An Unusual Week Ahead

293
Mon, Jul 2, 2012 - 10:00am

It's going to be a weird one. A big up day last Friday. CoT Tuesday is ahead of a market-closed Wednesday and then Friday is the next BLSBS report. All in all, it's very hard to predict what will happen. You know what that means don't you? Another hat contest!

First of all, today will likely be flat-to-down. As Ranting Andy likes to point out, The Cartel rarely/never allows a second UP day after a big move. So far, that's about how things are playing out. Gold is down $5 and silver is unch, both on light volume.

Tomorrow is CoT Tuesday and the last trading day until Thursday (American Independence Day is Wednesday). You'll recall that Friday, June 1 was a $58 UP day. Monday, the 4th was down $8 and CoT Tuesday, the 5th was up $3. Does this gives us any clues following last Friday's $54 UP day? Yes and no. Yes for today, tomorrow not so much because of the Wednesday holiday.

I would expect a bit of an UPward bias on Thursday ahead of the BLSBS. Why? To me, there's a pretty strong likelihood that the BLSBS on Friday is going to be a stinker. Last month was +69,000 and this was only because of a 200,000+ birth/death adjustment. Given the economic data since and the uncertainty surrounding the Obamacare SCOTUS decision, the odds to seem to favor a very light number. Something less than 50,000? I can almost hear Hampton Pearson now: "UP 27,000. Non-farm payrolls for June were up just 27,000". We'll see.

So, if this plays out, there's a chance the charts could turn quite positive by this time next week. Maybe gold will be near the top of its 1530-1630 range? With a real dud of a BLSBS, maybe it will be out and UP through the range, something like 1650? And maybe silver can get going, too. The chart would seem to indicate that it will be trapped all week between maybe 26.50 and 28. This wouldn't surprise me at all. Then, with a lousy BLSBS, silver blows through the downtrend line off of the 2/29 highs and begins a run at 30 and points north.

So, let the contest begin! Once again, we'll need some help compiling the guesses so anyone out there with a few spare minutes could really help the cause. The contest will close at 6:00 EDT (NY time) tonight. For determining the winner this time, let's use the kitco charts on the homepage. When the metals stop trading on Friday, the final spot price will be shown on those charts. We'll use those prices to determine the winners. One hat for gold and one hat for silver.

Good luck everyone and have a great day!

TF

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  293 Comments

rl999
Jul 2, 2012 - 10:10am

UK manfacturing contracts again, stimulus to come.

"The country fell back into recession around the turn of the year and a string of weak economic data has pointed to another quarter of contraction between April and June, putting pressure on the central bank and the government to boost growth.

The Markit/CIPS closely watched Purchasing Managers' Index (PMI) rose to 48.6 last month from May's three-year low of 45.9, beating expectations for a more modest climb to 46.5. But it was still the second month below the 50 mark that divides growth from contraction.

"These figures imply that manufacturing was a drag on overall growth in the second quarter and we expect GDP to decline for the third consecutive quarter," said Nida Ali, economist at Ernst & Young ITEM Club. "The Bank was already leaning heavily towards extending QE this week and these figures will provide further pressure," she added.

The Bank is expected to top up the 325 billion pounds of cash it has already pumped into markets with another 50 billion when it meets on Thursday as falling inflation gives it more scope to support the battered economy.

Britain's economy contracted 0.3 percent in the first three months of the year and having shrunk at the end of 2011 is deemed to be in recession.""

https://uk.reuters.com/article/2012/07/02/uk-poll-uk-factory-idUKBRE8610C...

Himalaya
Jul 2, 2012 - 10:11am

from KTM

Gold = 1540.20

Silver= 27.10

Be Prepared
Jul 2, 2012 - 10:12am
achmachat
Jul 2, 2012 - 10:13am

yay for contests!

my guesses:

Ag: 28,34

Au: 1634

murphy
Jul 2, 2012 - 10:14am

you talking to me

You talking to me?

28.20

1624.80

Be Prepared
Jul 2, 2012 - 10:14am
rl999
Jul 2, 2012 - 10:14am

I will compile guesses

Mine are

Ag ~ 27.12

Au ~ 1589.7

¤
Jul 2, 2012 - 10:15am

Good morning...

...and thanks for the update.

Have a great day!

Lousy PMI number this a.m. Below 50

~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~

Manufacturing sector contracts in June: ISM

NEW YORK | Mon Jul 2, 2012 10:07am EDT

NEW YORK (Reuters) - The U.S. manufacturing sector unexpectedly contracted in June for the first time since July 2009 as new orders tumbled, according to an industry report released on Monday.

The Institute for Supply Management said its index of national factory activity fell to 49.7 from 53.5 the month before, missing expectations of 52.0, according to a Reuters poll of economists.

A reading below 50 indicates contraction in the manufacturing sector.

New orders dropped to 47.8 from 60.1, while the employment gauge slipped to 56.6 from 56.9.

https://www.reuters.com/article/2012/07/02/us-usa-economy-manufacturing-...

El Gordo
Jul 2, 2012 - 10:15am

Hat winning numbers

Gold = 1610.10

Silver = 27.90

murphy
Jul 2, 2012 - 10:15am

P4

Hey- nice to see you. Looks like we are on the same hat seeking page.

Bsong
Jul 2, 2012 - 10:16am

Gold 1650 Silver 28.73

Gold 1650

Silver 28.73

¤
Jul 2, 2012 - 10:16am

rl999

Thanks!

Fr. Bill
Jul 2, 2012 - 10:17am

My hat contest guesses ...

Gold - 1598.87

Silver - 27.85

Be Prepared
Jul 2, 2012 - 10:18am

My Turd Hat Cometh...

Gold: 1608.20

Silver: 27.89

tpbeta
Jul 2, 2012 - 10:18am

OK

Feeling optimistic. Will break up then go back down a bit.

Silver 28-30

Gold 16-15

TomMack
Jul 2, 2012 - 10:19am

guess

gold....1620.93

silver 28.03

So It Goes
Jul 2, 2012 - 10:19am

Au and Ag

Au = 1625

Ag = 28.00

Be Prepared
Jul 2, 2012 - 10:21am
NW VIEW
Jul 2, 2012 - 10:22am

guess

Silver =$ 26.51

Gold = $1533.50

Be Prepared
Jul 2, 2012 - 10:22am
Excalibur
Jul 2, 2012 - 10:23am

Fire and storms

Thoughts for anyone here who is affected by the storms, record temperatures and fires in the US. I saw that Mike Krieger was on evacuation alert in Boulder. It looks extreme. I hope you, friends and family are safe.

(From the wet and dull UK).

sevin
Jul 2, 2012 - 10:24am

First

Holding my spot

Edit: This past weekend I went over to a friends house who was having a small Brazilian cookout and I knew everyone there except this older man who appeared to be around 55 or so. The rest of the crowd was below 40 so it seemed odd he was there. He mostly kept to himself while everyone was eating appetizers outside and but when he went inside to talk with one of the ladies he started talking about Obamacare and the economy. People went in and out of the house to grab something to drink and quickly came back out only to say that this man wouldn't stop talking about the economy and such.

Right before it was time to eat everyone piled inside to get there food when he proposed this question: "Why doesn't the government just give a $1 million check to everyone in the country?"

Most people thought this would be great idea as they could go out and buy new things for themselves and what not. He just sat back and smiled at every answer until I said that it would be a terrible idea to just increase the money supply like that because the currency would be quickly depreciated and the prices of goods would skyrocket. He spoke decent English, but understood every word I said. We went on to talk about previous events of hyperinflation and how we could see it playing out in the United States. He was very clear in his statement that people need to invest in hard assets (especially silver, gold, and real estate) as soon as possible because it isn't going to end well for the United States.

We talked for at least thirty minutes and everyone thought I was nuts for talking to this guy that everyone else was annoyed of. He was an economics professor at FSU for years and he seemed like he a could have been a Turdite! He clearly knew what was going on and everyone else there at the party seemed as if they sheeple ready to get slaughtered, but thanks to this community for all of the great knowledge it provides some more people have been awakened!

Boggs
Jul 2, 2012 - 10:24am

Hat

Gold - $1,588.20

Silver - $27.42

ag4me
Jul 2, 2012 - 10:25am

wild guess

Ag-$26.82

Au-$1544.21

Chicken Little
Jul 2, 2012 - 10:25am

My Hat Size Is Medium.

Ag = $26.97

Au = $1574.54

ggnewmex
Jul 2, 2012 - 10:27am

Good work Turd

I would have to GUESS that the need for fiat for the functioning of the government would mean the cartel needs to start from a lower price, therefore, I would expect a lessening of price, UNFORTUNATELY, however, I need to roll some 401k money, so I am hoping for a lesser price to buy MORE!!!

Gold 1568.25

Silver 26.86

ALl the best

GG

Lumpy
Jul 2, 2012 - 10:27am

Just go ahead and send me the hat.

Silver $29.87

Gold $1,666.78

rl999
Jul 2, 2012 - 10:28am

Palestinian Authority short 100M

(Emphasis mine. The last paragraph strikes me as being quite similar to the way the SWIFT sanction has played out. A threat that will turn out to be much more consequnetial to the US and it's allies then it's "enemies". We have undermined Israel's security and potentially elevated HAMAS to a new level on the playing field.)

The Palestinian Authority may be in danger of collapse. In the midst of a financial crisis that is threatening its ability to function, it has now been refused a $100 million bridging loan via Israel from the IMF...

As the Palestinian Authority is not a state, it cannot technically apply for an IMF loan on its own. In order to circumvent the problem, Israel applied for the IMF loan on the Authority’s behalf, planning to forward the money directly to the PA. The PA would then in turn repay Israel, who would then repay the IMF. However, the IMF felt compelled to refuse, based on the grounds that it did not want to set a problematic precedent for loans by proxy.

“What is available to the Palestinian Authority at the moment in terms of funds is not enough to pay government employee salaries this month, with Ramadan approaching. It is not sufficient to pay the bills that the Palestinian Authority owes to private companies,” said Minister Ahmad Majdalani...

"Netanyahu is interested in preventing a situation whereby the PA collapses financially, which is liable to have a very negative impact on the West Bank security situation," a senior Israeli official said...If the Palestinian Authority is unable to function, governance of the West Bank and Gaza would likely pass to Hamas, who won broad support in the Gaza Strip in the 2006 Palestinian legislative elections much to the chagrin of the US and Israel.

The majority of PA aid has traditionally come from the United States, the European Union, and Arab nations.

The PA’s liquidity problems began as early as September 2011, when President Mahmoud Abbas defied US stipulations on aid by announcing a bid for statehood at the UN. Arab nations have been unable to provide monetary support for the Authority due to the financial crisis, and US aid has been either stifled or frozen after the Abbas’ statehood bid.

Be Prepared
Jul 2, 2012 - 10:28am

U.S. Economy Preview..

Hiring Probably Cooled in Second Quarter: U.S. Economy Preview

The jobs tally in June probably crowned the weakest quarter for employment in more than two years, evidence the U.S. recovery has lost momentum, economists said before reports this week.

Employers increased payrolls by 90,000 workers last month after a 69,000 gain in May, according to the median forecast of 59 economists surveyed by Bloomberg News ahead of Labor Department figures due July 6. Excluding government agencies, private hiring may have climbed by 100,000, concluding the smallest quarterly advance since the first three months of 2010.

The job slump has shaken confidence and stalled household spending, which accounts for about 70 percent of the economy, making the expansion more susceptible to any fallout from the European debt crisis. Slowing consumer and global demand is also leading to a cooling in manufacturing, a mainstay of the recovery, another report this week may show.

“We really need to see job creation pick up, which is the only thing that’s going to get households spending on a sustained basis,” said Paul Dales, a senior U.S. economist at Capital Economics Ltd. in London. “The economy isn’t going to get exceptionally weak from here, but neither is it going to get much stronger.”

The unemployment rate, derived from a separate Labor Department survey of households, probably held at 8.2 percent, the economists predicted. Joblessness has exceeded 8 percent since February 2009, the longest stretch in monthly records dating to 1948. <Rest of the Article>

Daedalus Mugged
Jul 2, 2012 - 10:28am

1585 27.15 My hat size is

1585

27.15

My hat size is ginormous, just on the off chance I get lucky.

Unfortunately, I don't get lucky.

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Key Economic Events Week of 4/15

4/16 9:15 ET Cap Util and Ind Prod
4/17 8:30 ET Trade Deficit (Feb)
4/17 10:00 ET Wholesale Inventories
4/18 8:30 ET Retail Sales (March)
4/18 8:30 ET Philly Fed
4/18 10:00 ET Business Inventories (Feb)
4/19 8:30 ET Housing Starts and Building Permits

Key Economic Events Week of 4/1

4/1 8:30 ET Retail Sales (Feb)
4/1 9:45 ET Markit & ISM Manu PMIs
4/1 10:00 ET Construction Spending (Feb)
4/1 10:00 ET Business Inventories (Jan)
4/2 8:30 ET Durable Goods (Feb)
4/3 9:45 ET Markit & ISM Services PMIs
4/5 8:30 ET BLSBS

Key Economic Events Week of 3/25

3/26 8:30 ET Housing Starts (Feb)
3/27 8:30 ET Trade Deficit (Jan)
3/28 8:30 ET Q4 GDP final guess
3/28 10:00 ET Pending Home Sales (Feb)
3/29 8:30 ET Personal Income (Feb)
3/29 8:30 ET Consumer Spending and Core Infl. (Jan)
3/29 9:45 ET Chicago PMI
3/29 10:00 ET New Home Sales (Feb)

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