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Calvin? Anyone Seen Calvin?

150
Thu, May 10, 2012 - 9:55am

Meow! Looks like Calvin decided to show up this morning, right on time. Though this was predictable and somewhat of a relief to see, I wouldn't get too carried away just yet.

I once again attempted to draw the charts below as accurately as possible. The main takeaway here is that the lower end of the current down channel is the old down trendline from the highs of last August and November. Here, take a look:

In the grand scheme, really big picture, you must remember that this is exactly how this is supposed to work. When price moves through a down trendline, it typically springs higher and then retraces and "rides" the line lower, on the other side. We've talked about this phenomenon here at length on several occasion. As you can see on the weekly chart, gold is doing just that. Up until this week, the pattern was perfectly fine and gold looked ready to finally skip away from the line. Instead, here we are. It is faith in this pattern, however, that leads me to conclude that it is highly unlikely that gold will trade much lower than 1575, maybe 1550. The horizontal support there should be sufficient to allow gold to base between 1575 and 1625 and then, finally, break through and out of the channel.

Here's another look at the channel, this time on a daily basis:

Here's the best, longer-term silver chart I can give you. Note that The Battle Royale line continues to press silver lower, all the while anything from $30 down to $26 will see buying. This pattern will, eventually, be resolved but...as you can see...it could still be a while. Patience. Wait for the breakout or you risk getting whipsawed to death in the interim.

Just one, quick thing and then I've got to go. If you haven't read this yet, please do so now. David Stockman was Budget Director for Reagan back in the early 80s. Given that, this interview is rather remarkable:

https://www.testosteronepit.com/home/2012/5/9/the-emperor-is-naked-david-stockman.html

Sorry for the brief note this morning but other duties call. More later. TF

About the Author

Founder
turd [at] tfmetalsreport [dot] com ()

  150 Comments

Groaner · May 10, 2012 - 9:56am
George Carlin -"Who Really Controls America"
· May 10, 2012 - 9:57am

Apparently, the previous thread included a discussion of a customer service issue with Provident. They asked me to print this reply/explanation:

"We explained to "I Run Bartertown" that we were more than happy to replace the mercury dimes that he was not pleased with, and reimburse all shipping expenses. However, it should be noted that we use proprietary measures to ensure every order is correct before orders are boxed and shipped. Included in our processes is a triple verification, all of which is video taped, as well as other procedures to ensure customer satisfaction. We don't usually get complaints like this because we have made it nearly impossible to short our customers with the verification system we have in place. Furthermore, most of our large mercury dime lots contain more dimes than advertised. Never, at any point in the conversation did we say that we sell sub par precious metals because "sometimes people don't say anything". This goes against everything that our company stands for and the great relationships that we have established since Provident's inception. We are always willing and eager to correct any and all mistakes that do occur. We understand that it's essentially our word against "I Run Bartertowns", but we would ask that you give us a try with a small test order and find out for yourself."

Groaner · May 10, 2012 - 9:58am

Maybe we can gain some traction today

Santa's Elf · May 10, 2012 - 9:59am

As always, thanks for all you do!

NoSurrender · May 10, 2012 - 10:01am

Not First

Eric King · May 10, 2012 - 10:05am

yea!

survivalwstyle · May 10, 2012 - 10:06am

time is on our side. enjoy the ride. thanks as always for your insight. i am a haPPy provident customer. i sEE nothing to get excited about in Ag until we clear 34 with some authority. stack w/ regularity. peace

recaptureamerica · May 10, 2012 - 10:08am

I like provident... If I were to be interested in pms..Which according to mrs RA I am..

Eric King · May 10, 2012 - 10:09am

Looks like it will resolve by October 8th to me.

Groaner · May 10, 2012 - 10:10am

gold up $5 whoopee.. come on... how about a $30 move up???

Groaner Groaner · May 10, 2012 - 10:11am

Hits the nail on the head and then some

Dr G · May 10, 2012 - 10:13am

Turd, thanks for the update. It's a vicious cycle of the Euro being broken/USD strength vs. Euro being fixed/USD weakening.

Enough to drive anybody mad.

Also, I like Provident and have enjoyed doing business with them.

And October 8 for a silver resolve. Now that takes patience! Gonna be a long, hot summer. I'm just waiting for that silver gap at $48 to be filled :)

ClinkinKY · May 10, 2012 - 10:15am

@clinkinky

Submitted by Number 47 on May 10, 2012 - 9:56am.

I don't care about what he did, if he did it or if it matters. just wanted to point out that 'teasing' is verbal. That was a physical assault. If guys pinned me down right now and cut my hair I would not find it funny.

Or are we suggesting it is ok to force haircuts on people that we don't like? Can we all start randomly pinning folks to the ground and shaving them too? I don't like beards myself.

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

@ Number 47

Submitted by ClinkinKY on May 10, 2012 - 10:02am.

And I would hope that a national newspaper would report on it 47 (hmmm, interesting:) years later. Puhlease.

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

You really think that it is an "important" story for The Washington Post to report on given the problems facing the world/US?

Priorities man, priorities.

SaratogaPrepper · May 10, 2012 - 10:15am

Just got an e-mail alert on my phone.

Markdown .com has a deal on gourmet bacon and bacon toothpicks from a company called "Bacon Freak".

Sorry no pictures.....can't figure that out on this ithingee.

Back up the pole.

GoldMania3000 · May 10, 2012 - 10:16am
redwings103149 · May 10, 2012 - 10:18am

Keep an eye on Spanish bond yields here. A break above 6% will spell trouble, but FXE positive correlation to GLD right now is 6months rolling. Expect a bounce to 1.31ish in the euro at that point be nimble with any trades. GDX should test its 20sma near 45 as well. Jp out.

Number 47 · May 10, 2012 - 10:38am

You have to admit it is relevant, he is up for election. His stance on same sex marriage will be under scrutiny. If he assaulted a guy (even at school) over homosexuality then it might sway voters. 

I have no illusions the Romney campaign wouldn't do the same in reverse given half a chance. I agree that it is dirty politics but that seems prevalent on both sides, it is not a one way street.

Eric King · May 10, 2012 - 10:47am

Apart from a pretty chart, we really need something to drive up the *expected* silver move. Everyone is talking about the inverted head and shoulders pattern, but QE from the Fed will be the driver.

Jim Rickards tweeted that QE from the Fed won't start until EURUSD falls below 1.25 and with the Euro going over a cliff, it could be sooner than you think.

For those who missed it, Mr Sprott is calling silver over $50 by the end of the year on CNBC. Expectations are starting to get set very high, let's hope we get the follow through.

https://video.cnbc.com/gallery/?video=3000089121&play=1

Keg · May 10, 2012 - 10:48am

Just got a chance to read the interview with Stockman that Turd linked on the last thread. I have never been a big fan of Stockman, but this interview was outstanding. There are so few that have been on the "inside" that point out what has really happened. I have not bought in to the deflationary scenario he believes in, but who really knows. This is going to be a collapse on a scale never before seen. Two things that popped in my mind while reading this:

The cover up always creates more and bigger problems as seen in Watergate and many other cases. Stockman mentions letting things burn out. He did not expand on that but politicians have been covering up the problems for years rather than letting problems run their course and end. That extended the first great depression. And it will be the cause of the second.

Who the heck would want to be the next president? This is setting up so that the guy inaugurated in Jan. will be left holding the bag. History will likely not be kind to them for all the pain that occurred during their tenure, but the pain in inevitable no matter what they do, right or wrong. Really looking like a no win situation be it Romney or Obama. 

God help us. And keep stacking PMs and essential supplies.

The Green Manalishi · May 10, 2012 - 10:49am

Nigel is on today's Capital Account with the lovely Lauren Lyster - sorry not on the net yet.

Hrunner · May 10, 2012 - 10:51am

Just a little reminder for the turdites that may be stressed out this week.

https://www.youtube.com/watch?v=cBz5IdxITP8

Keep your thinking caps on and stay frosty.

The Green Manalishi · May 10, 2012 - 11:00am

If only to watch Lauren cross and recross her legsyes

thurd aye · May 10, 2012 - 11:03am

What do you expect.I bought gold so I am an uncivilised loser ,right?

ghost · May 10, 2012 - 11:05am

New metals exchanges in Asia mean absolutely squat for "true" price discovery. Makes it easier for TPTB to manipulate. Just another stupid reason and rhetoric for the perma bulls to lead themselves over the cliff. 

BUDDHA PRINCESS · May 10, 2012 - 11:06am

The Bank of England policy announcement headlines the European economic calendar. Expectations suggest Mervyn King and company will stick with the status quo, keeping the target lending rate at 0.5 percent and holding off from expanding asset purchases beyond £325 billion. Importantly, today’s decision will be made on the basis of an updated quarterly inflation report – a document to be made available publicly next week – meaning it is likely to be representative of where the central bank plans to take policy over the coming three months. This means that staying on hold here could prove supportive for the British Pound, signaling that inflation concerns that emerged in minutes from April’s BOE sit-down are likely to trump growth concerns for the time being despite the UK entering a technical recession in the first quarter.

Separately, the European Central Bank will publish May’s monthly report, which this time around will include the quarterly survey of professional forecasters. Traders will look to the document to inform their outlook for the depth of the economic slump plaguing the Eurozone as well as gauge the likelihood of additional ECB stimulus emerging in the near term. Considering the European downturn presents the most significant headwind facing global growth this year, a particularly dour report has scope to carry negative implications for the Euro as well as risk appetite at large.

The US Dollar and Japanese Yen sold off overnight as prices corrected after two days of gains. TheAustralian Dollar outperformed after April’s Employment report unexpectedly showed the economy added 15,500 jobs while the jobless rate fell to 4.9 percent, the lowest in a year. Details of the report proved less supportive than the headline number would suggest. The increase in hiring came entirely from part-time jobs while full-time employment declined by 10,500 and at least some of the decline in the unemployed owed to a shrinking labor force, with the participation rate dropping to 65.2 percent.

Still, the figures proved sufficient to trim bets on another RBA rate cut in June. Priced-in expectations now point to a 63 percent probability of a 25bps reduction in benchmark borrowing costs next months compared with 90 percent before the jobs data crossed the wires. China’s Trade Balance figures capped the Aussie’s advance however as imports registered at near-standstill while exports grew at the slowest pace in three months, stoking fears of a slowdown in Australia’s top overseas market. S&P 500 stock index futures are pointing higher in late Asian trade, hinting stocks-linked currencies may continue to recover against the safe-haven field.

Asia Session: What Happened

GMT

CCY

EVENT

ACT

EXP

PREV

17:30

NZD

REINZ House Price Index (APR)

3334.0

-

3343.5

17:30

NZD

REINZ House Price Index (MoM) (APR)

-0.3%

-

1.9%

17:30

NZD

REINZ House Sales (YoY) (APR)

13.8%

-

25.3%

22:30

NZD

Business NZ PMI (APR)

48.0

-

53.8 (R-)

23:50

JPY

Bank Lending incl Trusts (YoY) (APR)

0.3%

-

0.8%

23:50

JPY

Bank Lending Banks ex-Trust (APR)

0.4%

-

0.9%

23:50

JPY

Current Account Total (¥) (MAR)

1589.4B

1449.0B

1177.8B

23:50

JPY

Current Account Balance (YoY) (MAR)

-8.6%

-17.1%

-30.7%

23:50

JPY

Adjusted Current Account Total (¥) (MAR)

785.5B

650.0B

856.2B (R+)

23:50

JPY

Trade Balance - BOP Basis (¥) (MAR)

4.2B

-42.8B

102.1B

0:27

NZD

QV House Prices (YoY) (APR)

3.1%

-

3.0%

1:30

AUD

Employment Change (APR)

15.5K

-5.0K

37.6K (R-)

1:30

AUD

Unemployment Rate (APR)

4.9%

5.3%

5.2%

1:30

AUD

Full Time Employment Change (APR)

-10.5K

-

10.6K (R-)

1:30

AUD

Part Time Employment Change (APR)

26.0K

27.0K (R-)

1:30

AUD

Participation Rate (APR)

65.2%

65.4%

65.4%

2:00

JPY

Tokyo Avg Office Vacancies (%) (APR)

9.23

-

9.04

3:00

CNY

Trade Balance ($) (APR)

18.42B

7.93B

5.35B

3:00

CNY

Exports (YoY) (APR)

4.9%

9.1%

8.9%

3:00

CNY

Imports (YoY) (APR)

0.4%

12.5%

5.3%

4:30

JPY

Bankruptcies (YoY) (APR)

-6.7%

-

-1.9%

5:00

JPY

Eco Watchers Survey: Outlook (APR)

50.9

-

49.7

5:00

JPY

Eco Watchers Survey: Current (APR)

50.9

-

51.8

Euro Session: What to Expect

GMT

CCY

EVENT

EXP

PREV

IMPACT

6:45

EUR

French Industrial Production (MoM) (MAR)

-0.3%

0.3%

Low

6:45

EUR

French Industrial Production (YoY) (MAR)

-1.3%

-1.9%

Low

6:45

EUR

French Central Govt Balance (€) (MAR)

-

-24.2B

Low

6:45

EUR

French Manufacturing Production (MoM) (MAR)

-0.2%

-1.3%

Low

6:45

EUR

French Manufacturing Production (YoY) (MAR)

-2.8%

-3.7%

Low

8:00

EUR

ECB Publishes May Monthly Report

-

-

High

8:00

EUR

Italian Industrial Production sa (MoM) (MAR)

0.1%

-0.7%

Low

8:00

EUR

Italian Industrial Production wda (YoY) (MAR)

-6.2%

-6.8%

Low

8:00

EUR

Italian Industrial Production nsa (YoY) (MAR)

-

-3.5%

Low

8:30

GBP

Industrial Production (YoY) (MAR)

-2.6%

-2.3%

Medium

8:30

GBP

Industrial Production (MoM) (MAR)

-0.3%

0.4%

Medium

8:30

GBP

Manufacturing Production (MoM) (MAR)

0.5%

-1.0%

Medium

8:30

GBP

Manufacturing Production (YoY) (MAR)

-1.3%

-1.4%

Medium

11:00

GBP

BOE Asset Purchase Target (£)

325B

325B

High

11:00

GBP

Bank of England Rate Decision

0.5%

0.5%

High

Critical Levels

CCY

SUPPORT

RESISTANCE

EURUSD

1.2891

1.3000

GBPUSD

1.6076

1.6215

--- Written by Ilya Spivak, Currency Strategist for Dailyfx.com

· May 10, 2012 - 11:07am

The WashPost has this story that they've written. It's useless heresay so they sit on it, waiting for the opportune time to release it.

O'Bottom comes out of the closet yesterday and, magically, the WaPo runs the story today. Certainly collusion or planning to shape the narrative isn't involved here. None at all. 

https://www.washingtonpost.com/politics/mitt-romneys-prep-school-classmates-recall-pranks-but-also-troubling-incidents/2012/05/10/gIQA3WOKFU_story.html

pforth · May 10, 2012 - 11:07am

Trying to think like a bankster--if I had the power to paint the charts and wanted to trick a lot of algos into selling or shorting, I would surely want to make sure that the $26 support line was breached... even if only briefly as that would bring out all the momentum players when they saw the lower low.

BUDDHA PRINCESS · May 10, 2012 - 11:09am

Commodities May Correct Higher as Markets Digest Recent News-Flow

Commodity prices are yielding a mixed performance in early European trade as markets look for the next market-moving catalyst having somewhat absorbed the weekend’s destabilizing political news-flow out of the Eurozone. S&P 500 stock index futures are pointing narrowly higher, hinting growth-geared crude oil andcopper prices may have room to correct higher while the US Dollar pulls back, offering anti-fiat gold andsilver a chance to retrace some lost ground as well.

Risk sentiment may be quick to unravel again however as traders digest the May’s ECB monthly report, which this time around included the quarterly survey of professional forecasters polled by the central bank and considered instrumental to the policy-setting process. Growth forecasts for 2012 and 2013 were downgraded. This year, a deeper recession is now expected, GDP shrinking 0.2 percent compared with 0.1 percent estimated in February. Next year, output is now seen adding 1 percent, down from 1.1 percent expected previously.

Meanwhile, the inflation forecast has been revised sharply higher to 2.3 percent in 2012 and 1.8 percent in 2013 compared with previous bets on 1.9 and 1.8 percent respectively. On balance, this hints at an environment where the ECB will be slow to offer stimulus even as headwinds strengthen, a dismal prospect for overall growth considering the Eurozone is overwhelmingly likely to be the most significant drag on global performance for the foreseeable future.

On the US economic data front, weekly jobless claims data as well as the March set of Trade Balance figures are on tap. Federal Reserve Chairman Ben Bernanke is also due to cross the wires, but the outing may not offer much fodder for price action. Bernanke is speaking at a Chicago Fed conference on efforts to strengthen capital reserves, so the probability that something meaningfully game-changing emerges seems relatively low as traders remain preoccupied with the likelihood of a QE3 program.

WTI Crude Oil (NY Close): $96.81 // -0.20 // -0.21%

Prices continue to grind through support in the 95.78-96.56 area marked by a horizontal barrier in play since early November 2011 as well as the 100% Fibonacci expansion. A break below this exposes 92.51. Near-term resistance lines up at 98.89, the 76.4% expansion.

Commodities_May_Correct_Higher_as_Markets_Digest_Recent_News-Flow_body_Picture_3.png, Commodities May Correct Higher as Markets Digest Recent News-Flow

Daily Chart - Created Using FXCM Marketscope 2.0

Spot Gold (NY Close): $1589.57 // -15.90 // -0.99%

Selling continued after completion of a Triangle chart formation carved out since late March – a setup indicative of bearish continuation – with prices narrowly taking out support at 1591.00 marked by the 50%Fibonacci expansion. The bears now aim to challenge the 61.8% level at 1569.73. The 50% Fib has been recast as near-term resistance, with a push above that targeting the 38.2% level at 1661.75. Longer term, the Triangle pattern implies a measured downside objective at 1548.21.

Commodities_May_Correct_Higher_as_Markets_Digest_Recent_News-Flow_body_Picture_4.png, Commodities May Correct Higher as Markets Digest Recent News-Flow

Daily Chart - Created Using FXCM Marketscope 2.0

Spot Silver (NY Close): $29.21 // -0.23 // -0.79%

Prices are showing a Hammer candlestick following a test of support at the bottom of a falling channel established since early March (now at 28.87), hinting a bounce may be ahead. Initial resistance lines up at 29.71, with a break above that targeting the channel top at 31.04. Alternatively, a push through the channel bottom and 28.70 would expose 27.06.

Commodities_May_Correct_Higher_as_Markets_Digest_Recent_News-Flow_body_Picture_5.png, Commodities May Correct Higher as Markets Digest Recent News-Flow

Daily Chart - Created Using FXCM Marketscope 2.0

COMEX E-Mini Copper (NY Close): $3.660 // -0.018 // -0.49%

Prices are testing support at a rising trend line set from the October 3 bottom, now at 3.644. A bounce sees initial resistance in the 3.696-3.713 area, marked by the October 28 closing high and the 38.2% Fibonacci retracement level, with a break higher initially exposing 3.756. Alternatively, a push through the trend line sees the next layers of support at 3.606 and 3.516.

Commodities_May_Correct_Higher_as_Markets_Digest_Recent_News-Flow_body_Picture_6.png, Commodities May Correct Higher as Markets Digest Recent News-Flow

Daily Chart - Created Using FXCM Marketscope 2.0

--- Written by Ilya Spivak, Currency Strategist for Dailyfx.com

Big Buffalo · May 10, 2012 - 11:09am

Oil goes in the red

Silver goes in the red

Gold goes in the red

This blows.

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Key Economic Events Week of 11/12

11/14 8:30 ET Consumer Price Index
11/15 8:30 ET Retail Sales
11/15 8:30 ET Philly Fed
11/15 8:30 ET Empire State Fed
11/15 10:00 ET Business Inventories
11/16 9:15 ET Industrial Prod and Cap Utilization

Key Economic Events week of 11/5

11/5 9:45 ET PMI Services
11/5 10:00 ET ISM Services
11/6 US Mid-term Election Day
11/8 2:00 ET FOMC Fedlines
11/9 8:30 ET Producer Price Index
11/9 10:00 ET Wholesale Inventories

Key Economic Events week of 10/29

10/31 8:15 ET ADP employment
10/31 8:30 ET Employment Cost Index
11/1 8:30 ET Productivity
11/1 10:00 ET ISM Manu Index
11/2 8:30 ET BLSBS
11/2 8:30 ET Balance of Trade
11/2 10:00 ET Factory Orders

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