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

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    turd [at] tfmetalsreport [dot] com ()

      315 Comments

    ivars
    Aug 23, 2012 - 11:13am

    DPH

    The rate of increase of US debt has slowed in 2012. That is what was expected here in this prognosis chart made in October 28, 2011:

    https://www.tfmetalsreport.com/comment/521025#comment-521025

    due to its own pattern development prior to crash. However, this is just a slowdown before the final acceleration to partial default in late 2015 early 2016 ( this is the earliest and so far most stable version, I have another that is if I remember right with partial default 1,5 years later).

    However, as You can see in the chart, debt growth has to accelerate now ( internal dynamics of a system called the USA empire). What are the options how to achieve it?

    Fiscal cliff- no way, that slows debt growth down

    Just recession- could be, but not guaranteed as may be lacking popular support to go deeper in debt when austerity might be a forced option

    War with Iran- sure thing to accelerate debt. So, its quite likely for a war ( given the uncertainty in the chart which is about +- 3 months, (if we compare todays debt to what i predicted last year, it will reach 16 trillion some 3-4 months earlier) , so the war will start between October 2012- March 2013. For sure. Most likely before or just in the beginning of 2013 (as chart is delayed relative to what happens in practice.

    How would that affect PMs? Increasing debt supports PM price growth, initial was activities may cause some correction.

    P.S. it will not be a world war nowhere soon. Forget about world wars until 2020 or later. But it will plant another seed.

    P.S.2- you do not change horses during the race. B.Obama.

    Prize Fighter
    Aug 23, 2012 - 11:14am

    Electric Boogaloo....lmao.

    Electric Boogaloo....lmao.

    Patrancus
    Aug 23, 2012 - 11:15am

    just a thought on military hardware

    military hardware is likely to come into review if a conflict erupts in Iran as the TOR air defense system gets run through its paces hunting for targets in the skies over Iran, probably would be the most popular show over in the old soviet military bunkers. If TOR does what it is engineered to do, it could be a turkey shoot, if not, then the big dog will still be standing, and his rein will continue to support his actions to print and distribute his paper notes around the world.

    ¤
    Aug 23, 2012 - 11:17am

    Ivars / Tungsten Gold

    Thanks for the feedback Ivars.

    I like what you had to say there and it's what's after Iran that has my attention. There is no way but up for future US debt and we're way past the point of no return. The Pol's are in denial about it publicly but I think they realize it also and are just trying to manage the tone of it (MOPE).

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

    I see Tyberious posted some Jim Willie last night (Thanks Ty!) and in it he mentions the tungsten gold scenario he believes is going on right now. I don't know if JW has written on it before and what I wrote last week were my own thoughts on what might happen.

    He seems to believes that it's already happening. Maybe so. I think something is definitely afoot and the silence on it is deafening at this point imho. I think eventually (1-2 years max.) that it will be the talk of the town/world.

    "Why Tungsten Gold Is Necessary & Tolerated"

    https://www.tfmetalsreport.com/comment/118486#comment-118486

    OrangeAlert
    Aug 23, 2012 - 11:17am

    Prize Fighter

    At least one person got it. Everything with a 2 is followed by Electric Boogaloo at my house. Just because it's funny.

    Fired
    Aug 23, 2012 - 11:18am

    Re: smackdown

    Always better to be psychologically prepared and for it not to happen than be living in ignorant bliss and disappointed if it does. Retest happens.

    BTW, I notice that the Pig is falling and I think its below the lower support line from last year now.

    Nana
    Aug 23, 2012 - 11:18am

    CCR- Up Around The Bend seems fitting

    Creedence Clearwater Revival - Up Around The Bend
    ivars
    Aug 23, 2012 - 11:18am

    Sapo's

    Sapo's joint:https://saposjoint.net/Forum/index.php

    For those who sometimes visit that site where I come from and post at - its down with disk failure, may take time to restore.

    a_guy_in_hainesville
    Aug 23, 2012 - 11:21am

    bulliondirect missing gold asks

    I have never seen that before. Silver is still showing offers on all their stuff.

    I just thought that is interesting.

    SaratogaPrepper
    Aug 23, 2012 - 11:24am

    New Thread

    New Thread.

    Hi Ho Silver! 'toga needs more preps.


    Aug 23, 2012 - 11:24am

    GM3000

    Watch it.

    You know better than to respond like that.

    ratioarbitrage Byzantium
    Aug 23, 2012 - 11:25am

    @ Byzantium - agree

    Absolutely right. Each player will playing to cover their own weaknesses. I am going to ruminate a bit more on your idea of a Eurasian alliance, and what economic form it might take, remembering that trust may well be in short supply in the next 10 years and that nothing is enforceable except by the idea of mutual benefit/need.

    Prize Fighter
    Aug 23, 2012 - 11:25am

    OrangeAlert

    Anything which reminds me of Jamz, pac man, Friday night roller skating, break dancing or parachute pants gets a hat tip from me.

    "Freakazoid robots, report to the dance floor."

    Midnight Star "Freak-a-zoid"
    GoldMania3000
    Aug 23, 2012 - 11:44am

    @GoldMania3000: Camo Utils

    I could not help but notice the camo utilities those swabbies were wearing. WTF? camo on a ship? Back in the day, during Vietnam, I was stationed at Little Rock Airforce Base in Jacksonville, Arkansas. We were strictly prohibited from wearing fatigues off-base unless we were driving to or from base if we lived in town. If we were seen in fatigues off-base we were subject to an Article 15 and a fine.

    These days I see arm-chair warriors walking around DC in camo. I believe I've heard wearing utilities is REQUIRED in public. It's as if the only image the military wants to convey now is all military personnel are grizzled front line vets.

    It makes me sick the extent to which American society has become militarized and how we've come to regard military people with almost god-like awe.

    When some wannabe Napoleon like David Petraeus comes striding in on a white horse to "save" America people are going to eat it up.

    Keep stacking!

    Fired Puck Smith
    Aug 23, 2012 - 12:15pm

    Puck: Camo in public

    Getting people used to the fact of perpetual war. I wonder if FEMA has camo gear now?

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