Wed, Nov 9, 2011 - 11:11am

Oooh, boy. Today is shaping up to be a real doozy. The rest of this week, too. It will be important to remain calm.

News of margin hikes on Italian debt and an Italian 10-year note trading above 7% has sent global markets reeling this morning. In response, gold and silver have traded off of their highs as the world spins into "risk off" mode. Now, while I can't say for sure when the world will flip back to "risk on", I do know this: The only way out is the creation of new, paper money. Defaults, bankruptcy, "haircuts"...all lead to the same conclusion. The only tool that central banks have to forestall disaster and collapse is the printing press. Though the day-to-day machinations of the PM markets can drive you crazy with their seemingly nonsensical price moves, your only protection through this storm is physical metal. Continue to acquire it...while you still can.

Let's start with silver. No change in my forecast from earlier this week. Even though its been washed back some today, I still ardently believe that a sharp upleg is coming that will take silver to and through 37 and, from there, up to our target area of 39-41.

Though gold has been pushed back, too, the resistance certainly wasn't unexpected. My initial target from 2 1/2 weeks ago was 1780-1840 and we split the difference to call it 1810. Here's the chart from 10/25:

And here is the chart from two days ago:

So the question is, where do we go from here? In a word...higher! Gold has built a terrific base of support below it and, very soon, it will charge through 1800 and hold. From there, the next major resistance should be somewhere around 1840 and, once it gets through there, it will head back to the September highs. My initial forecast from 2 weeks ago was for a 10% rally in five weeks to 1810. We can just about call that good as gold reached 1805 yesterday. However, I like these charts very much and they're telling me there is more room to run this month. As mentioned Monday, if we can hold the line this week and close above or near 1800, we should be very optimistic about the prospects for $1900 gold before the end of the month.

OK, that's all for now. Hang in there and try to enjoy the ride. TF

p.s. John Soltez has offered to be a part of an ongoing forum thread. You can find it here:

If you have any questions for John, he will respond directly to you in this forum.

About the Author

turd [at] tfmetalsreport [dot] com ()


Nov 9, 2011 - 1:55pm


Just curious, has anyone quantified this year down days in gold and silver vs. up days. It would be an interesting exercise to take on. For some reason there seems to be more down days then ups..but net-net we are up for the year.

Nov 9, 2011 - 1:59pm


Endless printing of money will 'revalue' gold for them - I don't think they have any choices left. They just create new layers of credit. Now we will have more IMF SDRs to back CDOs that don't pay out on a bunch of other Three Letter Acronyms. And bingo, more credit to lever and it carries on week after week.

(And I know they aren't really acronyms like UNCLE, or CHAOS, but common usage rules the day.)

Nov 9, 2011 - 2:00pm

Wait a minute

The fed has already secretly begun QE3 and they must find a window of opportunity to announce it. Maybe the Euro sovereign crisis will be that event, maybe not. So how can the fed and the EE announce QE3 if gold is once again running away towards $2,000?

There has to be another beatdown planned. I don't see the crisis exploding before Xmas because the EE wants people spending and getting indebted without fear during the holidays. After all, some stores get 50+% of their sales during the holidays. So the crisis that ushers in the announcement of QE3 has to start very soon but not too soon, and my guess it will be early in Q1 2012. Even though I own physical, I will not deploy further cash (i.e. toilet paper) until after the year-end run-up in gold and the next beatdown of it, which would put us somewhere in mid-January for a buy point.

BostonMatrix DayStar
Nov 9, 2011 - 2:00pm

JPM correlation

@ Daystar I don't know about SLV v JPM but I recently overlaid the JPM and Ag spot charts since May, which was interesting. See it here: I haven't plotted margin hikes or other events on there but may well go back and do that now.

Nov 9, 2011 - 2:00pm

what's worse Penn State or MFing Global?

the high-level similarities in these institutional frauds speak to the endemic moral crisis in Western Civilization. These are human problems and have plagued us since the beginning.

cpnscarlet GoldMania3000
Nov 9, 2011 - 2:02pm

@Peace Silver - this has been

@Peace Silver - this has been done previously as part of the charting of gains and losses over a 24 hr period. On the COMEX, there are many more down days than up days with crashes coming at almost exactly the same time every day. In the rest of the world - many more up days.


Nov 9, 2011 - 2:03pm

A song for Christmas shoppers

Stop giving me crap for Christmas
opticsguy RightLeftWrong
Nov 9, 2011 - 2:03pm

Penn State or MFG

It has become clear that laws only apply to the 99%. The 1% get a free pass.

Sports heroes, though no the 1% in wealth, are still the 1%. What major sports figure has had to do jail time for drunk driving or "murder"?

How long before Obama declares he has "first night" privileges with all new brides? If you're going to act like a king, go all the way!

cpnscarlet RightLeftWrong
Nov 9, 2011 - 2:04pm

RightLeftWrong said -

the high-level similarities in these institutional frauds speak to the endemic moral crisis in Western Civilization. These are human problems and have plagued us since the beginning.

Allow me to be a tad more specific - Too many people chasing too many Sauls while too many Davids hide in caves.


Nov 9, 2011 - 2:05pm

The master:

Jim Rickards - Gold Price Suppression Will Fail Soon

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