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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      315 Comments

    ¤
    Aug 22, 2012 - 9:49pm

    Blood Diamond Documentary

    @Bollocks...I have a 21" monitor and the image I C&P'd was smaller but seems to be showing up much larger. Oh well...

    Blood Diamonds - Documentary
    ReachWest
    Aug 22, 2012 - 9:50pm

    Something's Up!

    Something's up in the metals (well they are) - normally don't see action like this in the metals at this time of day, IMO.

    15Min chart looking up - up - up. Silver just broke past $30.20

    Grigeo Bollocks
    Aug 22, 2012 - 9:51pm
    latcho
    Aug 22, 2012 - 9:51pm

    30!

    Archived:

    Nana
    Aug 22, 2012 - 9:52pm
    The Watchman
    Aug 22, 2012 - 9:53pm

    I Believe We Have A BREAKOUT

    Bulls have gained fresh upside technical momentum this week as prices are on the verge of a bullish upside “breakout” from the choppy and sideways trading range that has been in place on the daily chart for nearly three months. The gold market bulls have regained the slight overall near-term technical advantage. The gold bulls’ next upside price breakout objective is to produce a close above solid technical resistance at $1,650.00. Bears' next near-term downside price objective is closing prices below solid technical support at the August low of $1,586.30. First resistance is seen at the overnight high of $1,647.60 and then at $1,650.00. First support is seen at the overnight low of $1,638.40 and then at $1,633.30.

    September silver futures hit a fresh 2.5-month high overnight. This week’s price action in silver has produced a big and bullish upside breakout from a sideways and choppy trading range that had been in place on the daily bar chart. Silver bulls have gained the overall near-term technical advantage and have fresh upside momentum. Bulls’ next upside price breakout objective is closing prices above solid technical resistance at the June high of $29.915 an ounce. The next downside price breakout objective for the bears is closing prices below solid technical support at $27.50. First resistance is seen at the overnight high of $29.595 and then at $29.915. Next support is seen at the overnight low of $29.17 and then at $29.00.

    By Jim Wyckoff, contributing to Kitco News

    Aug 22, 2012 - 9:55pm

    Don't know is anyone noticed this

    cause it was posted on an older thread, but I thought I pull it over here since, to me at least, it is kind of interesting.

    New Cycle Found!

    Submitted by LongGoldLongSilver on August 22, 2012 - 8:17pm. at Tip!

    Hey guys, I just discovered the 8-tap Kondra-Elli-Super-Cycle hidden in plain view in the silver chart! I don't know what this means going forward but the implications could be absolutely astonishing...

    https://www.MiningStockValuator.com -portfolio tracker & analysis of gold and silver stocks

    ag1969
    Aug 22, 2012 - 9:55pm

    Japan turns to renewable energy

    If this is true, Japan is going to need lots of silver. They better get it now while it is still cheap:

    https://www.energyandcapital.com/articles/post-fukushima-japan-turns-to-...

    And if this is true they are going to need to import lots of food:

    Fukushima’s Fish Are Soaked In Record Levels of Radiation

    https://gizmodo.com/5936706/fukushimas-fish-are-soaked-in-record-levels-...

    And didn't Kyle Bass talk about Japan being the first to go, ponzi debt wise?

    What happened to Kyle Bass? He was the man for a couple months and then disappeared.

    It is nice to see silver surging. If it goes the other way I will buy more. Got food!

    agNau
    Aug 22, 2012 - 9:57pm
    Bollocks
    Aug 22, 2012 - 9:59pm

    @DrkPurpleHaze

    Just joking with you

    @ReachWest

    "normally don't see action like this in the metals at this time of day"

    Yes, I agree. Last time I saw that sort of thing happening, in a sustained way, like that was during the leap up to 49-ish, April 2011.

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