Max Q

308
Tue, Sep 27, 2011 - 7:00pm

Whoever told you that trading and stacking precious metals "wasn't rocket science" was lying. When watching the video below, be sure to note what happens at the 0:55 and 1:15 marks.

STS-133 Space Shuttle Launch

After a decline of epic and historic proportions, the PM charts tonight stand just below their points of Max Q. "Huh?", you ask. From Wikipedia:

"In aerospace engineering, the maximum dynamic pressure, often referred to as maximum Q or max Q, is the point at which aerodynamic stress on a vehicle in atmospheric flight is maximized. There will always be a point where the dynamic pressure is maximum. That point is max Q.
In other words, below max Q, the effect of the vehicle acceleration overcomes the decrease in air density so as to create more dynamic pressure (opposing kinetic energy) acting on the craft. Above max Q, the opposite is true. The dynamic pressure acting against the craft decreases as the air density decreases, ultimately reaching 0 when the air density becomes zero.
During a normal Space Shuttle launch, for example, max Q occurred at an altitude of approximately 11 km (35,000 ft).[1] The three Space Shuttle main engines were throttled back to about 70% of their rated thrust as the dynamic pressure approached max Q;[2] combined with the unthrottled solid rocket boosters, this reduced the total thrust by about 5%.
During a typical Apollo mission, max Q occurred between 13 and 14 km of altitude (43,000–46,000 ft).[3][4]
The point of max Q is a key milestone during a rocket launch, as it is the point at which the airframe undergoes maximum mechanical stress."

Got it? Me, neither. But that's not the point. In our example here, the PMs have rallied from deeply oversold territory. This part of the flight (the liftoff) was easy. Just light the fire and watch it go. However, any rally after such a steep selloff is inevitably going to reach a critical point on the charts where the rally either reaches escape velocity and continues on OR the gravity of the selling pressure becomes too great to overcome and things head back down. This is area on the charts is our Max Q. This is our point of maximum dynamic pressure.

On the charts below, I've outlined the clear areas of Max Q. In gold, it's 1670-1682 with a continuance of pressure all the way to 1705. In silver, it's the area between 32.35 and 33.85.

The thrill ride of the liftoff is over and the engines have been throttled back. We've reached the point of Max Q. Will we be able to clear Max Q? Will we hear the command "Go For Throttle Up" and continue the rally or will our mission end with a diversion to Diego Garcia? (Trust me. No one wants to be diverted to Diego Garcia.) We should have the answers to these questions very soon.

Here's some extra stuff to help you pass the time while you wait. First up, Eric King interviewed John Embry of Sprott Asset Management late yesterday and the entire interview can be found through the link below. It's brief but quite interesting. Equally interesting, in light if the beating it took today, is the intro ad for Santa's stock.

https://www.kingworldnews.com/kingworldnews/Broadcast/Entries/2011/9/26_John_Embry.html

Next, Jeff Nielson has penned another interesting article:

https://www.bullionbullscanada.com/index.php?option=com_content&view=article&id=22271:precious-metals-vs-us-treasuries&catid=48:gold-commentary&Itemid=131

This "Silver Summit" sure looks like fun. I can't attend but perhaps one of you would like to go and report back for all of us?

https://cambridgehouse.com/conference-details/the-silver-summit-2011/48

Lastly, the article below was brought to my attention this morning. I must admit that it is somewhat challenging to get your arms around but it is worth the time and effort to try. For me, the collapsing lease rates for gold are a clear and obvious signal of massive, direct Central Bank intervention in the gold markets. As the article states, without this intervention, gold would be in backwardation due to extremely high physical demand and, as you know, backwardation is a sure sign of an impending short squeeze. Of course, I could be wrong so I'm interested to hear everyone else's interpretation.

https://ftalphaville.ft.com/blog/2011/09/14/677021/why-gold-forward-rate-inversion-is-important/

Also note that the article was written on 9/14, fully one week before the latest massive beatdown. Hmmm. It would sure seem that someone or something leased a boatload of gold at extremely cheap rates to overwhelm the market and set prices tumbling. Was Wednesday night into Monday morning just a continuation of the central bank intervention we first noticed three weeks ago after the SNB devaluation of the franc?

OK, that's all for today. TF out.

9:00 am EDT UPDATE:

I don't a lot to add this morning other than to point out that the overnight spikes died as price entered the MaxQ zone and as the LBMA opened. That certainly shouldn't surprise anyone.

For today, watch the lows from before the spike. Those levels are around $30.75 in the Dec silver and $1635 or so in the Dec gold. Let's look (hope) for some support there should selling intensify.

Believe me now and hear me later, you should definitely take time to read this:

https://www.zerohedge.com/news/step-aside-bbc-trader-head-unicredit-securities-predicts-imminent-end-eurozone-and-global-finan

Perhaps, though, you should watch this first. It might help with the Hungarian translation:

https://www.hulu.com/watch/276401/saturday-night-live-hans-and-franz

TF

About the Author

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turd [at] tfmetalsreport [dot] com ()

  308 Comments

Justin
Sep 27, 2011 - 9:49pm

@#$% Diego Garcia

I was unlucky enough to be forced into a squadron there when I was in the Navy and then lucky enough to receive an order mod back to Oceana 3 weeks after arriving there. Great place if you enjoy feeling confined and aren't worried about anything other than drinking yourself into a drunken stupor every day after work to forget that you're on a horseshoe in the middle of massive amounts of H2O, only to repeat the process the very next day.

Thanks for the links, Turd. I was reading an article earlier today of which the focus of was the change in silver lease rates changing just before the smack down and I am looking forward to reading another perspective on that. One thing can definitely be said of the metals game and that is the fact that too much information will never be enough information.

Growing up just outside of Cape Canaveral, I can appreciate the video as well. Seeing a launch on video is one thing, but nothing will ever compare to the raw power and force experienced in person as a shuttle thunders into the atmosphere!! Sadly, that is stuff for history textbooks now. Apparently whatever reason we had for going into space has now concluded, and I hate to sound conspiratorish, but I doubt we were up there spending billions of dollars to conduct "science experiments."

Silver related note, we just dropped a decent amount after failing support at the 38% retracement level. Guess a "v" shaped recovery just wasn't in the books this time, but I'd feel more confident in putting my bull hat back on with a double bottom under our belts.

Tip of the big, yellow hat to you for tonights post.

bensgone
Sep 27, 2011 - 9:49pm

One more reason silver will not go to $20.

Position Limits Oct 18th. Delayed again. Most likely will be delayed on Oct 13, for another 34 years or until JPM has covered.

https://silvergoldsilver.blogspot.com/2011/09/position-limits-oct-18th-delayed-again.html

Another reason silver will not go to 20 !! Now, that this is out of the way. I didn't think anything would come of this, just more crap to get up our hopes, only to be dashed, the CFTC is just one more criminal organization and you can't believe a damn thing they say. Look how long poor Ted Butler was led on by these crooks. Even Bart Chilton shut his mouth !

redwood
Sep 27, 2011 - 9:56pm

Yes, and their aim eventually

Yes, and their aim eventually is to shut everyone's mouth. We better talk fast until they "regulate" the internet.

¤
Sep 27, 2011 - 10:00pm
TruthPreeminent
Sep 27, 2011 - 10:11pm

@benroberts

First of all, I am not predicting silver will go to 20. I am preparing for it in case it does. But you contradict yourself. You say that silver should rise and we have the wind at our backs because of the Fall months. This is contradicted by a move from 44 down to 26. We have wind alright, but it's a tornado that just leveled our longs in silver. How you can be so sure there won't be anymore intervention is beyond me. If I would have told you that when silver was at $44 that it was going to $26 you would have said I was crazy. I posted that I thought the 100DMA at 38.80 would hold. I thought we were going up. I have reconsidered things. Let's make it simple. I think we see 26 before we see 40. What do you and the others who disagree with me think? I had no idea I would receive so much attention for my preparation. I'm not predicting 21. Just like Turd was not predicting 23.40. Did you guys give him any grief for tha? If not, why not? It's only a few points from my "preparation" point. Look, I simply think that we will go back down, and perhaps go back down significantly. I think we see the twenties before we see 40. What do you think?

UncleFester
Sep 27, 2011 - 10:14pm

benroberts

Why worry about position limits and margins? You will get the physical price, but you may not like what the rest of the world looks like. You will get the physical price through these mechanisms not in spite of them!

IFester

TruthPreeminent
Sep 27, 2011 - 10:29pm

@redwood

I agree that we are in stage 2 for gold. But global physical demand has not as much to do with the "real" price of silver and gold as does the paper that is traded. The physical demand is robust as evidenced on all the dips and smashdowns. But the paper trading is what is dictating the price, not physical demand. I think if a Lehman event happens then people will run to the dollar like they just did. This is where I fundamentally disagree with you and ScottJ and others. It is just pure psychology. I think people run to what they are used to not what they will in the future when there is hyperinflation. The world is sleeping in paradigm 1 while you and I are already in paradigm 2. Yes, this is beginning to change rapidly, but we are not there yet. Thanks for your post. BTW= I think there is a chance that silver (which just entered stage 2 perhaps last Fall) will just go right into stage 3 if they continue smashing the price.

awninja47
Sep 27, 2011 - 10:33pm

Diego Garcia

Come on guys, Diego isn't THAT bad. What's wrong with drinking yourself into a drunken stupor at the beach day after day?

survivalwstyle
Sep 27, 2011 - 10:36pm

so there was this thing on waLL strEEt sunday

i am stiLL watching these videos and it just is geTTing worse. i have not sEEn drudge have it and think it was 1 and done over @ zerohedge. scratching my head. this is not right friends. from everything i have sEEn, it was the cops that made this ugly. what is wrong w/ a few thousand hanging round waLL st. on a sunday. they were not reaLLy bothering anybody. yet i have sEEn a girl get maced in the eye from a cop in a white shirt, who just walked up sprayed her face and walked away. then this guy who piSSed oFF the wrong cops with his caLL of "is that what you're about!"

UNEDITED - COP KNEE ON THROAT 9/24/2011 #OCCUPYWALLSTREET
Video unavailable
Cucamonga
Sep 27, 2011 - 10:38pm

China Doll

Grateful Dead Perform "China Doll" -Shoreline- 6/16/90
Shill
Sep 27, 2011 - 10:38pm
ewc58
Sep 27, 2011 - 10:42pm

Hazey: thanks for the link

Justin, don't worry, we are in space in a big way. In ways even fewer people would believe than those who can handle PM market manipulation.

NASA and the stuff at Kennedy was just old tech/low-tech, loud-ass combustion based eye candy, set out there for the benefit of the proles. There were actually 2 Disneyworlds in central FL, in close proximity to one another. Distractions while the real action was happening elsewhere. Basic sleight of hand.

Let's just say that US Space Command isn't exactly spending their time tracking a bunch of orbiting junk. What many people have seen when turning latest generation night vision gear to the sky is... well... inexplicable really. Among many others, see Ed Grimsley's YT page to see what I mean. All i can say? Don't scoff until you watch a couple. Go ahead and try to explain that friends. Like i say: inexplicable, at least when using conventional parameters of reality.

Now don't get me wrong, I'm not a "ufo" guy. I don't believe in Grays, Dracos, Plaeidians or any of that stuff. I am, however, a huge believer in occult (hidden) ultra-high technology, produced under Ultra-Black programs funded by unlimited and totally undisclosed budgets. I think it most likely that something game-changing and beyond top secret came out of all the missing Defense budget trillions Don Rumsfeld once told us about. On September 10, 2001.

Prometheus. TR3b. TR4. Haunebu. Go ahead, check 'em out... And realize this: some of the German Operation Paperclip scientists brought to the USA at the end of WWII were the same ones who developed the Haunebu disc for the Third Reich. It utilized anti-gravitics to fly. This in turn was an outgrowth of the "Nazi Bell" research and the resulting crazy-advanced technology that author Joseph Farrell has done such eye-opening work on.

Given brand new research facilities out West, huge R&D budgets, and 20 years of onward development, is it so hard to think that what Ed Grimsley is capturing is actually the fruit of their labors and all that dough? After all, they don't call it the Skunk Works for nothing. Because something's sure fishy in Denmark alright. Bizarro world for sure.

redwood
Sep 27, 2011 - 10:42pm

Truth, thanks for your post. 

Truth, thanks for your post. I will reflect on that...you may be right.

TruthPreeminent
Sep 27, 2011 - 10:58pm

@redwood

You bet. Have a good night!

Rich MyGold
Sep 27, 2011 - 11:11pm

Interesting times to be living in

US Mint Suspends Numismatic American Silver Eagles and ATB 5 Oz Coins -> Customers visiting the Mint’s online store will see a message of "This product is temporarily unavailable for product repricing" on eight product pages...that's just great!

nfl
Sep 27, 2011 - 11:14pm

I'm just glad range safety

I'm just glad range safety didn't punch the Flight Termination System button Sunday night. And disappointed we couldn't hold 32 today. Need some overnight action to get Silver higher soon.

Golden Turtle
Sep 27, 2011 - 11:17pm

We are currently in the fight of our lives - RIGHT NOW

Looks to me like gold and silver are about to tank.

Unless we get a major push upwards, we could be seeing 1500 gold and 25 silver quickly.

Very unfortunate, but make up your own minds.

They are pulling in the last few suckers, before we go much lower.

Short term bearish chart:

Longer term bearish chart:

Dr Durden
Sep 27, 2011 - 11:20pm

I can't tell

If the volatility right now will shake the ground so badly that everything will fall on it's ass...like really fall on it's ass, hard! Or will it excite those extremely undervalued assets to no end and send them soaring like the Shuttle.

Confusion.

Gambling.

Fun.

I need a cocktail...

Mudsharkbytes
Sep 27, 2011 - 11:22pm

BrotherJohnF drops a comment at the end of this video…

The latest commentary from BrotherJohnF was posted here yesterday.

Silver Update 9/26/11 - Hidden Bottoms

What surprises me is, at the end of this video he states his projection for silver at the end of the year is STILL $100.00.

This seems totally unrealistic to me, but so far this guy has been pretty durned accurate. He called the sell-off several days before it happened and even came pretty close to pegging what the bottom would be.

Wishful thinking perhaps?

exiledbear
Sep 27, 2011 - 11:23pm

The spread is widening

$1638 spot - that's over $200 in a few hours...

blknblu1 WineGuy
Sep 27, 2011 - 11:24pm

TFSA

In response to wineguy:

I feel your pain, however, a suggestion.

Now would be an optimal time to roll out of your RRSP and into a TFSA (Tax Free Savings Account). The tax hit is minimal, and if you haven't started a TFSA already you will have enough contribution room to put it all there. You don't even have to sell the shares, they do a de-registration, hold back a small amount by selling a little bit, and it goes directly into your TFSA. You get a tax slip at the end of the year, and your investement is then sheltered from tax. I just helped a family member do this very thing. Please, forgive me if it don't have the exact wording.

Any capital gains in an RRSP is taxable as income upon withdrawl. Great for the gov't. I've always looked at RRSP's as the gov'ts way of insuring a future income for themselves. The tax-break is short-sighted when looking at the gains you intend to make and the tax you would have to pay then. The big chunk of change doesn't look so big once they get their hooks into it.

Gains in TFSA's are tax-free. Few people seem to know about this, or take advantage of it. If you feel an investment has a chance of being a home run, why pay the gov't your profits as income when you can pay them nothing at all?

Let's say you've go a 10 bagger you've bought before it runs.... all the gains within the TFSA are non-taxable. There is always rule changes to consider... same can be said about RRSP's.

Just throwing that out there.

Number 47 ¤
Sep 27, 2011 - 11:24pm

@ DPH

Britain provided the time, Russia provided the blood and America provided the money.

The thing I realise about WW2 now is that Britain was no better than the Nazis. (I hold a British passport) Politically, Hitler was an upstart against British domination. he had to be put to rest. The British empire has many dark days, massacres, domination of peoples and crimes against humanity that are conveniently swept under the collective rugs of history. We always come up smelling of roses.

Just like the expansion of the American empire we see today.

https://www.independent.co.uk/news/world/middle-east/toxic-legacy-of-us-...

https://en.wikipedia.org/wiki/Blackwater_Baghdad_shootings

Next will be China. When they move into south east asia after cutting off their water supplies.

https://www.japanfocus.org/-Milton-Osborne/2448

https://en.wikipedia.org/wiki/Chinese_water_crisis

I'm of a different ilk to these people. Historical and future. I'm yet to find my place in the world. I buy PMs for protection not from economics but from war. I am a believer in the SHTF, the S has already HTF and history will show the war started well before this date. I'm a stacker to get on the boat, to cross the border and to get the extra rations.

There will be no mad max. just the usual slaughter of those who blindly follow their leaders into the valley of death.

Meek and obedient we follow the leader down well trodden corridors...........

I'm going to start a thread in the forums one of these days, one that explores the geopolitical fallout we can expect from the situation we find ourselves in. You seem to know your history, I hope you will join.

edit to add.

Thread started. It's late here and I had a few drinks but the general gist is in place. I hope some will join in. ' The end of the great keynesian experiment' will not be trading, stacking or hoarding canned hams. It will be the usual patriotic march to carnage. Let's try to shed some light over the coming dark days.

https://www.tfmetalsreport.com/forum/2523/prepping-war

exiledbear
Sep 27, 2011 - 11:26pm

Maybe it's because all gold futures traders are Mexican spread

You know, short 1 contract of gold, and long 1 plane ticket to Mexico...

Velocity
Sep 27, 2011 - 11:26pm

It's On, it's Off, On, Off, On...

...Off.... this European 'Stability' hahahahahahahahaha Fund (sorry uncontrolled Fraudian slip/laugh there at the word 'stability' in Europe!) looks like it's 'Off' from the latest I've read on ZH

the German politicians are increasingly annoyed and vocal (and pissing their pants behind the scenes at voters venting big anti-Euro sentiment), the Greeks are pissing about (what's new?) revising their demands up (what's new?) by a 'paltry' €60bn in 2 months (hell why not eh?) and a German Judge has just ruled, not at all insignificantly, that Germany needs a whole new friggin Constitution and to vote on any future Euro-bailouts (bottleneck ahead).

By the time that lot of colossal judicial gubbins gets through The Fatherlands houses Greece will be so far gone the yoghurt will only be good for paving your drive!

Implication: the European stock markets are going to tank tomorrow/real soon, cue liquidation, cue possible another fall in the PM's for the time being.

Don't panic, when everyone around is losing their heads PM's will probably gain even more momentum once everyone returns from their bomb shelters.. we're used to that in Europe and smiling and joking while wearing hard hats ...which you need in PM's with all the fukers in Central Banks and Blankfein & Dimons walking dead operations firing Howitzers every few months!!

cpnscarlet exiledbear
Sep 27, 2011 - 11:33pm

@exiledbear - And I thought

@exiledbear - And I thought that UFO YT page was strange - this can't be right. after the last six calendar days, you are still seeing 1800+ prices on EBay? That has got to be for some numismatic stuff - 70 grades and the like. Are you SURE these are just plain old Eagles, ML, Phils and such??

I SO want to believe this disconnect, but just can't wrap my head around the possibility. Can you please give us some more updates. If this is still happening on 30 Sep, I will be shocked. 9 days is the long side of most auction durations, so maybe we're still seeing 1st day bids on some items before the smack-down.

Velocity
Sep 27, 2011 - 11:37pm

@ blknblu1 ....RRSP & TFSA ...RIP !!!

BLK, i'd not recommend to anyone any pension scheme (scam) whatsoever

Any 'tax free' pensions has been worked out at US Govt level.. namely these type of pensions are sucker punches by the Big Boys in Pensions and the Big State.. they are sitting ducks for the same scumbags when the Govt comes raiding EVERYBODIES pension schemes, public and private

Get out of ALL pensions and tuck your money away where the Goonsquadmugs, sorry Govt, cannot touch it... PM's bought for cash privately (say you bought a lawnmower) are peeeerfect

thesandbox
Sep 27, 2011 - 11:37pm

Diego Garcia....

Nice to know others have had the luxury of staying there...We fly in there on the channel missions and pick up/drop off maybe half dozen or so at a time....the stop in the Azores is much more appealing but they don't have a t-shirt. ;) ....carry on now...

cpnscarlet
Sep 27, 2011 - 11:38pm

FWIW - Max Q and Rocket Science

Thanks for the vid Turd - I can relate. You should have pulled a launch when there was some more moisture in the air. You can really "see" the shock waves starting to form during Max Q as the shuttle goes trans-sonic. The shock waves and expansion fans can be "seen" as the water vapor in the atmosphere is condensing and vaporizing through the different pressure zones.

For some who asked - What happens at :55 and 1:15 are the calls from the CAPCOM and PAO on what is happening with the SSMEs. AOK?

Doc1800
Sep 27, 2011 - 11:38pm

Time will tell where we are, what is real, what is fantasy

Volatility is again high and getting higher, but the snap backs are hard as well. This was not the case in previous years. If we believe that supply and demand rules the day, in the end anyway; then maybe there is not as much supply as in the past. This is a premise many authors have touted, and so far that appears to be true in my estimation; but again only time will tell. It is important when making any investment to have a timeframe you are trading off of. We all like to look at our charts, and truth be told I use TA probably more than most, but i always look at what i am trading- its tendencies as a commodity or equity- and my timeframe for my trade or investment. As far as gold and silver are concerned my timeframe is measured in years, thus far it has had a great return measured that way. My miners have done well measured in that way as well, so nights like sunday are hard to swallow, but in the end it is a mere blip on my screen bc my timeframe is larger than one night. Just commenting and hope it helps someone.

steeled
Sep 27, 2011 - 11:39pm

@ survivalwstyle

Pepper-spraying cop accused of abusing Bush protesters in 2004

Activists have identified the senior New York Police Department officer who allegedly pepper-sprayed young women at the "Occupy Wall Street" protests, and it's not the first time he has been accused of civil rights abuses.

The Guardian confirmed that the officer is Anthony Bologna, who was also accused of civil rights abuses and false arrest during the 2004 Republican National Convention in New York City.

Photographs of the officer's badge also suggested that Bologna was the person in question.

A file released by the hacker group Anonymous pointed to a 2007 civil rights suit filed against Bologna.

Post A. Posr, the man named as a plaintiff in that suit, was arrested during the 2004 convention although he wasn't actively taking part in the protests.

"Police contend that Posr hit the man with a rolled-up newspaper," Posr lawyer Alan Levine told The Guardian. "He said he was just talking to the guy. Bologna ordered another officer, Camejo, to arrest Posr."

Posr was taken to a make-shift detention facility at Pier 57, where he was held until the protests were over.

Officer Tulio Camejo was also named in the suit.

"A bunch of us were wondering if any of the same guys were involved," Levine recalled.

more....

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