The Waffle House

Wed, Jun 6, 2012 - 12:17pm

No, the title isn't intended for those who lacked courage/conviction to hold and buy over the past few weeks. It's simply a reference to where I had breakfast this morning. Just great stuff. Not a better breakfast to be had anywhere on the planet.

Well, we finally got our silver short squeeze today. Very nice to see. As you know, I've been telling you for a while that the spec shorts were being drawn in and set up for a massive short squeeze. Maybe $100 in gold and $3 in silver doesn't yet count as "massive" but it's gratifying, nonetheless. Enough of that, though, the key question now is: Where do we go from here?

From a technical standpoint, gold is ahead of silver as it has been for almost all of 2012. Recall that gold WON its first Battle Royale in late January. From there, it proceeded to rally another $100 before The Forces of Evil stepped in and drove it back down. In classic technical fashion, gold "rode" the Battle Royale line down until it intersected with long-term horizontal support near 1525. Now, having found and solidified a bottom, gold is rolling. It should continue to do so, in stages, until it reaches the line I've called "Battle Royale II", which connects the Labor Day highs of last year with the Leap Day highs of this year. As you can see, BR2 is currently around 1720 but by the time gold catches up to it, it will likely be on the 1700-1710 range.

Even with today's action, silver continues to lag gold. Recall that silver never did win Battle Royale1 back in late February. The Evil Empire allowed for one day of hope on 2/28 before they slammed the door on 2/29. This means that the battle for silver will be two-fold. First, silver must best Battle Royale1. I believe it will do this with much less resistance than it encountered earlier this year. Reason being, the real test will now be Battle Royale II. This line connects the highs of late April 2011 with the Leap Day highs of this year. Battle Royale II currently resides around $34 and will likely be near the always-important $33-level when silver finally encounters it. Once we win Battle Royale II, I will be buying with extreme confidence, every day and on every dip.

So, anyway, this has been a very positive day for the metals. I've been mentioning all week that today would be important as it was the first day back for London after the 4-day weekend. Today's fixes were the first since Friday at 10:00 EDT and it is telling that, even after such a strong paper run-up, demand has been very strong. This has provided the impetus for today's surge higher. Things are looking good here and we should all be encouraged. In the short-term, DO NOT be surprised by a dip/profit-taking that could pull the metals back to 1630 and 29. This would be perfectly natural and set them both up for the next extension toward 1670 and 31.

I'll try to construct a new post later that discusses some of the important events and headlines of the day so please keep checking back.


About the Author

turd [at] tfmetalsreport [dot] com ()


ACM · Jun 6, 2012 - 12:20pm

Happy Silver Investor

Best performing commodity today. Sugar close 2nd.

bellyacre · Jun 6, 2012 - 12:21pm



turkeybucket · Jun 6, 2012 - 12:22pm


and last. And a big thank you for all you do Turd.

Titus Andronicus · Jun 6, 2012 - 12:25pm

Thanks Turd.

Thanks Turd.

SilverHawk · Jun 6, 2012 - 12:26pm

Tim Thomas

Anyone else want to bet he is a Turdite... of not a lurker?

If you're out there, Tim - a big shout out to you! Keep on keepin' on brotha!

achmachat · Jun 6, 2012 - 12:27pm

a beautiful day

we had burgers today for lunch.

it's quite uncommon actually here ;-)

Barth Vader · Jun 6, 2012 - 12:33pm

but why

Once we win Battle Royale II, I will be buying with extreme confidence, every day and on every dip.

Why buy then when you can buy now at way lower prices?

thesandbox · Jun 6, 2012 - 12:41pm

mail just arrived

profile picture updated....even had an appropriate shirt on today when the mailman came to the door. ;) ...maybe next week I can get a shot of it at work at 35,000' ;)

Jakob · Jun 6, 2012 - 12:43pm

The Beauty of Doing Your Own Work

Turd, thanks for the charts today. I can't appreciate enough the importance of looking up the TA of others and doing it myself. Making my own chart in mid-March really helped me realize that this was a year to hold​ and perhaps ​buy, but not sell. This gave me the intestinal fortitude to hold off on the panic button the last few months.

If you don't do any of your own charts. I recommend trying it some time. Build yourself a long-term technical guesstimate. You will probably mess up and miss a target once in a while, but it's better than letting your emotions take over.

SRSrocco · Jun 6, 2012 - 12:43pm



The FED is caught in a very bad situation. First, it must keep buying US Treasuries or the rates will rise. Second, if it continues to do so, the US DEBT increases. Third, the INTEREST ON THE DEBT is a BOMB waiting to go off . If we look below we can see the annual interest amount on the US DEBT:

Available Historical Data Fiscal Year End
2011 $454,393,280,417.03
2010 $413,954,825,362.17
2009 $383,071,060,815.42
2008 $451,154,049,950.63
2007 $429,977,998,108.20
2006 $405,872,109,315.83
2005 $352,350,252,507.90
2004 $321,566,323,971.29
2003 $318,148,529,151.51
2002 $332,536,958,599.42
2001 $359,507,635,242.41
2000 $361,997,734,302.36

Below is the month of APRIL 2012:

According to the current trend from OPERATION TWIST, the interest expense for 2012 will be lower than 2011, due to much lower 10 Year & 30 Year rates. If the FED did decide to not continue with an OFFICIAL QE3, the rates on US TREASURIES would increase and the interest on the debt could double quickly... which would mean almost a $TRILLION annually just for interest payments on the debt.

DR G... are you happy today to see SILVER up in that 1.5-2 TIMES range compared to GOLD?

We have to wait and see if BERNANKE tells the world tomorrow that further EASING or ASSISTANCE from the FED is coming. If not, it could all reverse tomorrow. That being said, the FUNDAMENTALS for GOLD & SILVER haven't been better.

DENNIS your heart out

dropout · Jun 6, 2012 - 12:43pm

Thank you TF

Fully agree with your post and charts.

Your "Battle Royal" levels coincide with 'break out' targets that I am currently looking at;

Gold at $1,710.00 and silver at two break out points at $33.10 then at $34.50

Until those levels are breached, the cork stays in the 'bubbly' bottle! 

Again, thank you for all you do. TFR is far away one of best sites on the net for metals news and views.

humbleprofits · Jun 6, 2012 - 12:43pm

Turd, how do you like 'em?

The hash browns that is? Scattered, smothered, covered or all the way? Hard to find better greasy eats.

SV · Jun 6, 2012 - 12:48pm

Nice Pop in Asia!

AG started in Asia while the Morgue was sleeping!

Really- · Jun 6, 2012 - 12:48pm

Great day for DOW and PMs a WIN/WIN!

Michael · Jun 6, 2012 - 12:51pm

Long time coming, gonna be a long time gone...

I don't post often, though this is one of my very favorite places to watch with all the brilliance, character, and characters around here. But I haven't a lot to offer 'cause I've been mostly selling, not stacking. See, I went all in a long time ago. So I'm living off my old stack, and when gold got over $1200 my kids and my Mom (and I don't really mind) took some advantage of my generosity. So I'm getting toward the very bottom of my gold stack and I hate parting with the ounce or two to get me through the months.

The good thing is that I also got all in on silver, and when I have to find the stuff I lost at the bottom of the lake it might also help get me through the months when the provisions are low.

Y'know, I cannot remember the pleasure of ever being "FIRST" here on Turd's blog, but consistently - and always - I am "LAST!"

Ol' Michael

" is money and paper is paper..." - Thomas Paine

Maryann · Jun 6, 2012 - 12:52pm

Can I just say....

I almost love the pecan waffles as much as PMs.......smiley

Eman Laer · Jun 6, 2012 - 12:53pm

Seen this from ZeroHedge?

The CBO Will Need A Bigger Chart To Forecast Exponentially-Rising US Debt

Courtesy of previous Zero Hedge disclosures, namely that the CBO has been in the past both perpetually and grossly over optimstic (their 2001 forecast of 2011 public debt was negative $2.4 trillion; instead the real number was positive $10.4 trillion, a delta of only $12.8 trillion) as well as explicitly biased by political and financial interests as exposed by whistleblowers, are two things most of our readers are well aware of. What they however may not know, is that when it comes to the most recent forecast of US public debt as released hours ago, the CBO has officially run out of charting space. As can be seen on the graphc below,sometime in 2042 the CBO will need a bigger chart to represent US public debt as per the Extended Alternative Fiscal Scenario, which the CBO itself admits "
is more representative of the fiscal policies that are now (or have recently been) in effect than is the extended baseline scenario." And it is to this off-the-chart line that Keynesian lunatics want to add MORE debt? Actually why not, it is not as if the US will ever repay any of these exponentially-rising obligations.

Eman Laer · Jun 6, 2012 - 12:54pm

Whoever named them was dyslexic


bern SRSrocco · Jun 6, 2012 - 1:05pm

SRSrocco - Fed won't signal QE tomorrow

They have another meeting later in the month (the 20th IIRC). I expect an announcement then if they are going to do it.

ivars · Jun 6, 2012 - 1:05pm

Here comes a pullback in

Here comes a pullback in silver, I think. Missed 50 day MA by 10 cents.

Dr G · Jun 6, 2012 - 1:06pm

@SRS, I'm very happy. In the

@SRS, I'm very happy. In the previous thread I posted a chart and acknowledged that you were correct. Search for it. But as Turd said, silver is not out of the woods yet. It may not have even entered the woods. Caution is warranted (stackers should keep stacking) against emotion.

Metals will move tomorrow. No sideways action. It's either up or down tomorrow.

Mudsharkbytes · Jun 6, 2012 - 1:10pm

Waffle House

One of my overall favorite places to eat.

I especially like their chili (Barts?) either a big bowl of it, or slathered all over their hash browns, along with some jalapeños. 

Anybody who calls it "Awful House" is missing the point. They produce consistently good food for a reasonable price. I've never been disappointed with one, and that's not an easy thing to say about any franchise. Turd praising the WH has upped my respect for him, not that I didn't already hold him in high regard.

Wish I felt the same confidence in silver as I feel towards WH. I keep thinking the kick-in-the-nuts waterfall is poised to happen at any moment.

SRSrocco · Jun 6, 2012 - 1:12pm


Regent ousted as Barrick CEO

Barrick Gold said Wednesday it has replaced CEO Aaron Regent because of the company's poor share price performance

Posted: Wednesday , 06 Jun 2012 

TORONTO (Reuters) - 

Barrick Gold said on Wednesday its board has reshuffled its top management team and replaced its chief executive, Aaron Regent, citing disappointment with the company's share price performance.

Shares of Barrick, the world's largest gold miner, has changed little over the last few years despite a surge in the price of bullion during that time.

The Toronto-based miner has appointed Executive Vice President and Chief Financial Officer Jamie Sokalsky as its new president and CEO, replacing Regent


Looks like Barrick may be having more trouble than just their SHARE PRICE.

schnitzel · Jun 6, 2012 - 1:14pm

The pull back

I was wondering if my silver miner's were signaling a pullback. They are actually down today, hopefully it doesn't mean a silver smash.

balz · Jun 6, 2012 - 1:19pm

Tipping hat for SRSrocco

Hat tip if you tip hat SRSrocco's posts before reading them because you know they're always great !

Mickey · Jun 6, 2012 - 1:20pm
aomegaa · Jun 6, 2012 - 1:20pm


Anyone know where to get real time HUI quote?

Thanks in advance.

Cottonbelt21 · Jun 6, 2012 - 1:21pm

Contagion ...

... not familiar w/author (or Canadian Maison Placements) but good overview as both bullion & the miners grind higher

 Greek Mythology Cartoon

TomMack · Jun 6, 2012 - 1:21pm

new contest??

Since the last Ag>FB was so quick we didn't really have any time to enjoy it, how about when silver is double FB? 19/38my guess?? Anyway feeling pretty good/smart about PMs right now. I think TPTB have a lot of distractions right now so the metals market may be less 'encumbered' than usual.

Groaner · Jun 6, 2012 - 1:25pm

Yup, the good old cartel smack down to get a low

closing price.. They cant have too much interest in the metals now can they???

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