Odds. Ends. Out.

Thu, Feb 16, 2012 - 5:08pm

Just a few items as we wrap up Thursday and prepare for Friday.

First, I must chuckle and fart in the general direction of the Bullion Bank Cartel. As they arrived this morning, they thought they were going to put the hammer down today. The POSX was rallying and it was game on. As documented in the previous thread, from the opening bell The Cartel attacked...and attacked...and attacked. They soon ran into two, fundamental problems.

  1. The Pig suddenly reversed. (Do you see what I mean about Forex ripping you to shreds if you let it?)
  2. Over a thirty minute period, four stabs below 1710 were all met with plentiful buy orders.

Oh how The Forces of Darkness must be angry and confused this evening. This is not supposed to be how it works! Everything was set for a raid today. Gold would finally be taken back under 1705 and silver would be pushed below $33. OOOOoooops. As Coach Corso would say: "Not so fast, my friend". As quick as you can say "Sergey Aleynikov", the WOPRs flipped over to BUY from SELL and the metals charged back higher.

This all sets up a rather interesting day tomorrow. As you know, silver has painted red candles on the last two entries to the weekly charts and gold was red last week. Will they do so again this week? Silver needs to beat $33.58 tomorrow and gold's level is just $1723.

Adding to the intrigue is a big jump in OI yesterday. On a day where gold traded higher by about $10, total OI jumped by 7010 contracts, with 6,000 being added to the front-month April12. At 438,174, that's the highest total OI since 1/20/12, three days before the FOMC minutes that sparked gold over $60. Silver also saw it OI jump by almost 2000 contracts on a day where price rose just 6 cents. At 106,621, the total OI is now the highest it's been all year. Hmmmm. The silver picture is particularly interesting given that 1-month lease rates are again approaching -0.40% tonight. Caution is definitely still warranted.

Just for fun, here's a POSX chart that has lines drawn all over it like I'm some kind of actual, fancy-schmancy technician. It's probably useless but it's worth looking at, anyway.

Here are a few items I've picked up along the way today:

A solid chart summary from Trader Dan.


As if you needed more evidence that infinite QE is necessary and coming:


Gonzalo has written a timely, new piece:


You absolutely MUST READ this:


This is pretty solid from Denver Dave:


And this is certainly interesting, too:


That's it. Have a great overnight! TF

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