The Dog Wags The Tail...Again
Take it as a very good sign that this is happening with increasing frequency.
- As noted last week, the POSX sat at the edge of the precipice, near 79. We all expected efforts to, at once, talk UP the dollar and talk DOWN the euro.
- Today, the man that Goldman placed in Europe, succeeded in talking down the euro.
- The Gold Cartel pounced and initiated a waterfall decline.
- To their collective chagrin, massive allocations of physical were sought at these rigged-lower prices.
- To hedge/cover, The Cartels had to almost as quickly get on the bid in the paper market.
- And you end up with a chart like this:
This is all well and good and clearly benefited us today. However, note that the rally stopped right at the 1685 resistance level that The Cartel has used to cap the market for several days now. As long as it remains profitable to keep the price there in order to fleece the paper longs, 1685 will continue to act as resistance. The hard part is in predicting what happens next.
And next week brings the Chinese New Year (http://www.france24.com/en/20130207-asian-astrologers-warn-stormy-year-snake). If physical demand temporarily slows, then you can rightly expect more downside shenanigans from your friends in New York. If that's the case, look for prices to cling to the blue trendlines on the charts below. Maybe, during the holiday next week, silver sees another drop toward 30.60-30.80? Maybe gold bumps along in the 1660-1670 zone? Again, IF THEY DO, take it as a gift to btfd and stack a little more at the discounted prices. You can bet our Buyers of Size will take them up on it when they return from holiday.
Of course this doesn't mean that prices have to go lower next week. Far from it. In fact, I would imagine that The Cartel actually lost a little money our this morning's trade. They'll be reluctant to try that trick again at these levels so we may very well see gold break $1685 soon (tomorrow?) and head toward $1695, instead. Silver, too, could just as easily break higher and move back toward The Big Test level near $32.50. However, without sustained physical demand, it will be tough to break through so next week is likely still rangebound regardless because of the holiday.
The interesting side note continues to be Sylvia Platinum. Like gold and silver, Sylvia has been rangebound for nearly 16 months. However, just yesterday, she broke UP and out of her range...but just barely. This is akin to gold being a shade above $1800 or silver trading near $36. What will happen next? Can she maintain this level and begin to move higher still? If so, the August 2011 highs above $1900 come into the picture. There is no way that a platinum moving back toward 2011 highs wouldn't provide spillover strength/interest in gold and silver. Therefore, watch ole Sylvia closely in the days ahead.
OK, here are your random items for today. First, Brent at Santiago Capital in SanFran has cranked out another terrific presentation. It deals primarily with fractional reserve banking and is very straightforward and easy to understand. Not only should you watch it but you should forward the link to your friends/family that don't seem to understand the full picture. All you need to do is enter your name and the player begins (I entered "Percival Sweetwater"). http://play.goldmail.com/oali4cua0azc
Also from my inbox is this: This author always notifies me when he posts something and this one is pretty good: http://www.silverseek.com/article/silver-prices-–-big-picture-9511
Many Turdites own/follow Silver Wheaton so I thought I'd pass this one along. Maybe they'll change the name to "Silver&Gold Wheaton"? http://www.forbes.com/sites/kitconews/2013/02/07/silver-wheaton-adds-gold-streams-still-focused-on-silver-ceo/
As if we didn't have enough to worry about, there's this: http://www.independent.co.uk/news/science/a-solar-superstorm-is-coming-and-well-only-get-30minute-warning-8484058.html
And why the hell does the U.S. DHS need 1,600,000,000 rounds of ammo? Are they planning to shoot every U.S. citizen 5 times?? Wait...don't answer that. We need to keep "Main St" on-topic as much as possible. http://www.infowars.com/dhs-purchases-21-6-million-more-rounds-of-ammunition/
That's all for now.