Regular visitors to TurdWorld have noticed by now that The Fed has a way of "managing" SPIN and MOPE. For what seems like the umpteenth time, at a critical moment for the dollar, The Fed once again stepped in to create headlines designed to help it catch a bid. Here's a link to their latest:
This, of course, has had the desired effect of turning around The Pig, all at the expense of global equities investors. Since I'm not a global equity investor, all I can do is laugh at the futility of the obtuse algo-gunners, all trying to race each other to the bottom. Scenarios such as this are exactly why you own gold. This scenario is also why gold is not now in a bubble nor is it even close.
1) Fed creates dollar strength. World reacts. Global panic causes a rush to gold. Woohoo!
2) Eventually Fed can no longer prop up pig currency. Pig collapse causes a rush to gold. Woohoo!
Heads we win, tails we win. Just don't let the fool, top-calling douchebags ever scare you out.
The key today will be the highs of last Wednesday evening, the 10th. You probably recall that day. Gold was screaming higher through the pit session and on the Globex. It was rolling another $15 higher in the early evening session when the C/C/C decided to put the breaks on. Gold corrected almost 5% and now is making new highs. Closing today above the 8/10 highs of $1817.60 would significantly bullish.
Silver continues to struggle with the whole "commodity vs currency" thing. Fortunately for us, "currency" is slowly winning the battle. Evidence of this is found in the simple fact that crude and copper are way down today yet silver is actually up about 20c and above the critical 40.40 level. Patience must still be had with silver. Do not expect parabolic-type moves in the immediate future. Do expect, however, a continuation of this uptrend and a move to 42 and then to 44. Like gold, silver's close is very important today. Gold's first, post-S&P peak was on 8/10 but silver's was on the first evening, the 7th, at 40.40. Closing above that level today would be extremely important and significantly bullish. Watch closely and expect some dirty EE tricks as we go through the morning. Here's an updated, 2-hour chart showing the attempted breakout but, also, here's a reprint of a chart from last week showing our short term goal.
OK. I have lasts of 1826 and 40.64. It's going to be a very interesting day. Have fun! TF