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

      Refresh
    Bollocks
    Aug 23, 2012 - 9:27am

    @ Cornhole

    You said "preponderance"

    How dare you! I've had enough of your s*it, now shut it.

    ag1969
    Aug 23, 2012 - 9:23am

    Big L

    It was a joke, lighten up. My apologies to anyone who read my comment and believes that I actually condone hitting your mother, or anyone else for that matter, with a brick. It was a metaphor ( and obviously a failed metaphor ) for the fact that I can't believe that with the preponderance of evidence, people are still not woken up to what is going on, including my own mother.

    @ superduper, I apologize if my veiled attempt at humor was offensive to you. I certainly did not mean to be soooooo ugly that I get kicked off the site, but if Turd decides that my comments are so ugly that people are actually leaving his site, so be it.

    I guess I will finish by saying that if people are so offended by me that 1 sentence can evoke such a dramatic response, I should probably be banned from posting here anyway. Wow! Touchy, Touchy.

    treefrog
    Aug 23, 2012 - 9:21am

    a little ray of (rotten) sunshine

    The Solar thing just got a little more interesting.......REALLY!
    The Tonopah Solar Company in Harry Reid's Nevada is getting a
    $737 million loan from Obama's DOE.
    The project will produce a 110 megawatt power system and employ
    45 permanent workers.
    That's costing us just $16 million per job.
    One of the investment partners in this endeavor is Pacific
    Corporate Group (PCG).
    The PCG executive director is Ron Pelosi who is the brother to
    Nancy 's husband.

    Bollocks
    Aug 23, 2012 - 9:20am

    even higher now

    this HAS to be too fast...

    Bollocks
    Aug 23, 2012 - 9:19am

    30.66

    shit!

    Bollocks
    Aug 23, 2012 - 9:17am

    @Big L

    I've known the poster of that for some time, at a different forum. He's smart, very tongue-in-cheek and funny as hell. You got the wrong end of the stick there sir.

    treefrog
    Aug 23, 2012 - 9:15am

    $30.50

    like a ratchet, clicka - clicka - clicka.......

    $30.60 - clicka - clicka.....

    GoldMania3000
    Aug 23, 2012 - 9:12am

    are we still expecting?

    Some big news on the silver front that is going to take us to new highs. How close are we?

    Big Buffalo
    Aug 23, 2012 - 9:11am

    $30.50

    this is going to be interesting. Lets see if a breakthrough happens or a beatdown.

    TexasStacker
    Aug 23, 2012 - 9:11am

    @bigL

    One thing about the internet, and electronic communication in general, is that subtle nuances sometimes get missed.

    I took/take no offense to the brick comment. I think it was meant as idiom (?right word?) like "I'm so hungry I could eat a horse." If I saw that comment I wouldnt notify PETA. Have another cup of java and relax.

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