The Impenetrable 1750

Wed, Feb 8, 2012 - 10:24am

This is the first of two posts today as I try to get caught up from yesterday. The metals have rallied nicely while The Pig has fallen but, of course, the question is: What happens next?

Our buddy, "Ranting Andy" has ranted for years about the predictable nature of The Cartel's beatdowns, noting that they often occur at the same time, nearly every day. Earlier this week, we saw blatant, unhidden manipulation on the LBMA at precisely 3:00 am EST. Today, for whatever reason, the 3:00 am attack wasn't quite as sharp so the responsibility fell to their brethren on the Comex. As you can see below, the monkeys barely misses a beat.

As often stated here, I don't really care if you agree or disagree with me regarding the manipulation of PM prices. If you choose to remain in NormalcyBiasLand, hoping and praying in the illusion of "free markets", knock yourself out. I'm just here to tell you what I believe and, to me, it is very clear that the precious metals are actively manipulated and suppressed on a daily basis.

Does this mean that gold is going straight down from here? Of course not! The fundamentals remain extraordinarily strong. The Cartel simply fights to keep prices "under control" for a variety of reasons.

This brings us back to the title of this post. Why is $1750 being defended so vigorously? Well, it serves two purposes:

  1. Perhaps by holding the line at 1750, The Cartel can discourage enough spec long buying that gold will eventually roll over and get trapped in a box roughly bounded by 1700 and 1750.
  2. However, since this is unlikely, the main purpose is to suck up buying pressure at 1750 so that those funds are unavailable for use at 1800.

You see, $1800 is the real deal, The Battle Royale. When gold finally breaches that level again, on a daily and weekly basis, it will be cleared for a run back to the old highs of 1900+. Of course, The Cartel will be ready and waiting there to attempt to paint a double top but they'd rather not fight that fight. From their perspective, it would far preferable to instead hold gold below 1800. So, here's what I expect: I think gold will continue to struggle with 1750 for a while, maybe even another week or so. It will then break higher and through 1750 and 1760 and begin its run toward 1800. $1800 will be a Battle Royale.

Again, as discussed here ad nauseam, much will depend upon short-term changes in the POSX. Having fallen through its two-week floor yesterday, it will be interesting to see if the 78.80 (March) level will act as resistance today. I suspect it will and I'm looking for The Pig to fall toward 78 before the next level of support emerges.

Silver continues to look the best of all. It now appears to be building a base above $34, which is exactly what you would hope it would do following a successful breakout through resistance. Watch the level between 34.40 and 34.50 as a clean break through there will mean that the move is on to $35+. I would advise you against getting sucked in at this point, though. Silver is going to encounter very stiff, EE resistance between 35 and 35.50. That area will be Battle Royale I for silver. Battle Royale II will be the down-sloping trendline off of the April and September highs. That line currently resides around $37. The moral of the story is: The quick, easy money in paper silver is just about over. We'll need silver to fight and win the two Battles Royale before we can go aggressively long again.

Finally, just some cleanup of some headlines from yesterday and today. First up, there's this headline from RanSquawk that I saw earlier today on ZH:

"Iran and China to discuss alternatives to the USD; to discuss alternative currency oil trades according to the MEHR news agency"

Hmmm. Any chance that the headline above is related to this:

or this:

Lest you think there's actual hope for austerity and fiscal sanity in the U.S., I give you this:

And one last note about the ridiculously fabricated BLSBS numbers from last Friday. Our buddy, Jim Quinn, chimes in below:

OK, that's all for now. Give me a few hours and check back for that post on the miners that I've been promising you. Have a fun day! TF

About the Author

turd [at] tfmetalsreport [dot] com ()


Feb 8, 2012 - 10:25am



Feb 8, 2012 - 10:30am

I encourage all to do this.

I am issuing a fatwah against any and all people who simple write a post saying "X number".

You will be placed on ignore.

You petty fucking children, grow up.

I encourage everyone else to do the same.

And if Bellyacre tries to respond to this I will never see it.

Oh well, my loss.

And if you want to ignore me, so be it.

Feb 8, 2012 - 10:32am

reviewing the Kitco chart...

shows that gold hit or slightly breached $1750 five times in the last 18 hours. While silver is currently bumping off $34.40. Both of these seem to be "lines in the sand". they both will fall, maybe even today.

Feb 8, 2012 - 10:34am


very good summery

Be Prepared
Feb 8, 2012 - 10:40am

Rasta Monkeys...

Don't Worry... Be Happy...

Feb 8, 2012 - 10:40am

Gunning monkeys

Wild monkey alert!

Ok technically a chimp...but still part of the monkey species.

With a gun.

Aww nuts!

Feb 8, 2012 - 10:42am

Out-of-money experience

Continuing posting items from a recent issue of The Sun. The quotations below were not linked at the time they were first uttered. But don't they fit together well?


I am having an out-of-money experience.

Author unknown


The issue isn’t just jobs. Even slaves had jobs. The issue is wages.

Jim Hightower - columnist, radio commentator,


The poorest people in our country today . . . are earning wages so low that they cannot begin to function in the mainstream of the economic life of our nation. . . . We have thousands and thousands of people working on full-time jobs, with part-time income.

Martin Luther King Jr.

Feb 8, 2012 - 10:43am

Thanks for the update

If they keep gold around or under $1750 it's probably seen by the general public as being closer to $1500 then $2000 and not so safe as an investment due to it sliding backwards towards $1600 etc. That's not what I believe, but if I were a average investor who only listens to the MSM or if I only the heard the negatives about gold then I'm probably thinking it's too volatile and falls too rapidly.

$1750 would seem to be a big psychological benchmark (among other things) that they are trying to hold the line on. Once we approach or breach $2000 is when it will grab everyone's attention, big and small investors alike, and I don't think they are ready for $2000 gold or $50 silver yet.

$1750 keeps it on the razors edge of risk for now for the small and uninformed investor who only hears of gold mostly being sold off at times and all of the downside risk. Thank the MSM for that.

Feb 8, 2012 - 10:44am

Monkey In Black

What happens when Agent J goes ape shit.


Feb 8, 2012 - 10:48am

The first shall be last and the last shall be first

LANDOWNER: I will give each of you a denarius to work in my vineyard for the day.
WORKERS: That sounds fair to us.
NARRATOR: About the third hour he went out and saw others standing around doing nothing.
LANDOWNER: You also go and work in my vineyard and I will pay you whatever is right.
WORKERS: We’ll do it!
NARRATOR: The landowner went out again about the sixth hour and the ninth hour and did the same thing. About the 11th hour he went out and found still others standing around doing nothing?
LANDOWNER: Why have you been standing here all day doing nothing?
WORKERS: Because no one has hired us.
LANDOWNER: You also go and work in my vineyard.
NARRATOR: In the evening…
LANDOWNER (TO HIS FOREMAN): Call the workers and pay them their wages, beginning with the last ones hired and going on to the first.
NARRATOR: The workers who were hired about the 11th hour came and each received a denarius. So when those came who were hired first, they expected to receive more. But each one of them also received a denarius.
WORKERS: This is not fair! These men who were hired last worked only one hour, and you have paid them the same as us have done most of the work in tat of the day.
LANDOWNER: Friend, I am not being unfair to you. Didn’t you agree to work for a denarius? I want to give the man who was hired last the same as I gave you. Don’t I have the right to do what I want with my own money? Or are you envious because I am generous?
JESUS: So the last will be first, and the first will be last.

Comparisons and silver content of a silver denarius

Flavia Domitilla, wife of Vespasian and mother of Titus and Domitian.

It is problematic to give even rough comparative values for money from before the 20th century, as the range of products and services available for purchase was very different. The coin's purchasing power in terms of bread in the first century AD has been estimated as equivalent to US$21 in 2005. Classical historians often say that in the late Roman Republic and early Roman Empire the daily wage for an unskilled laborer and common soldier was 1 denarius (with no tax deductions) or about US$20 in bread[citation needed]. By comparison, a laborer earning the minimum wage in the United States makes US$58 for an 8-hour day, before taxes. The silver content of the denarius under the Roman Empire was about 50 grains, or 110 troy ounce. In June 6 2011, this corresponded to approximately US$3.62 in value if the silver were 0.999 pure (which it wasn't).[citation needed]

The fineness of the silver content varied with political and economic circumstances. By the reign of Gallienus, the antoninianus was a copper coin with a thin silver wash.[10]

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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