll tell you what is on the other side. A mess of resistance. Seriously, just a frickin' mess that seems to be every 20-30 cents all the way up through 37. Remember that silver spend mid-October to mid-Novemeber in this same price range. It will be a technical battle.

@GoldMania (really enjoy your

Submitted by Dr G on February 22, 2012 - 3:06pm.

@GoldMania (really enjoy your posts, by the way):

Silver Wheaton. that baby keeps rising. any thoughts on why the disconnect between SLW and silver spot?

Yes, one is a precious metal and the other is a paper stock for a company that mines, among other things, a precious metal. Who knows why stocks do what they do. :)

This google web history thing.

Submitted by Bugzy on February 22, 2012 - 3:07pm.

Been trying to get the pages up as per post. Can someone please provide idiot proof guide.

Ouch!

Submitted by cpnscarlet on February 22, 2012 - 3:07pm.

End of the COMEX must have hurt some folks (poor babies). Does the term "a poke in the eye with a sharp stick" apply?

PS - The correct term is "brakeman", not "breakman". As in "there is no brakeman on this PM train." We can HOPE.

I wonder... if Goaner is

Submitted by Sturdy Fergusov on February 22, 2012 - 3:07pm.

I wonder... if Goaner is right that list of stop orders above $1,760 caused gold to spike to over $1,770 and provided such a strength in the miners (SLW for example) and rising premium in PSLV... what would happen if silver breached $34.40 in the next hour? Quick spike to $35?

Dr.G

Submitted by GoldMania3000 on February 22, 2012 - 3:10pm.

Right back at you dude...right back at you.

Platnium

Submitted by GoldMania3000 on February 22, 2012 - 3:11pm.

Let's look at that chart. dam..rick rule has been saying buy platnium too

Monkeys Must be Busy

Submitted by ReachWest on February 22, 2012 - 3:13pm.

Stepped away to the kitchen for lunch and came back to this current Gold-led price adjustment.

Any further insight as to what may be behind the sudden move? Did one of the Monkeys fall asleep on his keyboard?

YTD relative: 1 week

Submitted by Dr G on February 22, 2012 - 3:15pm.

YTD relative:

1 week relative:

silver spike

Submitted by realitybiter on February 22, 2012 - 3:15pm.

feels like it to me.

slw was $1.5 higher than silver jan 1. Its $5, now. I realize there are a lot of silver sells in here, but when they flush, that gap between the miners and the metal is gonna fall...could be fast. SLW strength should be encouraging to all. Most impressive. Maybe all those asks will soon get cancelled due to noticed strength in miners....10, 9, 8, .......kaboom.

Silver

Submitted by Dr Jerome on February 22, 2012 - 3:15pm.

34.41

This time for sure?

Or are the evil algos set to short it at 34.40?

be careful with silver

Submitted by lairdwd on February 22, 2012 - 3:16pm.

COT says the cartel was short silver, and the price action has been weak. They are keeping silver contained for a raid, while letting gold run.

Remember that gold hasn't

Submitted by Dr G on February 22, 2012 - 3:20pm.

Remember that gold hasn't spent much time above these current 1770 levels during this bull run. A portion of August/Sept last year was it. So, for all intents and purposes we are once again making new highs in gold here. It looks fabulous and lines up with what Turd posted this morning.

Now I've seen it all!

Submitted by Turd Ferguson on February 22, 2012 - 3:22pm.

MODERATOR

Gold SPIKES on no news on The Globex!!
This NEVER happens!!
Is a new paradigm upon us?

Santa and the Angel

Submitted by ReachWest on February 22, 2012 - 3:22pm.

That was Santa's $1764 Angel we just passed through (and in a hurry).

His latest missive about that particular Angel was just yesterday .. http://www.jsmineset.com/2012/02/21/the-golden-angels/

WWWWWHHHHHHEEEEeeeeee!

Submitted by Louie on February 22, 2012 - 3:24pm.

Now keep going up so that Kitco has to change to the $0.50 intervals!

no turd. now you've seen it all:)

Submitted by GoldMania3000 on February 22, 2012 - 3:26pm.

http://www.videobash.com/photo_show/sexy-girl-16561

I sent her out to take down the EE

$1780

Submitted by Irene on February 22, 2012 - 3:28pm.

There it is.

At 1781, no resistance in sight!

Submitted by lairdwd on February 22, 2012 - 3:29pm.

Is the cartel going to let it run right to 1800?

Trading LBMA today over $6k profit so far

Submitted by fast mover on February 22, 2012 - 3:30pm.

I wrote in the last post in response to Turd's CME 3am PM manipulation that my GLS system was ready. Well, it couldn't have been timed better! Up over $6k today and gold is still going higher. Check it out:

http://goldenlightswitch.blogspot.com/2012/02/good-day-to-have-added-2nd...

cheers

Probably a good time to get short silver for a trade

Submitted by lairdwd on February 22, 2012 - 3:33pm.

A $10 selloff in gold to 1770 would probably mean sub 34 silver, given the action today. Risk/reward. Looks like we're starting to see a little pressure at 1780. Let's see if the cartel steps in and puts the hammer down. I think they will, as platinum has stalled.

I CAN FIND NO REASON FOR THIS but i'll take it

Submitted by boatman on February 22, 2012 - 3:36pm.

jump at ONE O'CLOCK????

NO news on seeking alpha news reel

NO econ reports on econ calendar

only thing that lines up is GLOBEX open

1764 a non event ......mystified......

amazing the 4 hat tips to BUSHMAN.........

I HACKED HIM!...........he's really Gartman......or was it jon corzine????

forecasting gold prices is like forecasting the weather....i ought to know i am a meteorologist.

its tough............kinda like forecasting a woman's response to anything.

actually.....GROANER

Submitted by boatman on February 22, 2012 - 3:39pm.

probably COMPLAINED IT UP!

go boy go.........post another manipulation rant....its working

A solid week above $1800 will get me excited

Submitted by Dr Durden on February 22, 2012 - 3:40pm.

Till then, I'd love to see 4-5 days of punching that upper BB out into space.

Keep in mind we've been here before (last November). Major failed move to hold the 61.8% retracement. Plus equities are looking tired and that lovely POSX looks ready to get regain 80.

"thurd is good"

Submitted by thurd aye on February 22, 2012 - 3:45pm.

I thank you for that ;O))

GREEK DEFAULT??

Submitted by tanman on February 22, 2012 - 3:45pm.

Report: Insider Documents Detail a March 23 Greek Default Plan; Gov to Freeze Bank Accounts, Eliminate Euro, Restrict Capital Flow

http://www.shtfplan.com/headline-news/breaking-report-insider-documents-...

"thurd is good"

Submitted by thurd aye on February 22, 2012 - 3:45pm.

duplicate sorry

"thurd is good"

Submitted by thurd aye on February 22, 2012 - 3:45pm.

sod it and that.

Options Expiry

Submitted by sewfarsewgood on February 22, 2012 - 3:45pm.

There not much volume in March Gold, hence the free run today, but watch out next month where the April volume is huge. Silver is the inverse, big volume in March Silver, which expires tomorrow, and the cap remains in place. I'm still betting that March 34 Calls are out of the money tomorrow. Then does the hand brake come off????

GSR Trading

Submitted by question on February 22, 2012 - 3:46pm.

Can use SLV/GLD? (good at least until they fold). If in IRA no taxes or premiums.

Seems to easy; someone disabuse me.

GOLD prediction reality comparison chart and extension to April1

Submitted by ivars on February 22, 2012 - 3:47pm.

Here is gold price reality comparison chart with my earlier predictions (9 month since first prediction on May 5th):

Also deposited here in chart depository:

http://www.tfmetalsreport.com/comment/132166#comment-132166

For longer term trend, the old chart-truth to be revealed in autumn:

http://www.tfmetalsreport.com/comment/83978#comment-83978

Not many other charts have been so lucky so long ( silver, however, has reached 11 month accuracy since March 13, 2011):

http://www.tfmetalsreport.com/comment/79187#comment-79187

Its extension:

http://www.tfmetalsreport.com/comment/78025#comment-78025

Truth revealed in July, 2012.

Could be a Sucker Trap

Submitted by robov on February 22, 2012 - 3:48pm.

Stir some emotion on a pop and get some longs to jump in and then BAM! I'll be cautious especially ahead of expiry tomorrow. JP Morgues has added more than enough new shorts since December to keep a lid on Silver for a little while I would guess. Unless we get get some very bold strong hands ready to take them on and force a possible short squeeze. Then the Crimex steps in to help and cranks up margin again.

2% Cap Rule

Submitted by CBDooper on February 22, 2012 - 3:54pm.

Not sure if this has been brought up previously, but I thought I’d mention it as the current set up in Gold is in line with this theory. One of the theories in the GATA camp is regarding a 2% hard cap on gold implemented by TPTB. Over the course of this bull market, gold has very rarely closed over a 2% gain on a Comex close to Comex close basis. As a way to manage sector excitement, GATA believes that the cartel implements the following strategy:

Day 1 – Gold rises, but is capped at a 2% gain (yesterday)

Day 2 – Gold rises, but is capped at a 1% gain (today)

Day 3 – Gold may fluctuate, but remains basically flat (Thursday?)

Day 4 – Gold goes down, attacked hard (Friday?)

As a long time subscriber to Bill Murphy’s site, I have seen this scenario play out way too many times to ignore. IMO, the silver options expiration may change the timing a bit. Variations I have seen usually happen with the duration of the flat period. If this does play out anywhere close to form, we should get a buying opportunity before weekend.