Feeling Good, Louis!

315
Wed, Aug 22, 2012 - 4:19pm

OK, now that we've got that FOMC nonsense out of the way, the rallies can continue. How much farther and how fast? Those are the questions.

In case you missed it, the FOMC minutes were QE-bullish. Essentially, The Fed stands ready for more "accommodation" if the economy fails to improve "substantially". You and I know that this is all bullshit, anyway, as The Fed is nearly out of ammo for additional Operation Twist measures and rates must be kept low permanently in order to sustain/protect The Great Ponzi. Again, review this if necessary: https://www.tfmetalsreport.com/blog/4112/murmurs-10-year-note. However, nearly everyone should review that post because the CoT comments contained therein are also important for this current thread.

Anyway, from RanSquawk at ZH, here are three of the main headlines:

  • FOMC says many FOMC members supported extending the Fed late 2014 interest rate guidance, but agreed to defer decision to September meeting

  • FOMC says many FOMC members favored easing soon if no sustained growth pickup

  • FOMC says many FOMC participants saw new QE as bolstering US recovery

  • As you can see, these headlines speak for themselves. More QE is on the way, it's simply a matter of time. The only exception would be renewed, vigorous "growth". Does anyone rally see that happening anytime soon??

    So where do we go from here? After bottoming in May and June, the metals are currently completing a 100-day consolidation and base. From here, we will rally back to the old all-time highs and beyond. Not that there won't be speedbumps and corrections along the way, there will be. However, prices are now headed higher.

    Particularly silver. As mentioned in my CoT comments last week, it appears that the smaller "hyenas" are preparing to battle The Big Dog for silver supremacy. The hyenas correctly sense weakness and smell blood. The fat and lazy Big Dog continues on with business as usual, not knowing yet that it has been mortally wounded. As hyena confidence grows, they will up the pressure by forcing price higher and higher.

    So here are your updated charts. At 1654, gold has clearly broken through the top end of its range and now looks to head toward its next battle, near 1675.

    Silver is still battling to crawl above $30 but it is getting very close. With the FOMC behind us, I expect the hyenas to rage forward tomorrow and press their advantage. This should take silver to and through $30 and serve to draw in some momentum-chasing spec money to aid in the fight.

    And here are two, additional charts for perspective:

    I've mentioned how interesting last week's CoT was, well this week's should be a doozy, too. For the reporting week, gold rose every day, for a total of just over $40, and, prior to yesterday, total OI was down for the week. Again, prior to yesterday. I emphasize this because yesterday, while gold rose $20, total OI shot up by 12,000 contracts (over 3%!). This makes gold CoT data interesting because, clearly, some HOT money returned to gold yesterday in anticipation of today's breakout. But just who are these buyers? Cartel banks or specs? We'll get some answers on Friday.

    The silver CoT will be even more interesting. After the big runup in the "hyena" long position last week, I've been looking forward all week to Friday's report. But now, consider this: For the reporting week, silver was UP $1.68 (6%!) but total OI fell by 1200 contracts. Clearly, to get a 6% move on declining OI, you've got quite a bit of short-covering going on. But, by whom? The SpecShortSheep? The Big Dog? Both? And how many contracts did the hyenas add at the same time? The CoT will shed some light on these questions and I can't wait to see it on Friday.

    In random order, here's some stuff for you to read. First, this from Mark Grant via ZH: https://www.zerohedge.com/news/gathering-storm

    Next, this little ditty that some have posted already into the comments of the previous thread: https://www.mineweb.co.za/mineweb/view/mineweb/en/page32?oid=157430&sn=Detail&pid=102055

    Here are your impending war and destruction updates for today: https://www.zerohedge.com/news/israels-iran-strike-routes & https://www.debka.com/article/22293/Iranian-leaders-in-Israel’s-sights-after-calling-for-its-destruction & https://www.telegraph.co.uk/news/worldnews/middleeast/iran/9490878/Irans-supreme-leader-orders-fresh-terror-attacks-on-West.html & https://www.timesofisrael.com/iran-begins-construction-of-300-million-anti-aircraft-missile-base/

    And here's a fun new piece from Mike Krieger where he discusses the greatness of Bitcoin: https://libertyblitzkrieg.com/2012/08/22/bitcoin-a-way-to-fight-back-against-the-financial-terrorists/

    Lastly, I need your help with something. I spoke with Andrew Maguire earlier today. He and his business partner Paul seem to really like the idea of an "OptionsTrades" service. Her are some random thoughts on the matter:

    1. I'm quite uneasy at recommending options trading to anyone given the inherent risks involved and my oft-stated concerns for the viability of the current "system". After the MFG and PFG debacles, everyone should be wary of holding cash, or anything else for that matter, within the confines of a customer account. That said, I could be wrong. That Ann Barnhart gal could be wrong, too. Maybe MFG and PFG are simply one-offs and everything is fine. I recognize, too, that there are still literally thousands of people worldwide who are still actively trading. Therefore, I'm content to go forward but under the banner of "proceed at your own considerable risk".
    2. I've been trading options for over 25 years now. In my "career", I've always been forced to enter The Den of Thieves armed with nothing but my own experience, wisdom and charts. To think that I could enter again but, this time, have the experience of Andrew Maguire to guide me?...well that is pretty compelling.
    3. After 25 years, I do at least have some idea of what I'm doing. All trades established by Andy and I will only be placed if we are in agreement that the trade makes sense. This clearly doesn't guarantee success but I'd like to think it increases our chances a bit.
    4. It's not going to be cheap but it shouldn't be. First of all, we don't want totally inexperienced traders taking a stab at it simply because the subscription is just $20/month. Additionally, at $250/month, the service would be a bargain. Subscribers would need to maintain an account balance of $15,000-25,000 so we're only talking about a 1-2% monthly vig.
    5. For those that don't trade futures options but do trade equity options, we'll try to offer an alternative ETF option play whenever possible. For example, a Dec12 gold call trade might be matched with a DecGLD call.

    So here's what I need you to do. If you think this sounds interesting and you think you'd be willing to give it a go, please hat tip the first comment below. Since currently only TFMR members can hat tip, any lurker who would like to indicate interest can send me a quick email at tfmetalsreport at gmail dot com. If enough folks show an interest, we'll likely go ahead and set up the system. Thanks in advance for your help.

    As I head out, I see we're still looking good at $1655 and $29.90. Can't wait to see what tomorrow brings!

    TF

    About the Author

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

      315 Comments

    Nana
    Aug 22, 2012 - 10:00pm

    @ Bollocks

    Your so "tasty too" remark reminded me of this.

    Vitameatavegamin Voice Level
    johnnydow
    Aug 22, 2012 - 10:01pm

    Cowboys hitting stops tonight. Can I get 1666.6?

    Wheres the Romney 100 crude commercial? Oh yea, I forgot it was rigged. LOL

    This is going to be painful.

    ¤
    Aug 22, 2012 - 10:01pm

    Asia is awake...

    ...and in a buying mood I see.

    Video unavailable
    ¤
    Aug 22, 2012 - 10:04pm

    Bollocks / Peter Gabriel - Secret World

    I know you are. No problemo'.

    Video unavailable
    ag1969
    Aug 22, 2012 - 10:05pm

    From Harvey

    The only transaction was a tiny 64.3 oz of gold withdrawn from the customer at Manfra.
    However, we had a dandy adjustment from our great friends over at JPMorgan who adjusted out
    200,121,393 oz from dealer or registered gold into customer or eligible gold. This no doubt paid off a prior liability.

    The registered or dealer gold rests tonight at 85.66 tonnes or gold or 2.754 million oz.

    https://harveyorgan.blogspot.com/

    zpring TF
    Aug 22, 2012 - 10:06pm

    Option Trade Newsletter

    The idea is good but the main obstacle is the timing of the alerts.

    Options spread are thin and sometimes liquidity can be limited.

    So the question is how to send an alert that majority of members can fill the trade if they enter within a few hours after the alert?

    How are the alerts being sent - SMS and email are probably the best. Twitter is an alternative.

    Let me know.

    Aug 22, 2012 - 10:10pm
    latcho
    Aug 22, 2012 - 10:13pm

    don't forget this word

    M A R G I N C A L L

    Bollocks
    Aug 22, 2012 - 10:13pm

    @Nana

    "Just like candy"

    sweeeeeeeeeeeeet!

    Aug 22, 2012 - 10:14pm

    Marketplace

    I don't know if any of you ever listen to Marketplace on NPR. (Don't shoot me), but I have followed it for years, mainly cause it helps keeping me from going crazy on my daily commute.

    I just sent them the following message...

    I have been a regular listener for years. In all that time I do not recall any mention of precious metals. Considering what is going on right now, even as I type this, don't you think it about time you at least acknowledge that they exist? How can you claim to be reporting financial news while ignoring what for thousands of years was considered to be the only true money? How much do you wanna bet they don't mention it on the air?

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