Objectives Met

195
Wed, Aug 3, 2011 - 2:41pm

As you know, I've been looking for a short-term peak in Dec gold, somewhere around 1680. I've also been looking for Sep silver to trade to a peak between 42 and 42.50. You may have noticed that this morning I simply split the difference and called for 42.25. I have intraday highs of $1675.90 in the December gold and $42.06 in the September silver. That's definitely close enough!

It looks to me like The Cartel has had enough for now. Combine that with an overall desire to lock in some gains and you've got a recipe for a small selloff. The Cartel my have tipped their hand a bit by whacking gold for $6 in one minute, just three minutes after the Comex close. It's hard to say for sure but history suggests that they will come back for more later this afternoon and overnight. The key now is to find points where we can buy back in for a short-term trade. The charts below should help.

If you're interested, here's my strategy:

Earlier today, I sold my spreads of Dec 1600 vs Dec 1700 calls. I rolled into new spreads of Dec 1700 vs Dec 1800. I'm still "long" but this freed up quite a bit of cash. I also changed around my silver spreads. You may recall that I was long the Dec 45s and short the Dec 50s against them. Again, to raise some trading cash, I sold my 45s and bought some 48s. So, my new spread is Dec 48 vs Dec 50.

Now, with my liquidity "issue" solved, I'm going to be looking to buy the dip I expect to see between now and this time tomorrow. Even though I expect a "modest positive surprise" in the BLSBS report Friday, I'd still like to do some buying before the report comes out, just in case I'm wrong and the report shows something like -50,000 payrolls! If I get the opportunity, I'd like to buy some October gold calls as well as some September silver. Keep an eye on the numbers I've given you and I'll let you know if I make any moves.

Have a great evening! TF

4:10 EDT UPDATE:

Just wanted to go ahead and get "on the record" here. I do not at all like the unusual action on the Globex this afternoon. The entire thing stinks of an upcoming raid, probably overnight and into tomorrow. Additionally, we know that The Cartel likes to raid the metals on the day before the BLSBS report, too. Combine that with this ugly, 5-minute chart and I think its safe to predict the raid I suspected earlier.

Let's watch and see. I've got a last on Dec gold at 1663. As mentioned above, a preliminary target for a selloff tonight and tomorrow would be 1635-45. Be prepared. TF

About the Author

Founder
turd [at] tfmetalsreport [dot] com ()

  195 Comments

FogHorn LegHorn
Aug 3, 2011 - 9:15pm

pslv premium

I move between cef and pslv as a safe place to park fiat, if some black swan of substance were to occur I'm comfortable that I won't miss the move.The premium is a little high but to buy a share you have to bid enough for somebody to sell you one. Whats the angle of the Sprott bashers?

Turdle GG
Aug 3, 2011 - 9:18pm

@FogHorn Leg Horn

Not a Sprott basher, just want to make sure that we all keep our eyes open and not lose objectivity. Even someone on "our side" is not going to do us favours by ignoring opportunities to profit from illogical market pricing.

Darth Smoker
Aug 3, 2011 - 9:32pm

re: PSLV

Brokerages houses were (and probably still are) soliciting for shares to borrow to sell short. Even with all that PSLV demands a hefty premium.

PSLV vs. SLV does SLV have the Goods???????

¤
Aug 3, 2011 - 9:37pm

Spasms in currencies/low grade war

@Turdle GG just pointed it out.

Now it's the USD momentarily surging against the JPY. Earlier today it was the Swiss Franc CHY having unusual movement upon their intervention. The Euro is always in flux.

The more currency that is generated by all countries, the more it's going to slosh around and clog some economies and markets along the way until they clear their drains and then it's someone else's problem down the pipe. Low grade currency warfare is more like survival of the fittest at this point.

The more they print the worse this is going to get. The FX markets are hiccuping like a fat drunk at a open bar. They get too fat and drunk and it's someone else's problem later on usually.

We all had one of these friends in H.S. or college. Now we have one in our Central Banks.

vamoose1 TF
Aug 3, 2011 - 9:38pm

Yet Another Game?

I put this forward as food for thought. In the last several weeks a curiousity has shown up, not that we needed any more WOPR games from these propellorheads.If i ever met one of these geeks id kick his nuts up through his ears. Assuming....

Many of us are familiar with the other preexisting algo trade, naked short the stocks, long the metals, hence, along with ETFs sucking away buying power, we have this completely paradoxical underperformance in the miners. I am perforce now Olivia Newton John, I got Physical, and incidentally i saw her in concert many years ago, holy jesus. Guys storming the stage.

There is a new algo, Long gold short silver its the only conclusion i can draw from the divergence between the curious short term performance of the two PMs, Gold will shoot up 6 bucks, and silver immediately drops through the floor . Thats the trade being put on.

Conversely, and its been going on all afternoon today for example, Gold gets slammed suddenly, and silver pops, then in both instances both gradually reconverge.

So these inexplicable movements you so accurately identified this afternoon, might just be the machines.Lets see, it might not presage a raid.

Tesla
Aug 3, 2011 - 9:39pm

Dollar Yen Surges Intervention - Ministry Of Finances Sells

Dollar Yen Surges Intervention - Ministry Of Finances Sells Just Under Y500 Billion

Article on ZH

¤
Aug 3, 2011 - 9:45pm

Tomorrow's markets

I'm guessing todays miraculous turnaround from -140 at one point to a +30 in the dow was a sign that tomorrow will be a positive market day. Possibly a big gainer of a day.

I think it will serve the purpose of sucking in any money that saw todays turnaround and tomorrows gain (I presume) by luring some money in on the thinking that the debt deal is done and the Dow has been down mostly and it's due to turnaround etc. Baloney!

If it goes up tomorrow it will be a bullish trap and then the unsuspecting will get slammed on Friday with the NFP numbers.

They need to throw in a good day here and there to suck some people back in. They also need more bad days leading up for the rational for QE3. Tonights currency moves almost guarantee a positive day tomorrow. Friday, not so sure.

¤
Aug 3, 2011 - 9:48pm

Shouldn't PM's be surging a bit....

...if that much of a JPY intervention took place?

A little fuzzy on the FX interactions and reactions on such a huge scale.

Turdle GG
Aug 3, 2011 - 9:51pm

Bored?

if anyone really wants to follow Asian market action in real time (though I certainly don't recommend it...), Bloomberg Asia stream is here:

https://www.bloomberg.com/tv/

Turdle GG
Aug 3, 2011 - 9:55pm

@DPH

JPY is only a small part of USDX:

So, the 1.7% gain in USD vs. JPY won't impact USDX much. EUR is the one to watch, given its weighting.

So, purely from a dollar vs. PMs perspective, this currency intervention is likely to have little effect on PMs.

From a broader perspective (i.e. that all countries are trying to weaken their currencies) then it's further proof of the value of PMs.

Rui
Aug 3, 2011 - 9:59pm

No big player wanna break COMEX

My 2Cs on "breaking COMEX". Put me in Sprott's shoes I'd skip COMEX as well. If you really look into it you'd see why none of the three big players at COMEX - EE, big hedgy speculators and big investors - wanna bust COMEX.

EE of course does not want their shorts to burn so they want COMEX to go on.

Big specs are after the paper profit only. They are not interested in taking delivery so they take whatever paper profit they can get and come back next month to try again so they too want it to go on.

Big investors want metals and are fully aware of COMEX being an empty vault full of paper claims rather than PHYZS so they too have no interest getting the metals from COMEX. They skip the metal exchanges and deal directly with the mining companies. That's how they accumulate the PHYZS, and that physical buying is what will eventually render COMEX paper games irrelevant.

Dr G ¤
Aug 3, 2011 - 10:09pm

@DPH

re tomorrow's markets. They may be up. Wouldn't surprise me. We are guaranteed that the jobs data on Friday will be piss poor, so the markets will tank on Friday. With that said, PMs would traditionally be manipulated down tomorrow prior to a nice pop on Friday.

Dr G Turdle GG
Aug 3, 2011 - 10:10pm

@Turdle

what about the Swiss Franc? I'm on my iPad and can't pull up any charts right now. CHF is crazy strong, so gold may be falling in Francs.

Turdle GG
Aug 3, 2011 - 10:13pm

@Dr G

Looks like the Swiss Franc selling / USD buying by Switzerland worked, then reversed, and is now working again. USD/CHF ust moved from near 0.770 to 0.775. Moved at the same time as the JPY, though no news out yet as to whether the Swiss actually intervened or whether the move was merely market reaction to the move by Japan

ewc58
Aug 3, 2011 - 10:18pm

Joe Lieberman Vs. the truth about Social Security

This piece is classic slimeball Joe. The Elmer Fudd of mass murder. First, here's Lyin' Joe:

Lieberman Says We Need To Cut Social Security To Pay For Defense

And now here's the truth. Compare the 2 stories to get a full sense of Joe's treachery. At least Shrub just came out and told us he was gonna screw us. All Joe has ever done is screw us. But this creep but wants to sound like it's his patriotic duty.

"...Since the Greenspan Commission in the early 1980s, Social Security has cumulatively collected far more in payroll taxes dedicated to the program than it has paid out to recipients—nearly $2.4 trillion by 2008. This annual surplus is credited to Social Security trust funds that hold special non-marketable Treasury securities, and this surplus amount is commonly referred to as the “Social Security Trust Fund“. The proceeds are paid into the U.S. Treasury where they may be used for other government purposes.”

And this is what they are trying to eliminate:

  • Because of the mandatory nature of the program and large accumulated surplus in the Social Security Trust Fund, the Social Security system has the legal authority to compel the government to borrow to pay all promised benefits through 2037, when the Trust Fund is expected to be exhausted. Thereafter, the program under current law will pay approximately 75%-78% of promised benefits for the remainder of the century.[37]

This is what the District of Criminals is trying to eliminate, the calling in of all the monies stolen from Social Security, due and payable to the investors in Social Security; the working class. Should the fund actually ever incur a shortage, the Social Security Administration could lawfully force the federal government to borrow money to cover the theft and to restore the 2.7 trillion stolen so far from the fund."

https://ppjg.wordpress.com/2011/08/02/why-the-district-of-criminals-is-desperate-to-kill-social-security/

vamoose1 Turdle GG
Aug 3, 2011 - 10:18pm

Please pay attention

I know eric sprott, decades, he is incontestably honest, any shares he sells get immediately rolled back into physical silver and some into shares, but he trades FLAT. Get it? And picks up 20 percent on the way through, replaces the sale with Royal Canadian Mint bars, takes delivery and drives on.

Then why this ridiculous 20 percent premium. It makes no sense whatsoever, Central Fund is Pure metal too, provides the same geographical Canadian diversification, albeit its both metals, and trades right at asset value. Or either side. No material premium.

Now please listen, because this gets wild. PSLV should never have been approved, some summer student at SEC, is wearing heavy footwear in the potomac for approving that prospectus, even these criminals make errors. They thought he was some mickey mouse Canadian, crossed out the word gold from his physical Gold issue earlier in the year, annd substituted the word.Silver, well, the physical gold issue did nothing to the gold price , so why should this. BIG MISTAKE.

The issue went out the window for 580 million. Mammoth for silver. Gold by contrast absorbed his prior physical gold issue easily. He stood for physical silver delivery in November 2010 And said lets rock, i should have it in a week. . Guess what. THERE WASN"T ANY.

The deliveries were completed in late February 2011,....many of the bars were so new they POSTDATED THE FALL ISSUE. Some were still warm from the fucking refinery.

Now, be Blythe Masters , the cunt from JPM. By wiping out the almost nonexistent physical overhead silver supplies silver took an immediate rocket ride from 20 to 50, AND THIS IS WHY, it amounted to a perfectly legal but incredibly clever quasi silver corner. The 100 to 1 paper silver game had its pants pulled down.

Ok JPM probably got nailed for 25 billion dollars, which is why the intern who approved that Prospectus at SEC went for a long swim.

Well God help us, what if he come South AGAIN god forbid and does another 500 million followup issue under this PREAPPROVED Prospectus, he could gun silver to triple digits.

If You were JPM , and had as a corporate mantra that you manipulate markets, you say Jesus we cannot permit that. That could clobber us for another 20 billion.

BUT HOW ABOUT THIS........... instead of manipulating from the SELL SIDE as per usual, lets manipulate from the buy side, and jam this thing PSLV to a 20 percent premium. And keep it there. That hamstrings Sprott, he can hardly do an issue 20 percent above intrinsic value, nobody would touch it he is cooked. So it costs JPM 500 million to eat PSLV , well, thats chickenshit beside 40 billion.

Nobody will ever again clear a physical silver prospectus in the United States from now to either eternity, or until JPM has got themselves heavily net long.

Its quite a game this.......... such nice people, and the Mayday sunday night silver massacre, wouldnt have had anything to do with this??? NAH.

Shill
Aug 3, 2011 - 10:20pm
Turdle GG
Aug 3, 2011 - 10:22pm

@vamoose1

Thank you vamoose. Very helpful.

One question: if retail buyers are happy to pay 20% premium to buy PSLV existing shares, why would they not pay 20% premium to buy a follow-on offering?

¤
Aug 3, 2011 - 10:30pm

@Turdle GG

Your right. I didn't take into account the weighting.

I did just look at the kitco charts and there was a definite hiccup that happened after I typed that a while back. The PM's settled back down for now.

~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~

The one thing that ZH brought up again recently was the huge potential liability that France faces with all of it's investments in Italy, Spain etc. Britain is in the same boat also. That's probably why both of those countries are in Libya. They both have a lot to lose and maybe Libya going astray (and all of those petro-dollars) would have put those two countries banking systems belly up. I fear that's what might happen due to Italy and Spain getting hit hard in the bond market lately. If France and England get smashed hard and their banks start to teeter (again) then our Fed will bail them out (again).

I strayed off topic as I usually do. But the reoccurring theme is way too much currency in the system in some parts of the world and not enough in other parts where the economies are pretty significant. I think Italy and Spain are in the top 10 if I'm not mistaken. If they tank, France and England tank, and the Euro plummets and the Swiss Franc goes through the roof as well as the USD, JPY etc. and the whole FX market seizes up for the most part.(really bad thought)

Were at a tipping point in the currency markets I think. Way too much in some places and not nearly enough in other significant sized markets that have large, impactful economies.

To say it's getting interesting would be a understatement. Were seeing crazy swings in all the markets on a daily basis for the most part. "We ain't seem nothing yet" seems about right.

And the market will probably go up inspite of it all. Go figure.

vamoose1 Turdle GG
Aug 3, 2011 - 10:41pm

Answer

Because they could go to a coin dealer and buy the physical at intrinsic value, yes , its a bit inconvenient, but would you pay 52 for silver today?

treefrog
Aug 3, 2011 - 10:46pm

shill,

that train is moving opposite the direction of the river (good sized river for the semi-arid west) flowing in the foreground. it's in oregon. that means it's moving away from the pacific. (eastward) hardware coming back from the middle east? korea? other? wtf? over.

murphy
Aug 3, 2011 - 10:48pm
Turdle GG
Aug 3, 2011 - 10:57pm

@vamoose1

Thanks, but that assumes that it's only JPM that buys PSLV on market at its current high price. But that's your whole point, isn't it?

Shill
Aug 3, 2011 - 10:58pm

Moody's Investors Service said it may cut its ratings on Bank of

https://www.cnbc.com/id/44006718

Moody's Investors Service said it may cut its ratings on Bank of New York Mellon and JPMorgan Chase over the next 18 months, saying the banks might get less U.S. government support in the future.

Shill
Aug 3, 2011 - 11:00pm

Moody's Investors Service said it may cut its ratings on Bank of

https://www.cnbc.com/id/44006718

Moody's Investors Service said it may cut its ratings on Bank of New York Mellon and JPMorgan Chase over the next 18 months, saying the banks might get less U.S. government support in the future.

US borrowing tops 100% of GDP: Treasury

https://news.yahoo.com/us-aaa-rating-still-under-threat-204040123.html

Turdle GG
Aug 3, 2011 - 11:19pm

$42 again

How high can we go before the pre-payrolls slap down?

silvermedusa
Aug 3, 2011 - 11:43pm

Good Question Turdle

Maybe we won't get a slap down? A lot of $$ went into repumping stocks, maybe no firepower to fight g n s for now. I was hoping tomorrow might be a good day to buy, but, dang, just my luck they won't slap it down. OTOH, they can smack it down a buck fiddy in a bat of an eye. Will be interesting to see. Hard to predict anything anymore, reason I luv the Turd!

vamoose1 Turdle GG
Aug 3, 2011 - 11:46pm

retail buyers

Fair question, and this is just one humble persons opinion ok , i would think very few do, when that premium gapped i sold my PSLV and bot bars. JPMORGan is the principal buyer, they can place orders in 200 places to create the illusion of a real market, butits really just them.

We have a very serious adversary here, JPM manages the silver market as US government policy to discourage people from abandoning the currency.

There is a great interview with Sprott up the board here, one fine day the 27 million ounces on Comex get stood for, soon abd if this thing ever crosses 50, i call it AREA 51, you will have to lie down with sedatives or powerful illicit drugs. It might be 60 in a day.

I told eric sprott, dont go to the us, i wasnt entirely joking, he blew the scam apart, aspects of this can be dangerous, ask andrew mcguire.

TheGoodDoctor
Aug 3, 2011 - 11:48pm

If I could find a decent

If I could find a decent version of the Jefferson's theme song I would post it. YouTube! doesn't have it. Or at least the beginning version.

Prize Fighter
Aug 4, 2011 - 12:01am

You guys were talking

You guys were talking Yen....

More On The 2011 Edition Of US-Japan Open Currency Warfare: "This Is Just The Beginning"

I don't really know what all this means but this stuff makes me nervous. Most of it is over my head quite honestly, but like all of you I have a grasp on the fundamentals. I do know most people will have all the wrong ideas as to why all this happened. They won't listen now, they won't listen then. Can't talk reason with hot, angry and stupid. I guess that's why we have all the cool toys. I think by $100 silver this world is going to be ca razy.

Good luck out there.

Contribute

Donate Shop

Get Your Subscriber Benefits

Exclusive discount for silver purchases, and a private iTunes feed for TF Metals Report podcasts!

Key Economic Events Week of 4/22

4/22 10:00 ET Existing Home Sales
4/23 10:00 ET New Home Sales
4/25 8:30 ET Durable Goods
4/26 8:30 ET Q1 GDP first guess

Key Economic Events Week of 4/15

4/16 9:15 ET Cap Util and Ind Prod
4/17 8:30 ET Trade Deficit (Feb)
4/17 10:00 ET Wholesale Inventories
4/18 8:30 ET Retail Sales (March)
4/18 8:30 ET Philly Fed
4/18 10:00 ET Business Inventories (Feb)
4/19 8:30 ET Housing Starts and Building Permits

Key Economic Events Week of 4/1

4/1 8:30 ET Retail Sales (Feb)
4/1 9:45 ET Markit & ISM Manu PMIs
4/1 10:00 ET Construction Spending (Feb)
4/1 10:00 ET Business Inventories (Jan)
4/2 8:30 ET Durable Goods (Feb)
4/3 9:45 ET Markit & ISM Services PMIs
4/5 8:30 ET BLSBS

Recent Comments

by Marchas45, Apr 23, 2019 - 7:22pm
by dangerkitty, Apr 23, 2019 - 6:28pm
by mike97, Apr 23, 2019 - 6:15pm
by LP, Apr 23, 2019 - 6:03pm
by NW VIEW, Apr 23, 2019 - 5:55pm
randomness