Gold and Silver Fun and Games

234
Wed, May 23, 2012 - 4:00pm

This is just getting to be far too predictable.

Let's see, first it was the April12 gold. Then it was the May12 silver. Today it was the June12 gold. What do I mean? Today was, once again, one day prior to option expiration and today, once again, we get a round trip in the metal as the poor losers who are left trading and hedging get their arses handed to them by the controlling powers of The Cartel.

As a refresher, what we saw in March and April, we saw again today. Namely, the handful of poor saps who had sold put options on the front month, thinking they had free money (Wouldn't you have thought that selling the June 1550 put looked like a safe bet back in February? Heck, maybe even late last week?) Lo and behold late yesterday, with just two days left before expiration, gold gets smoked on the Globex and is driven below its 10-day MA. WOPR selling ensues and before you know it, gold is near 1550 and headed lower. YOU, the poor sap that is short 100 June puts, have no other option but to sell short 100 June12 contracts, just to hedge yourself. Your selling (and everyone else caught in the same vise) sends gold even lower, toward 1535. All of this selling is gladly soaked up by The Cartel until...snap, boom, bang...they spring the latch on the trap and begin rallying gold back higher. Your new short hedge is suddenly squeezed and you eventually cover. This is particularly likely once price rallies back through and above that personally dangerous 1550 level. With gold back at 1560, you are now left with your original 100 naked puts that will expire worthless at 1:30 tomorrow as scheduled, however, you were just lightened of some considerable funds by the coercive, manipulative power of The Gold Cartel. Wash, rinse and repeat next month in July silver if prices continue down at these levels.

The selling of yesterday and today has established the basing/trading ranges that we began to discuss here yesterday. See this for a refresher: https://www.tfmetalsreport.com/blog/3818/not-so-happy-tuesday Of that post, this line in particular is the most relevant:

"Now, please don't misunderstand what I'm telling you here. I'm still extremely excited about where the metals are headed, particularly silver. The ranges I've described above are for the short term, maybe the next week or two and into early June."

Here are your charts that show these new ranges:

Here are some other nuggets that I've picked up as I've gone through the day. First, Jesse had this little ditty about KosherDakota who, as you know, is one my favorite Fed douchebags. This guy is a complete clown. Anyway, the speech Jesse references is not the first time KD has muttered this current bit of nonsense. I actually saw a headline on ZH about a week ago where this buffoon said the same thing that he said today. I was going to write about it at the time but by the time I doubled back to C&P it, the ticker had moved on. At any rate, enjoy the nonsense. https://jessescrossroadscafe.blogspot.com/2012/05/feds-kocherlakota-i-reject-your-reality.html

Trader Dan has a good comment today on commodities, in general. He also made an appearance on KWN. I highly recommend both: https://www.traderdannorcini.blogspot.com/2012/05/continuous-commodity-index-fed.html & https://kingworldnews.com/kingworldnews/KWN_DailyWeb/Entries/2012/5/23_Norcini_-_Central_Bank_Gold_Buyers_Battling_Hedge_Funds_Today.html

If you haven't yet, you should speed through this. I often listen to Coast-to-Coast as I'm shuttling LT#1 back and forth to ballet class. I caught part of this episode the other night. The stuff with Peter Schiff is definitely pertinent and well worth your time.

Video unavailable

And this is interesting. With the FB/silver spread now at just $4 or so, can the closure of the latest Hat Contest be very far away? https://www.marketwatch.com/story/how-facebook-could-destroy-the-us-economy-2012-05-22?pagenumber=1

Have a great evening! TF

About the Author

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turd [at] tfmetalsreport [dot] com ()

  234 Comments

Leprechaun
May 23, 2012 - 4:04pm

A bit of light at the end of

A bit of light at the end of the tunnel... thanks Turd.

OrangeAlert
May 23, 2012 - 4:11pm

"Turd"

Thurd, whatever you want to call it.

rl999
May 23, 2012 - 4:14pm

More manipulation

"Capitulation, or the Apex of manipulation? NetDania’s 1 hour silver chart indicates 105,231silver contracts were dumped on the market this morning between 9am and 10am EST, as silver was smashed a dollar from $28 to $27.

To put this number in perspective, 105,231 contracts is north of 500,000,000 ounces of silver, nearly 2/3rds of entire world annual silver production trading in a single hour!"

Link:

https://www.silverdoctors.com/were-500-million-ounces-of-paper-silver-ju...

TheGoodDoctor
May 23, 2012 - 4:16pm

I just wonder what it will

I just wonder what it will look like when things finally blow.

silverstax
May 23, 2012 - 4:16pm

Holy smokes !!

I didn't have a first in over a year and now 2 in one day?! Come on guys, someone tag in!

On a much more serious note, Turd mentioned on the last thread that the end is closer than we think. I'd love to hear everyone's prognostications on how much time we have left.

Greece, Italy and Spain aside, the JPM and now Facebook scandals certainly aren't restoring any confidence.... with each passing day it feels more and more that things are about to come to a head. I think we have a month at worst, a year at best before there is some sort of major event. My gut feeling is that it will happen before the end of this year, possibly the end of the summer.

SV
May 23, 2012 - 4:17pm

bbb

bbb

CaribSurfKing
May 23, 2012 - 4:17pm

Wow, HUI and XAU rocket ship this afternoon...

Somebody must know PM's are going higher!

10% move in an index in 5 hours!!!

SV
May 23, 2012 - 4:19pm

Silver Vigilantes Taking on TheMorgue!

Look at the desperate banktards doing what they can to keep the precious metals down so that their fiat oblivion can be maintained over their victims!!! The Silver Liberation Army is gonna bring this paper system down to its knees!

https://silvervigilante.com

Roger Godberd
May 23, 2012 - 4:28pm

Turd nailed it

You know Turd, I sat there yesterday thinking the same thing (ish)...and today was even worse. The naked affrontery of it it all. Bare faced larceny.

It is incredible to behold.

Perhaps I am late to the party but I have now concluded these are not markets which can be traded. Doh!! Finally I hear you all shout. Nonetheless I still have a position in the red and so will be trying to trade out.

GL all with your endeavours. Thank goodness I have kept stacking too even if it is only Sterling silver cutlery!!!

rock collector
May 23, 2012 - 4:30pm

"I'll Have Another"

Most miners in the green today!

GG showing real signs of life, up 6.78% today. Whew!

I'll Have Another" indeed!

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