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Other Technical Indicators

218
Tue, Jan 10, 2012 - 6:50pm

As you know, I like to poke fun sometimes at the chartists and the elliotts for relying so heavily upon their squiggly lines that they fail to see the forest from the trees. At the risk of seeming hypocritical, I thought I'd show you some charts that include those squiggly lines this evening as I continue my search for tradable bottoms.

Before we begin, a recap of today and a repost of the charts I included as an update to the earlier blog. To simply summarize, yes today was great. Both metals broke free of their recent downtrends and looked good doing it. However, keep in mind that today was a Tuesday and "Happy Tuesday" often results from The Cartel covering some shorts in an effort to "paint" the CoT survey that took place after the close this afternoon. Because of this, do not be surprised to see the metals give back some of today's gains tomorrow. Additionally, let's be sure to check the OI numbers from today when they are released tomorrow. If new money was driving today's gains, we will see a nice increase in OI. If today was primarily a Cartel short-covering event, the OI will be relatively flat. Regardless, the gains in price are real and both metals suddenly have a much improved technical picture. Let's see what the rest of the week brings. To really get me excited, silver needs to close above $30.50. Gold needs to first close above $1650. Then it needs to break the downtrend line from the highs of September. That line is currently near $1680.

paper_1-10amsilv_0.jpgpaper_1-10amgold_0.jpg

OK, now let's look at two, other technical indicators as we search for a bottom. First, a disclaimer:

Look, we all know that the metals are blatantly and selfishly manipulated by The Cartel. In fact, my ability to accurately forecast price is primarily due to my understanding of this manipulation. However, as you know, the major spec money in the pits is driven primarily by HFT algos and technical indicators are some of the primary factors that cause the algos to switch from buy to sell and vice versa. So, technical analysis indicators are occasionally quite helpful in that, in the closed-loop of single market trading, if all participants are looking at the same information, price forecasting almost becomes a self-fulfilling prophecy.

So, here we go. Let's look at two of the major indicators and see if they are telling us anything. First up,

MACD

Definition: https://stockcharts.com/school/doku.php?id=chart_school:technical_indicators:moving_average_conve

Now look at these pretty charts. The blue line is the one you want to watch. Note that the blue line often bottoms shortly after price bottoms OR tops shortly after price tops. What you are looking for are price trend changes that are signaled by the blue line crossing over the red line. Look closely. Maybe print these off yourself. Notice that, recently, the blue line crossed UP through the red line in both gold and silver. This is good news!

paper_1-10pmgoldd.jpgpaper_1-10pmsilvd.jpg

And the other technical indicator we need to review is the...

RSI

Definition: https://stockcharts.com/school/doku.php?id=chart_school:technical_indicators:relative_strength_index_rsi

The RSI only gives you only line to follow. When the line reaches way up over 70, the commodity is generally considered to be "overbought" and subject to a decline. Conversely, when the line is down near 30, the commodity is considered to be "oversold".

First, on the gold chart, note that lows in the RSI have generally occurred one week before lows in price and a couple of weeks prior to price trendline breakouts. Also note that the RSI itself will breakout from downtrends and, when it does, it usually portends higher prices. In silver, we get a similar picture. Pay special attention to the longterm RSI trendline. It has been downsloping since May and it just broke out back at the first of the year. This is a very encouraging development.

paper_1-10pmgoldw.jpgpaper_1-10pmsilvw.jpg

Again, secondary technical indicators are not the be-all-end-all that many chartists make them out to be. However, they can occasionally be helpful when looking for trend changes in price...kind of like what we are currently doing. When you combine the RSI, the MACD, the price charts and the OI numbers, you begin to get a sense that we have seen the bottom in both metals . Let's now just patiently wait for price to confirm these developments.

TF

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  218 Comments

Bay of Pigs · Jan 11, 2012 - 10:38am

Information on the man is readily available. Someone posted the other day that JPM and Goldman Sachs were two of his top three contributors, along with Credit Suisse (source was cited). In other words, the Banksters are behind him. What else do you need to know? Even a quick search from your computer would yield you enough evidence tell you this guy is as connected and as dirty as they come. As I recall, Shill and other posters have provided boatloads of evidence on this guy in the past.

Dr G · Jan 11, 2012 - 10:55am

Santa's angel of $1650 is coming into view now. There should be a continued battle there. After that, 1681 is the next angel.

EDIT: Matches exactly what trader Dan says, since he is Sinclair's chartist, that would make some sense (even though they are using different methods to arrive at the numbers).

boatman · Jan 11, 2012 - 10:58am

a true patriot like ron paul....i will continue to vote for the lesser of two evils.

hillary would be better 'n obozo.

cpnscarlet I Run Bartertown · Jan 11, 2012 - 11:09am

Darn you Bartertown! Posting that Detroit Council vid just pushed my buttons and now I'm going to say something I'll get flamed for -

I always thought universal suffrage was a bad idea.

Patrancus · Jan 11, 2012 - 11:11am

The endgame is here though is still a ways off, and folks have time to really mix things up and here is what we accomplished along with thousands of others 4 years. 

I attended my local caucus along with a few others from my neighborhood. We had made plans (rehearsal) prior to caucus to advance resolutions in regard to the Federal Reserve Bank, Voter ID, Immigration, others. In regard to the Federal Reserve, we made use of Caucus in this way, one would stand up and make his or her Whereas and resolve that the Federal Reserve Bank should be eliminated, then another would rise to challenge the resolution, then another would rise and speak to why?, and then still another would rise and speak to particulars of why the Federal Reserve has shirked one of its primary responsibilities of say defending the purchasing power of the dollar, another would rise and hold up a 1 oz double eagle explaining how our republic used to operate with real money, the room was chalk full of faces of bewilderment and amazement.

Which brings us to today where many more millions of Americans are now up to speed or are gaining knowledge of issues we debated in resolutions years ago in the last presidential cycle. We even have a candidate for President of the United States who speaks openly about these issues in his Primary speeches. 

All it really takes is to locate those people in your local areas of influence, get organized and then to get busy working to restore Liberty.

Tabberto · Jan 11, 2012 - 11:11am

EBT - That was completely brilliant, made my heart soar to see SATIRE coming from the most unexpected of places!!

We need a UK version of this immediately

I Run Bartertown · Jan 11, 2012 - 11:15am

Cpn enlightenedyesyes

Tabberto - glad you liked it!

https://naturalborncitizen.com/

Maybe this is why the repubs never pushed the real definition of "Natural Born Citizen".

When Mitt Romney’s father George Romney ran for President in 1968, nobody seemed to care that he was born in Galeana, Chihuahua, Mexico. The media just assumed that because his parents were allegedly US citizens he was too. The media never really questioned the possibility that Romney’s ancestors, who voluntarily left the Utah territory before Utah became a state in 1896, may not have been citizens within the meaning of

SRSrocco · Jan 11, 2012 - 11:18am

A FEW TIDBITS ON FRACTIONAL RESERVE

I discuss this in detail in my article, but here are some interesting facts. The United States has a minimum reserve requirement of 10% for the Banking System. This is just the icing on the cake... it gets much worse than that.

These countries have no MANDATORY RESERVE REQUIREMENT:

Australia

Canada

New Zealand

Sweden

----------------------------------------------------

That's right... ZIP. Of course they have some sort of reserve, but there is no "OFFICIAL RESERVE REQUIREMENT" by their Central Banking Authority. 

Oh what a mess we have gotten ourselves into with this FIAT MONETARY SYSTEM.

By the way... Ned Schmidt replied again today in my email basically saying:

My mission is to keep people from buying silver

People have lost too much in that JUNK METAL

Straight from the HORSE'S MOUTH.....

Zoltan · Jan 11, 2012 - 11:19am

In case you have forgotten they filed last year. Granted an extension until April 18, 2012.

https://www.ic.gc.ca/eic/site/bsf-osb.nsf/eng/br02667.html

go to the rsmrichter link to see all the court documents.

Interesting that they have Revenue Quebec (think IRS en francais) as an unsecured creditor to the tune of 317.7 million dollars. Ouch. Also crazy is the amount of money and metals customers still have in a pool with this company that is in a bankruptcy proceeding.

Caveat Emptor.

Z

yabyum · Jan 11, 2012 - 11:24am

Hecla is getting killed this am, closing the main shaft on the lucky friday for 2012 for "work"

agNau · Jan 11, 2012 - 11:25am

There is the small H&S noted by turd. But the pattern I see is large, and from the resistance points above should play out to pattern. We have seen these type patterns before(similar ie Cup and handle), as they are Consilidation/Continuation patterns. It only makes sense that both Gold(Large round number resistance 2000, AND Silver @ historical high) would need time to surpass these milestones. (This is without the manipulation, which goes without saying in Silver, as it is the "Achilles Heel" of the EE as I have stated for quite some time. Take the Silver price control out of their hands, and their Dollar Slavery ENDS! Remember that Silver and Gold "Sisters" historically walk hand in hand.) What I see happening is the "exit" shoulder completing more rapidly in time than the "entrance" shoulder. Whatever one thinks of the technical analysis, the truth is as Turd stated(ie the Algo's), that these levels are played by market participants and not just the algo's. In many cases you will see selling prior to reaching a key level; price pullback; then another run that fails at the line. Until something better comes, these lines/indicators are "helpful" to both traders and stackers.

Gold Five · Jan 11, 2012 - 11:26am

Chris Martenson lays out the data showing how wars have affected the dollar.

https://www.chrismartenson.com/crashcourse/chapter-10-inflation

· Jan 11, 2012 - 11:43am

Wow,

Provident is nearly out of Eagles... only the 2012 in stock, which may take a while for delivery?

I Run Bartertown · Jan 11, 2012 - 11:45am

https://youtu.be/iCmppOwVPFg

I think I've been bad and probably require discipline.

ClinkinKY · Jan 11, 2012 - 12:08pm
Sen. DeMint urges Republicans to listen to Ron Paul By Alicia M. Cohn - 01/11/12 11:10 AM ET

Sen. Jim DeMint (R-S.C.) said Wednesday the Republican presidential field needs to listen to Ron Paul's and would benefit from integrating some of his libertarian ideas into their platform.

"One of the things that's hurt the so-called conservative alternative is saying negative things about Ron Paul," DeMint told conservative radio host Laura Ingraham. "I'd like to see a Republican party that embraces a lot of the libertarian ideas."

Read more at link:

https://thehill.com/blogs/blog-briefing-room/news/203557-sen-demint-urges-republicans-to-listen-to-ron-paul-

cpnscarlet · Jan 11, 2012 - 12:09pm

@Bartertown - some serious beauties in uniform there - fun. But to be serious, why have we asked for our daughters the worst we fear for our sons? The world is messed up.

Drifter · Jan 11, 2012 - 12:09pm

I always watch my six leaving the LCS and a couple years ago I noticed a car behind me that stayed behind me for 4? turns or so. After the 2cd turn I started making unnecessary turns on purpose, it finally dropped away.

Coincidence? Probably. 

cpnscarlet · Jan 11, 2012 - 12:12pm

Some nice moves in Ag today, but now PSLV is down. Wonder what's getting that premium hammered? Natural market response? If such a thing was possible in Ag.

Big L · Jan 11, 2012 - 12:14pm

I am not inclined to present a detailed, factual response, as that would take far too long for me to collect the various sources for all the public information. Remember, I am expressing my opinion. You can judge for yourself whether my opinion is sound or not. Do your research, and come to some conclusions. All of the information has been presented by other fantastically gifted and brilliant posters too numerous to mention, as well as on zerohedge, on other countless blogs, which have large followings, and by many other sources as to make my effort to cite to them onerous and burdensome.

Let me also say that I am not supporting Romney, nor any of the other candidates. I do back Ron Paul's message, but the reality is, my vote counts not at all, as I live in the people's republik of kalifornia. The democrats will easily carry this state, so my vote is WORTHLESS. I like the electoral college system, for some reason, but for the last several presidential election cycles, my vote has not mattered. Hence, my basic hands off attitude on all of the candidates.

I am trying to inspire you all to think for yourself, by my posting my OPINION. How about you post YOUR opinion. I really just wanted to say what I believe, because I have found, like Dr. J mentioned above, that hearing another that holds the same opinion allows one to gain confidence in one's own opinion, and reinforces the information-collecting and conclusion-drawing cycle, hence making one a better critical thinker. That is all I am saying.

I have neither the time, nor inclination to present a detailed critique of any of the narcissistic individuals running for high office, other than to generally comment that anyone aspiring to high office has a personality disorder. Who would want that job, other than a power-hungry, self-interested narcissist? I want to enjoy my time with my family. I don't want to worry about the world's problems. I think I am normal. Hence my opinion on this.

Anyhow, another time, perhaps, I will feel inclined to weigh in. Otherwise, just keep reading the press accounts, the blogs, and all will be revealed to you if you want to see it.

As for you retireyoung, I am not wanting to engage in a professional argument here. Sheesh, I do that everyday, and get paid for it. So, I decline your invitation. If you want to share your opinion, though, I would welcome that, and I will not attack you for holding it. Civility, remember?

And for the others who defended me, please let me say thank you. I do appreciate it, and I do believe it adds to the civility here on the forum.

s2man · Jan 11, 2012 - 12:20pm

Thanks Turd, nice write up/analysis, and hilarious Range Balls vid.

I am happy to see PMs moving opposite of equities, as they should. And I am very pleased to see them going up, even as the POSX rises. I hope this is a disconnect from the FX trade, and PM markets start to trade on their own merit.

I Run Bartertown · Jan 11, 2012 - 12:21pm

https://youtu.be/DEbrLJnYUIg

https://youtu.be/6pHQCB78eQ8

And Cpn, I couldn't agree more. If the draft is ever reinstated with our daughters on the line, it's time to burn this MFer down.

Dr G · Jan 11, 2012 - 12:23pm

BAC. Dammit. Having lots of fun with that 6 handle. What a sham.

Tyler · Jan 11, 2012 - 12:23pm

If you do any research at all, you will find that Romney has flip-flopped over and over and said whatever he had to to be elected. He also has history and ties with the financial industry. If you look at his largest donors, it is a list of TPTB.

The main point to take away is that any President, Democrat or Republican, who does not come into the White House with a firm stance and history to back it up, will be swayed to do whatever they are told by TPTB.

CA Law sees trends toward certain elitist goals and believes that Romney, Obama, or any other teleprompters would be more than happy to oblige. (sorry CA if that is wrong)

boatman · Jan 11, 2012 - 12:25pm

don't reference Turdites....don't quote Turdites...........go to the debating forum.

dick bove VS chris whalen on tom keene now.

chris skewered him.

bove is a shill for the big banks....

ooops that was not at slight, Shill

johnboatcat · Jan 11, 2012 - 12:26pm

I wear a coat with large pockets and carry in a small paper bag. I come out empty handed and ride away. No one ever looks twice. If they did they would think I just sold something small. A small scooter does not give off a "wealth effect" aura either. I never go streight home.

FriedEggs · Jan 11, 2012 - 12:28pm

are beautiful - not because they are in a soldiers uniform - but because they are women.

.

WW3 will have a major role for women then like any other... Its part of theyre plan. 'They' want women really on the front lines in combat...

They want us to become all just one gender... thats the other front they battles us at - sexuality.

.

Nowadays - its 'gay' to be heterosexual. 

The heterosexual person is being discriminated almost more than any other group...

.

Fried(e)

Nick Elway · Jan 11, 2012 - 12:31pm

@srsrocco, from Wikipedia (below) After you factor in all of the exceptions, the reserve requirement in the US is way less than 10 per cent.

@boatman Careful what you wish for. The drum beats for Hillary to replace Biden as VP in 2012. Remember how Johnson became president.

From Wikipedia https://en.wikipedia.org/wiki/Reserve_requirement :

The only deposit categories currently subject to reserve requirements are net transactions accounts, mainly checking accounts. The total amount of all net transaction accounts held in USA depository institutions, plus US currency held by the nonbank public, is called M1.

A depository institution can satisfy its reserve requirements by holding either vault cash or reserve deposits. An institution that is a member of the Federal Reserve System must hold its reserve deposits at a Federal Reserve Bank. Nonmember institutions can elect to hold their reserve deposits at a member institution on a pass-through basis.[3]

A depository institution's reserve requirements vary by the dollar amount of net transaction accounts held at that institution. Effective December 29, 2011, institutions with net transactions accounts:

  • Of less than $10.7 million have no minimum reserve requirement;
  • Between $10.7 million and $71.0 million must have a liquidity ratio of 3%;
  • Exceeding $71.0 million must have a liquidity ratio of 10%.[4]

The numerical amounts stated above are recalculated annually according to a statutory formula.

Effective December 27, 1990, a liquidity ratio of zero has applied to CDs, savings deposits, and time deposits, owned by entities other than households, and the Eurocurrency liabilities of depository institutions. Deposits owned by foreign corporations or governments are currently not subject to reserve requirements.[5]

When an institution fails to satisfy its reserve requirements, it can make up its deficiency with reserves borrowed either from a Federal Reserve Bank, or from an institution holding reserves in excess of reserve requirements. Such loans are typically due in 24 hours or less.

An institution's overnight reserves, averaged over some maintenance period, must equal or exceed its average required reserves, calculated over the same maintenance period. If this calculation is satisfied, there is no requirement that reserves be held at any point in time. Hence reserve requirements play only a limited role in money creation in the USA.

Smiddywesson retireyoung · Jan 11, 2012 - 12:36pm

"Assuming you can find something there, what evidence do you have that the Congress, probably both Houses being controlled by Republicans, would allow such dire predictions as you have made to be enacted into law?"

After indefinite detention of Americans without trial, a bill to strip Americans of their Citizenship, executions of Americans without trial, and SOPA, what evidence do you have that they won't enact anything at all into law?

Hasn't the burden of proof shifted the the naysayers yet?enlightened

Dr G · Jan 11, 2012 - 12:37pm

Ron Paul says everybody else should drop out so that he can defeat Romney: https://www.buzzfeed.com/zekejmiller/ron-paul-to-everyone-but-mitt-drop-out

Smiddywesson Drifter · Jan 11, 2012 - 12:50pm

Drifter, a whole team of IRS agents with a PM sniffing pig couldn't find my PMs. If anyone here doesn't feel the same way, you need to spend some more time and imagination on your stash sites.

Notice: If you do not see your new comment immediately, do not be alarmed. We are currently refreshing new comments approximately every 2 minutes to better manage performance while working on other issues. Thank you for your patience.

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Key Economic Events week of 11/5

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