Chugging Forward

277
Thu, Aug 18, 2011 - 6:55pm

In the commentary this morning, I mentioned how important it was for gold to close today above the highs from Wednesday of last week. It did it! When you consider that today also invalidated the "outside reversal day" that was painted last Thursday, you're left with an extraordinarily strong picture and one where gold is looking to head much higher from here.

That may sound hard to believe. The MSM is full of know-nothings and Disinformation Agents who are working overtime to convince you that gold is in a "bubble" and fraught with risk. This is complete nonsense. Look at the chart below:

This is an orderly progression of eager buyers who are using almost any weakness in price to accumulate positions. I've circled the only time when things got disorderly. The C/C/C brought that to a screeching halt with their margin hike last week. This week, it's right back to the same, steady drumbeat we've been following since early July. So, how far can we go from here? I don't know. In uncharted territory, it's virtually impossible to predict technical resistance. Let's look for two things:

1) Another short term buying climax like we had last week. This will be characterized by similar volatility.

2) Santa's next couple of "angels". The next one is 1849 and the one after that is 1936.

From here, I expect flat to higher gold overnight as global stocks and the ES recover some into the early trading hours tomorrow. However, like last weekend, ask yourself this: Would you rather be long stocks/short gold OR short stocks/long gold over the weekend? Last Friday, stocks were up and gold was down. Tomorrow? Well, I guess we'll see, won't we.

Along those lines, check out this very important chart from Trader Dan. If you think that the current negative correlation between stocks and gold is going to continue, this chart will get your attention and it doesn't even include today's dismal performance.

Last but not least...silver. It also closed above a key technical resistance level today. As you know, a general lack of buyers and open interest has hindered the speed of silver's recovery/advance. Moves like today serve to bring buyers back in, regardless of the extremely high margin rates. I expect silver to continue to trudge forward. It will soon trade toward 41.50 and then 42. How soon it breaks through and closes above $42.30 will determine whether or not I get my $44 by Labor Day. We'll probably need to get through there by this time next week for me to have a shot. Fingers crossed. Either way, silver is looking higher through the northern hemisphere autumn. Sometime in the next 60-90 days it will reach back to the old highs, of that you can be certain.

Have a great evening. Get some rest and be ready for tomorrow. It will be very interesting! TF

9:50pm EDT UPDATE:

​Gold is up $10. The ES is off another 10 points. Crude is down another $1.50. The 10-year note is back under 2%.

A lot can change in the next 12 hours but, at this moment in time, tomorrow looks like it could be a real bloodbath. Not in gold, hopefully not in silver but in just about everything else. It'll be tough to sleep tonight.

The main point of this update is the article linked below. If I had the time or the talent, I'd have written it myself. I agree wholeheartedly with the author's assertions. A must read.

https://www.zerohedge.com/contributed/fed-bombed-market-i-ask-why

See you in the am for an eventful Friday. TF

About the Author

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

  277 Comments

A55H0LE_Lawyer
Aug 18, 2011 - 8:21pm

@PBreed

Yes, I feel much the same. Although I try to marshall my resevoir of everpresent worry to go out and do the things I need to do to prepare for the tsunami.

You don't have to live in a Mad Max world. Go over to the Sovereign Man Confidential group (Simon Black) where they are educating people how to divest themselves of citizenship to become world travelers. It may be bad here, but it likely won't be bad in Singapore and the rising Tigers.

Do we cause the problem by withdrawing money from the system? It's the old spending paradox that Keynes noted seventy years ago. Yes, in a consumer society, when we all save it slows the economy. But I would argue that savings remains good, a national asset. And someone has to have assets when this whole thing crashes down to restart the system.

But all of this has changed me, too. Not necessarily for the better. I used to be an optomist. I'm more reserved as I go about preparing and by necessity cannot discuss with people what I am doing. (If you have a year of food or 1000 ounces of silver, you would be stupid to paint a target on yourself). So I go through this twilight that we're in now--knowing the world is about to change, not particularly wanting to face the hardships to come, but on the other hand HURRY UP ALREADY!!

I try to find something of an outlet in art (my case, photography and music). And my engine remains preparing things for my children to survive & prosper.

Hope that helps a bit. All of us have questioned our sanity from time to time, but the headlines belie the truth. We have the blessing and the curse of vision.

IntuitiveAnalyst
Aug 18, 2011 - 8:22pm

Did Hong Kong just open up?

is 5pm Pacific when the Hong Kong Exchange opens? (8am Hong Kong time?) Gold just spiked from 1825 to 1833 in a hurry.

Canadub
Aug 18, 2011 - 8:25pm

Thoughts for the day... Submitted by pbreed

Good points. I think if your financial position is that you need to budget each month to get by, and your spending everything left over on PM's, be careful you don't forget the value of experiences. You can't sit in your basement in the dark with your tinfoil hat on, waiting for all hell to break loose, and not enjoy life's pleasures as we know them now. You might very well regret it, because when SHTF, things are going to suck! You'll end up sitting on your pile of gold, silver, ammo, and ham :) watching your grass grow every day, shining your shotgun for the 10th time, bored as f*ck, wishing you spent just a little bit of that fiat on a family vacation, or doing that thing you've wanted to do your whole life while you still could have, so you have a little something to remember "the good old days" by. This is the time to do all the things you've ever wanted to do in life! That old "bucket list" will be a lot harder when SHTF!!
Investing in PM's is addictive as f*ck... i CANT stop buying under $40.00!! Im almost glad we cleared it today lol. It's pretty easy to spend every last penny on these shiny little beauties... Just don't get too caught up in it! That being said, be smart about it, have priorities, protect yourselves and the fam first!

RuNuts
Aug 18, 2011 - 8:25pm

History is about to repeat itself

Disturbing images of war.

Video unavailable
GoldenTurds
Aug 18, 2011 - 8:29pm

Feels like Another Gold Margin Hike in.........

3, 2, 1,..................increase margin.

How many days til the next margin hike?

exiledbear
Aug 18, 2011 - 8:29pm

1830

Video unavailable
Vypuero
Aug 18, 2011 - 8:29pm

Asia likes itself some PMs!

Higher in Asian markets

pbreed
Aug 18, 2011 - 8:31pm

Looking forward to Saturday.....

Going to have fun this weekend going out to the FAR site to watch flamey stuff....

The following videos are all my personal u-tube videos....

DeathofACamera
SDSU HArdStart
Free Flight from the Ground

and

ForkliftSmack
beinki
Aug 18, 2011 - 8:34pm
margaritatime
Aug 18, 2011 - 8:42pm

@GoldenT

I think it is based on a % gain over x time... I was just trying to figure it out from historic mh's. It's in the teens.

timpa
Aug 18, 2011 - 8:43pm

National Day of Atonement

"Winston, come into the dining room, it's time to eat," Julia yelled to her husband.
"In a minute, honey, it's a tie score," he answered.
Actually Winston wasn't very interested in the traditional holiday football game between Detroit and Washington .

Ever since the government passed the Civility in Sports Statute of 2017, outlawing tackle football for its "unseemly violence" and the "bad example it sets for the rest of the world", Winston was far less of a football fan than he used to be.

Two-hand touch wasn't nearly as exciting.Yet it wasn't the game that Winston was uninterested in.

It was more the thought of eating another Tofu Turkey . Even though it was the best type of VeggieMeat available after the government revised the American Anti-Obesity Act of 2018, adding fowl to the list of federally-forbidden foods, (which already included potatoes, cranberry sauce, and mincemeat pie), it wasn't anything like real turkey.

And ever since the government officially changed the name of "Thanksgiving Day" to "A National Day of Atonement" in 2020, to officially acknowledge the Pilgrims' historically brutal treatment of Native Americans, the holiday had lost a lot of its luster.

Eating in the dining room was also a bit daunting.
The unearthly gleam of government-mandated fluorescent light bulbs made the Tofu Turkey look even weirder than it actually was, and the room was always cold.

Ever since Congress passed the Power Conservation Act of 2016, mandating all thermostats - which were monitored and controlled by the electric company - be kept at 68 degrees, every room on the north side of the house was barely tolerable throughout the entire winter.

Still, it was good getting together with family. Or at least most of the family.

Winston missed his mother, who passed on in October, when she had used up her legal allotment of life-saving medical treatment.

He had had many heated conversations with the Regional Health Consortium, spawned when the private insurance market finally went bankrupt, and everyone was forced into the government health care program.

And though he demanded she be kept on her treatment, it was a futile effort.

"The RHC's resources are limited", explained the
government bureaucrat Winston spoke with on the phone. "Your mother received all the benefits to which she was entitled. I'm sorry for your loss."

Ed couldn't make it either. He had forgotten to plug in his electric car last night, the only kind available after the Anti-Fossil Fuel Bill of 2021 outlawed the use of the combustion engines - for everyone but government officials.

The fifty mile round trip was about ten miles too far, and Ed didn't want to spend a frosty night on the road somewhere between here and there.

Thankfully, Winston's brother, John, and his wife were flying in.

Winston made sure that the dining room chairs had extra cushions for the occasion.

No one complained more than John about the pain of sitting down so soon after the government-mandated cavity searches at airports, which severely aggravated his hemorrhoids.

Ever since a terrorist successfully smuggled a cavity bomb onto a jetliner, the TSA told Americans the added "inconvenience" was an "absolute necessity" in order to stay "one step ahead of the terrorists."

Winston's own body had grown accustomed to such probing ever since the government expanded their scope to just about anywhere a crowd gathered, via Anti-Profiling Act of 2022.

That law made it a crime to single out any group or individual for "unequal scrutiny," even when probable cause was involved.

Thus, cavity searches at malls, train stations, bus depots, etc., etc., had become almost routine.

Almost.

The Supreme Court is reviewing the statute, but most Americans expect a Court composed of six progressives and three conservatives to leave the law intact.

"A living Constitution is extremely flexible", said the Court's eldest member, Elena Kagan. " Europe has had laws like this one for years. We should learn from their example", she added.

Winston's thoughts turned to his own children.
He got along fairly well with his 12-year-old daughter, Brittany, mostly because she ignored him.
Winston had long ago surrendered to the idea that she could text anyone at any time, even during Atonement Dinner.

Their only real confrontation had occurred when he limited her to 50,000 texts a month, explaining that was all he could afford.

She whined for a week, but got over it.

His 16-year-old son, Jason, was another matter altogether. Perhaps it was the constant bombarding he got in public school that global warming, the bird flu, terrorism, or any of a number of other calamities were "just around the corner", but Jason had developed a kind of nihilistic attitude that ranged between simmering surliness and outright hostility.

It didn't help that Jason had reported his father to the police for smoking a cigarette in the house, an act made criminal by the Smoking Control Statute of 2018, which outlawed smoking anywhere within 500 feet of another human being.

Winston paid the $5,000 fine, which might have been considered excessive before the American dollar became virtually worthless as a result of QE13.

The latest round of quantitative easing the federal government initiated was, once again, to "spur economic growth."

This time, they promised to push unemployment below its years-long rate of 18%, but Winston was not particularly hopeful.

Yet the family had a lot for which to be thankful, Winston thought, before remembering it was a Day of Atonement.

At least, he had his memories.

He felt a twinge of sadness when he realized his children would never know what life was like in the Good Old Days, long before government promises to make life "fair for everyone" realized their full potential.

Winston, like so many of his fellow Americans, never realized how much things could change when they didn't happen all at once, but little by little, so people could get used to them.

He wondered what might have happened if the public had stood up while there was still time, maybe back around 201
1, when all the real nonsense began.

"Maybe we wouldn't be where we are today if we'd just said 'enough is enough' when we had the chance," he thought.


Maybe so, Winston. Maybe so. . . .

Irene
Aug 18, 2011 - 8:44pm

@pbreed

pbreed and other who might be interested,

Stretch your brain in new directions. Instapundit linked to a free AI course offered by Stanford starting in October:

https://spectrum.ieee.org/automaton/robotics/artificial-intelligence/you-you-can-take-stanfords-intro-to-ai-course-next-quarter-for-free

https://www.ai-class.com/

As others on the blog have said, life is a wonder. Get out there and live it. The news will be waiting for you when you come home. And, if you're stacking, you pms will be too!

Shill
Aug 18, 2011 - 8:51pm

Evening Turds. So I am in one

Evening Turds. So I am in one of my evening accounts doing my gig if you will. There are those within the building that are approachable and good people, cross between sheep yet observant so approachable.

I mentioned Gold many moons to some and they brushed it off, and this was well over 7 years ago to the date. Well let me tell you TURDS this was an off the norm round table talk this evening with about 6 people all asking me questions and direction, Really took me off guard to be honest.

I Think I scared most of them lol, but I spoke the truth while I had their attentions. Lets put it this way, we now have 6 new Silver buyers for sure.

I take this way out of the norm approaching as a sign the [pubic] is waking, albeit slowly, but its coming fast.

BagOfGold
Aug 18, 2011 - 8:57pm

Ginger & DPH...

I might as well join in the fun!...Let's see if this one will work!!!...

Lol!!!...It looks like I need more practice!!!... ...

Bag Of Gold

Turdle GG
Aug 18, 2011 - 8:57pm

The $1,849 magnet...

... is pulling

¤
Aug 18, 2011 - 8:58pm

$1840

"Go up, go up, go up ...!"

redwood
Aug 18, 2011 - 9:03pm

Bull markets

Bull markets always try their hardest to bring the least number of people with them. Just read that elsewhere. Sure applies to the miners right now. Hold onto your stocks.

Canadub
Aug 18, 2011 - 9:04pm

Throwing a $1800 party>You're invited! Submitted by DarkPurpleHa

@DPH... ROFL! Ill be the guy with the sh*t eating grin on his face in "bachelorette party" (having made so much fiat, and just left the bullion store).

Jimbio redwood
Aug 18, 2011 - 9:06pm

@redwood

aw man. I bled out pretty bad today. My miners gobbled up all the gains i had in the metals. Convince me to keep them for tomorrow as well.

redwood
Aug 18, 2011 - 9:12pm

Jimbio

Look at this. It might help. I just can't promise for tomorrow, but it's coming.

https://traderdannorcini.blogspot.com/

Shill
Aug 18, 2011 - 9:14pm

redwood

Holding long call options OTM redwood, I am practicing Patience :)

redwood
Aug 18, 2011 - 9:16pm

Another thing

I'm sure you've all noticed the massive runup on the Dow today about 15 minutes before closing, and of course many of the miners. Almost certainly algos at work, but often I've noticed that precedes a good day following. Any thoughts out there?

Chicken Little
Aug 18, 2011 - 9:19pm

Weak Mining Stocks

OK…….That’s it. Enough beach time. Enough hugging kids and wifie. I have tried to stay away from the fray for several weeks, but things sure are getting interesting and I can’t resist the lure of Turdville.

I have some thoughts re: the PM miner weakness. I can’t claim this as original idea ( I think I first heard this on a KWN Metals report from Dan Norcini) but it piqued my interest and I throw it out here for discussion.

The theory is this: The miners are weak because what we are experiencing right now is currency devaluation. There is a race (dollar, euro, pound yuan) to the bottom. The nation that is most successful in devaluing their currency will achieve a huge international trade advantage. As a result TPTB and individuals are attempting to preserve wealth. Historically, wealth preservation is most efficiently achieved through ownership of commodities, and in particular PHYSICAL GOLD, not paper = miners.

This may explain somewhat why gold is leading and silver at this moment anyway is lagging as silver is considered by some to be an industrial commodity and less so a preserver of wealth (relative to gold).

If you look back at the big run up in PM prices during the 70s, the driving force was inflation. Interest rates were 20% on home mortgages during the late 70s. It was during this period of high inflation that the miners exploded. Some silver and gold miners went up several 1000 percent. We are presently in the early stages of the inflation cycle and hence physical gold is the current champ. As we move deeper into the inflation cycle more of the public will want to participate and protect their purchasing power and they will do that by purchasing low cost miners (paper). Gold at $2000 will be out of reach for many.

Patience is the key here. There will be a trigger. At some point the miners will blossom. It might be a merger. Someone might start paying a dividend in the form of metal. Some miner might hit the mother load. Some trip-wire will launch our miners.

You may have read about Golden Phoenix purchasing 500 000 of its own shares and then canceling the shares. What a great way for a company to increase shareholder value. This may be just the start. PM miners are flush with cash and they need to do something with it. A share buyback program would be great.

Anyway, just my thoughts. Hope we can have some discussion. Thanks Turd for the great site and great insight.

Disclosure: Long EXK, GPL, TK, CMA, and WS

Regards,

Chicken

maravich44
Aug 18, 2011 - 9:24pm

Miners HOLD! @redwood

if you are not on margin and do not need the cash. Hold. It will come back to you.

¤
Aug 18, 2011 - 9:24pm

Silver due for a breakout...

...unless the ratio is going to go a lot higher.

Gold gained approx. $35 on the day and silver only about $.35.

That's 100 to 1 if I'm correct albeit one day. And now this move in Au tonight.

Maybe tonight

redwood
Aug 18, 2011 - 9:25pm

Courtesy of dear Santa

My Dear Friends,

Gold’s move to a new high today above $1764 has not happened for technical reasons. There are fundamental problems in the entire Western World Finance that lack solution.

Gold is heading exponentially beyond any expectations of the short of gold share hedge funds.

Weakness in gold shares is manic at this point, and the shorts will not see the top in gold they expected now or for years to come.

Respectfully,
Jim

lostinspace
Aug 18, 2011 - 9:32pm

Screw the Banks

Everythings out... except the $1 i'm leaving in so you fuckwads still have to send me a statement every month.

Banking holiday my ass, 100% physical.

PS-

Felonious Munk Presents: Stop It B! OBAMA PAY YOUR &*%$#% BILLS
tyberious
Aug 18, 2011 - 9:34pm

Great audio

Great audio!

I have heard this theory before, that there is a 40yr cycle based upon ppl having kids, spending patterns and retirement.

I coincides with all of the recession and booms, good stuff, though George Nori isn't that financially knowledgeable.

https://geraldcelentechannel.blogspot.com/2011/08/great-depression-ahead...

Darth Silver
Aug 18, 2011 - 9:40pm

Another revolving door between banks and congress

Ex-Goldman VP changes his name, joins congressional staff and tries to influence banking regulations. This guy deserves a hearty helping of boiled rope:

Quote:

Why did Issa hire a high-level Goldman Sachs executive to work on stopping regulations on banks like Goldman Sachs? Haller’s direct involvement in the July letter brings Issa’s ability to lead the Oversight Committee — charged with conducting investigations on behalf of the public interest — into serious doubt.

https://www.truth-out.org/goldman-sachs-vp-changed-his-name-now-advances...

Turdle GG
Aug 18, 2011 - 9:47pm

Trader Dan's new comments about silver

Silver Stuff

I wanted to post a few comments about the Silver market for some of those who have been asking me to do so. As mentioned in previous posts here, silver is finding itself caught in a war between those running out of risk trades who are selling commodities and equities, and those who are buying it as a safe haven metal.

That tug of war has prevented it from surging alongside of gold but nonetheless, even in the face of such selling, it has been attracting enough buyers that its technical chart picture is slowly but steadily improving.

I want to first note that it has regained its footing above the 50 day moving averaage having bounced firmly off of that key technical level last week. Since then it has established a nice little uptrend which has taken it back to the region where it has encountered selling resistance over the last month or so. I am speaking specifically about the region near and just above the $40 level.

If you will also note, all four of the major moving averages that I use in tracking this market, are now moving higher with the silver price ABOVE those ma's. That is bullish. What I would like to see and what it appears that we are likely to soon get, is for the 10 day moving average (blue line) to move up and crossover the 20 day moving average (red line). That would put the market solidly in an uptrend as it will take some stability at these current price levels for such an event in the moving averages to occur.

If, and this is an important "IF" from a technical perspective, silver can close out the week tomorrow on a firm note, preferably with a push through the $41.30 - $41.50 level, it will enter the following week on very solid technical ground and set up a run to the $44 level for starters.

It still has some downside support first near $39.50 which is followed by another level of support near the $38 level. It would have to breach that latter level for a move towards $35 again.

At some point, as gold continues to move sharply higher, silver will become increasingly attractive to value-based buyers as it is still very affordable if one considers the current options in what can be termed "precious metals", platinum ($1845), palladium( $758), and gold ($1835). None of these metals are cheap any longer ( in the sense that the common man on the street can plunk down some loose change for an ounce) making the little grey metal, "poor man's gold", likely to outperform on a percentage basis in the coming months.


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