More Downside Ahead?

263
Tue, Oct 4, 2011 - 4:01pm

Wow, this is really getting ugly. Metals down. Miners down. Yuck. Can it get worse? You bet it can. How much? I guess that depends upon whether or not this is "IT".

Gold 1596. Silver 28 and change. ABX 43. EXK 7.60. SLW 25.97. YIKES! DOUBLE YIKES!! But there is currently a pretty significant rally taking place in the stock market so maybe all is well. OK, probably not. It's more likely just The Fed painting the tape through the intercession of their primary dealers.

Here are your updated PM charts. This latest selloff has made their nascent recoveries look tenuous, at best. Both appear poised for a mid-week test of last weeks lows.

Having fallen this far, it's hard for me to believe that the metals won't test their respective long-term trendlines before they are done. Here are re-prints of the weekly charts I posted back on Sunday.

And here is a 5-year chart of the HUI. The 480 area has often acted as support but it wouldn't surprise me to see this index fall all the way to 450. Of course, if the U.S. stock market collapses this month like it did 3 years ago, it ain't gonna stop there so, if you own the miners, you should stay very cautious.

And this, from ZH, offers about the best advice available right now:

https://www.zerohedge.com/news/non-news-dexia-bad-bank-sends-market-soaring

Now, go forth and prepare. We may be on the verge of the great collapse that so many of us have been expecting. We might also not be. Maybe the proverbial "can" can get kicked a bit further down the road once again.

Who can say for sure?

If we aren't on the verge, we should consider ourselves blessed for having additional time to prepare.

If we are on the verge, God help us all. TF

About the Author

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  263 Comments

HeNateMe
Oct 4, 2011 - 4:04pm

Worst

Worst?

kliguy38
Oct 4, 2011 - 4:07pm
silvergoldsilver
Oct 4, 2011 - 4:07pm

Anyone get the rally memo?

from 3-4 today? SQUEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEZE them lemons. I guess Dexia not failing today was enough for the HFT to kick in. Good luck trading.

tread_w_care
Oct 4, 2011 - 4:10pm

Bring it on

I am getting greedy with my next phyzz order. 1500 please. Make my day.

LongGoldLongSilver
Oct 4, 2011 - 4:11pm

Just the Cover They Need

It's just the cover they need to unleash the mother of all QEs. Just read between the lines...or on the lines! "The Federal Reserve could start a new broad-based lending program to address a potential run on U.S. financial system if the European crisis worsens, Federal Reserve Board chairman Ben Bernanke said Tuesday. 'We would make sure we would stand ready to provide as much liquidity against collateral as needed as lender-of-last-resort for our banking system' Bernanke said in testimony to the Joint Economic Committee of Congress. While the Fed does not 'anticipate' needed to start such a program, 'we will certainly be prepared to respond if anything eventuates,' Bernanke said. The Fed would need the approval of the Treasury Secretary before starting such a program, he said."Read full MarketWatch article here

Well, you can take it to the bankrupt bank that the European banking crisis will worsen and even more so that Geithner will stand behind such action.

https://www.economicfreefall.com

OC15
Oct 4, 2011 - 4:13pm

Nice call

"If he doesn't hint at printing the 3-4 session will be a bloodbath"...NOT

Bay of Pigs
Oct 4, 2011 - 4:13pm

Golden Jackass

From Jim Willie,

USTBONDS: The Monster Spleen

The USTBond is in strong rally mode because the United States is in the process of systemic failure, leading ultimately to some form of official debt default. The Greek Govt Bond yield rises from its fractured insolvent ruined status. The USTreasury Bond yield falls from its fractured insolvent ruined status also. It is a Black Hole, attracting funds from productive chambers of the USEconomy and pulling them into the dark place loaded with deficits, defaulted debts, and decay of capital.

Fiat money has turned toxic, and so have their bonds which support the crumbling monetary system. The mess in Europe offers an excellent glimpse of what it to come to the United States. We have our mortgage toxic vat. They have their PIIGS sovereign toxic vat. The US has transformed into the prettiest horse in the glue factory.

https://news.goldseek.com/GoldenJackass/1317763342.php

dumpstergourmet
Oct 4, 2011 - 4:15pm

Perfect timing

Looks like Calvin has got the bloat and is bouncing like a superball.

LongGoldLongSilver
Oct 4, 2011 - 4:17pm

Financial Index

www.economicfreefall.com

Do you really think they're gonna let this one go to 2000? Well, maybe...but not without some heavy injections of liquidity. The banks are broke, QE or not, but gold and silver don't have 50 trillion dollars in bad collateral on their balance sheets. Expect them to respond accordingly to warp-speed printing.

FogHorn LegHorn
Oct 4, 2011 - 4:19pm

long term gold chart 9.99 -what a deal folks!!

Spot gold @ 9.99 but wait, we'll double that offer you'll get 2 ounces of bullion for the amazingly low price of 9.99 an ounce , just pay extra shipping and handling, send your check or money order to the morgue attn/ b.masters act now! limited offer , max ten per household.

Key Economic Events Week of 10/14

10/15 8:30 ET Empire State Fed MI
10/16 8:30 ET Retail Sales
10/16 10:00 ET Business Inventories
10/17 8:30 ET Housing Starts and Bldg Perms
10/17 8:30 ET Philly Fed MI
10/17 9:15 ET Cap Ute and Ind Prod
10/18 10:00 ET LEIII
10/18 Speeches from Goons Kaplan, George and Chlamydia

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Key Economic Events Week of 10/14

10/15 8:30 ET Empire State Fed MI
10/16 8:30 ET Retail Sales
10/16 10:00 ET Business Inventories
10/17 8:30 ET Housing Starts and Bldg Perms
10/17 8:30 ET Philly Fed MI
10/17 9:15 ET Cap Ute and Ind Prod
10/18 10:00 ET LEIII
10/18 Speeches from Goons Kaplan, George and Chlamydia

Key Economic Events Week of 10/7

10/8 8:30 ET Producer Price Index
10/9 10:00 ET Job Openings
10/9 10:00 ET Wholesale Inventories
10/9 2:00 ET September FOMC minutes
10/10 8:30 ET Consumer Price Index
10/11 10:00 ET Consumer Sentiment

Key Economic Events Week of 9/30

9/30 9:45 ET Chicago PMI
10/1 9:45 ET Markit Manu PMI
10/1 10:00 ET ISM Manu PMI
10/1 10:00 ET Construction Spending
10/2 China Golden Week Begins
10/2 8:15 ET ADP jobs report
10/3 9:45 ET Markit Service PMI
10/3 10:00 ET ISM Service PMI
10/3 10:00 ET Factory Orders
10/4 8:30 ET BLSBS
10/4 8:30 ET US Trade Deficit

Key Economic Events Week of 9/23

9/23 9:45 ET Markit flash PMIs
9/24 10:00 ET Consumer Confidence
9/26 8:30 ET Q2 GDP third guess
9/27 8:30 ET Durable Goods
9/27 8:30 ET Pers Inc and Cons Spend
9/27 8:30 ET Core Inflation

Key Economic Events Week of 9/16

9/17 9:15 ET Cap Ute & Ind Prod
9/18 8:30 ET Housing Starts & Bldg Perm.
9/18 2:00 ET Fedlines
9/18 2:30 ET CGP presser
9/19 8:30 ET Philly Fed
9/19 10:00 ET Existing Home Sales

Key Economic Events Week of 9/9

9/10 10:00 ET Job openings
9/11 8:30 ET PPI
9/11 10:00 ET Wholesale Inv.
9/12 8:30 ET CPI
9/13 8:30 ET Retail Sales
9/13 10:00 ET Consumer Sentiment
9/13 10:00 ET Business Inv.

Key Economic Events Week of 9/3

9/3 9:45 ET Markit Manu PMI
9/3 10:00 ET ISM Manu PMI
9/3 10:00 ET Construction Spending
9/4 8:30 ET Foreign Trade Deficit
9/5 9:45 ET Markit Svc PMI
9/5 10:00 ET ISM Svc PMI
9/5 10:00 ET Factory Orders
9/6 8:30 ET BLSBS

Key Economic Events Week of 8/26

8/26 8:30 ET Durable Goods
8/27 9:00 ET Case-Shiller Home Price Idx
8/27 10:00 ET Consumer Confidence
8/29 8:30 ET Q2 GDP 2nd guess
8/29 8:30 ET Advance Trade in Goods
8/30 8:30 ET Pers. Inc. and Cons. Spend.
8/30 8:30 ET Core Inflation
8/30 9:45 ET Chicago PMI

Key Economic Events Week of 8/19

8/21 10:00 ET Existing home sales
8/21 2:00 ET July FOMC minutes
8/22 9:45 ET Markit Manu and Svc PMIs
8/22 Jackson Holedown begins
8/23 10:00 ET Chief Goon Powell speaks

Key Economic Events Week of 8/12

8/13 8:30 ET Consumer Price Index
8/14 8:30 ET Retail Sales
8/14 8:30 ET Productivity & Labor Costs
8/14 8:30 ET Philly Fed
8/14 9:15 ET Ind Prod and Cap Ute
8/14 10:00 ET Business Inventories
8/15 8:30 ET Housing Starts & Bldg Permits

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