Weekend Review

481
Sat, Sep 22, 2012 - 12:16pm

What an interesting week. Instead of volatility, we got containment and flatlines. Something tells me next week won't be the same.

Ponder this for a moment, QE∞ is announced as official Fed policy last Thursday. That day gold, the only alternative currency to steadily-debasing fiat, responds with a $38 move. Frankly, I would have expected more but, given the Cartel propensity for containing daily moves at either the +1% or +2% levels, $38 seemed about right. However, over the next five days, would you have expected this?

  • Friday, 9/14: net change +$0.60
  • Monday, 9/17: -$2.10
  • Tuesday, 9/18: +$0.60
  • Wednesday 9/19: +$0.50
  • Thursday 9/20: -$1.50

So, cumulatively over the next five days trading in gold, immediately following the long-awaited announcement of QE∞, the total change was down $1.90. Huh?? And, again, it's not like we saw the +$20, -$22, +$31 kind of volatility you would have expected. Very strange and, once again, subtle evidence of the outright blatant and ongoing manipulation and "managed ascent" of the paper price by The Gold Bullion Banking Cartel.

To no one's surprise, this week's CoT continued the trend of Cartel naked short issuance to contain price. Again, I'm not really sure who wrote the mandate that JPM, DB et al have to act as market makers in the metals but, for some reason, that is the role they allege to play. Spec money comes into the pit and the banks issue the highly-leveraged paper. Not content to see price bid up as the spec bids search for willing sellers of existing contracts, The Cartel, instead, simply issues brand new contracts to satisfy demand.

In doing so, The Gold Cartel added another 18,196 short contracts this week and brought their net short ratio back up to an astonishingly dangerous (to them) 2.68:1. Why is this so dangerous, you ask? Because they are continuing to play this game as if none of the fundamentals have changed. This is no longer 2002 or 2008. It's not even 2011. We are near The End Game for fiat currency and the "creditor nations" around the globe recognize this. The are readily exchanging their rapidly-devaluing fiat for hard assets, gold in particular. This insatiable physical demand underpins the paper market and makes precipitous, short-covering drops, like we've seen The Cartel execute in the past, all but impossible. Oh sure, there will still be selloffs and beatdowns...Heck, we saw one yesterday...but incessant physical demand forces The Cartel to quickly turn tail and buy in order to cover and secure the metal required to meet the allocations sought at every London fix.

So, again, look to buy the dips. Not every $5 dip, mind you, but any substantial dip the pushes price back to obvious support points. Right now, the obvious area is around $1755-1760. IF a dip develops early next week, I'll be all over it. Gold looks certain to soon blast through $1780 and then $1800. From there, I expect a rapid move toward the old all-time highs of $1920. At that point, gold could, once again, get disorderly to the upside, similar to what we saw in August of 2011. It will likely break out and UP through the long-term channel again and head toward and through $2000.

And here is a long-term chart of gold priced in euros. Recall that we've been discussing for weeks how euro/gold was getting well ahead of dollar/gold and that dollar gold would eventually catch up. A month ago, euro/gold was showing that $1800 gold was coming. Now, euro gold makes it look like $1920 gold is only about a month away. (Chart courtesy Trader Dan: https://www.traderdannorcini.blogspot.com/2012/09/euro-gold-on-track-for-all-time-high.html)

And JPM and their pals continue to play games with silver, blissfully unaware that their dynasty has ended. Just last week, they added another 2,880 short contracts in a vain attempt to pin price below $35 and protect the vulnerable buy-stops near $35.50 that, if tripped, would send silver quickly toward $37.50. Oh well, screw 'em. So they "won" this week. Whatever. They're just going to lose eventually so what's another week of waiting. Now at a total gross short position of 82,358 contracts and a net short ratio of 2.58:1, The Silver Cartel is sitting on a powderkeg of their making. Boy is it ever going to be fun to watch it explode right under them.

As The Doc pointed out yesterday, The Forces of Darkness expended a lot of ammunition yesterday in a desperate attempt to start a cascade and keep price under $35. ( https://www.silverdoctors.com/cartel-dumped-2x-annual-us-silver-production-on-market-in-15-min-to-smash-silver-under-35/) They now find themselves in a bit of a jam as we head into Tuesday. They'll need to cover quite a few contracts before the 1:25 EDT close that day or they risk showing their footprints on next week's CoT. What will they do? Cover, of course! Now the question is, will they gamble by raiding first and hoping for a steep enough selloff that they can cover the raid "material" and more on the way back up? Maybe but I doubt it. Physical demand will easily blunt the dip again just as it did yesterday. Their only logical choice, after being thwarted yesterday, is to begin to cover yesterday's new shorts as early as Monday, otherwise they risk a significantly "Happy Tuesday" that blows out those $35.50-area buy stops and send price toward $37+. What to do, what to do. A whole lot of choices, all of them bad. HAHAHAHAHA! You did this to yourselves, you arrogant bastards, and now you're stuck. You'll get no sympathy around here.

And in case the action in crude this week left you feeling that global peace and harmony were right around the corner, I give you this to ponder: https://www.zerohedge.com/news/2012-09-22/head-irans-revolutionary-guards-war-israel-will-occur

In that same vein, I was contacted this week by a nice guy who asked me to link a few of his prepping articles. I certainly hope you are using this time to full consider these topics: https://destinysurvival.com/2012/09/03/food-storage-how-to-calculate-for-your-needs/ & https://www.emergencyfoodstorage101.com/2012/08/07/being-prepared-for-power-outages/. Of course (shameless plug coming), you can find many of these items by visiting the Turdmart, a link to which is conveniently placed at the top of each page but copied below for your convenience.

https://www.tfmetalsreport.com/preparation-store

I hope that everyone has a safe, fun and relaxing weekend. Come back on Monday and be prepared for a week that is considerably more volatile and interesting than this past one was.

TF

11:00 pm (23:00) EDT Sunday UPDATE:

So, what the hell happened at 20:58? Anyone have a guess? I do but, first, let's look at the charts:

At exactly the same time, the POSX began an uptrend that carried it 20 ticks higher over the next hour.

So, what we likely have here is another HFT algo (WOPR) run amok. True Cartel hit jobs rarely impact so many markets across the board. On a light volume Sunday night, a brainless computer "saw" the uptick in The Pig and began program selling.

Regardless of instigator or intention, it is going to be very difficult to break down paper price much further. Difficult but not impossible. That said, I will be very surprised to see the metals considerably lower in the morning as there is no reason to expect a buyers strike in London on Monday. As mentioned Friday, gold should have considerable support near $1750. Silver will continue to find bids, just as it did two hours ago, near $33.50.

Hang in there and try not to panic. If protracted selling does come in, consider it a blessing. Please consider any and all bouts of price weakness as opportunities to add to your stack.

TF

About the Author

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  481 Comments

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kingboo
Sep 23, 2012 - 11:02pm

agNau..."Whitewater ahead"

now thats funny!.......a little scary, and true......but still that was a good one.

When i was a kid we went whitewater rafting on the Colorado River........and i will never forget the raft captain telling us to "hold on tight...because we're coming up on the Diner"........ i was maybe 10yrs old....... so i said "the Diner?...why do they call it the Diner?" and he said "because thats where everybody eats it kid! That's where everybody eats it!" The guy had a big creepy smile on his face..............yup, he enjoyed watching us get our asses kicked by the river...

Horst
Sep 23, 2012 - 11:01pm

Dr G

Always good to know that there is 1 or 2 other persons out there who get it ;).

tyberious
Sep 23, 2012 - 10:59pm

From The DOC

Silver Smashed to $33.50 As 50% of US Annual Silver Production Dumped on Market in 5 Minutes

Apparently Blythe’s monkey’s are burning the Sunday midnight oil in order to prevent silver clearing $36 and triggering JPM’s rumored silver derivative losses.

A miniature replica of the May 2nd, 2011 drive by shooting was just completed, as silver was knocked down the proverbial mine-shaft moments ago, dropping nearly a dollar in nano-seconds on Monday’s Asian open.

Volume data indicates that 3,297 contracts, or 16.5 million paper ounces of silver were dumped on the market in a mere 5 minutes between 9:00 and 9:05pm EST.
In other words, approximately 1/2 of the entire US annual silver production was dumped on the market by the cartel in a 5 minute period on a Sunday night.

https://www.silverdoctors.com/silver-smashed-to-33-50-on-asian-open/

Jasound
Sep 23, 2012 - 10:47pm

Gold-plated tungsten alloy bars for sale.

I am not advocating or condoning this, but I found this info on the web and I am simply sharing the information.

If you are interest in our tungsten alloy golden bar, gold-plated tungsten alloy bar, please feel free to contact sales[at]chinatungsten[dot]com, or telephone 86 592 512 9696.

Click photo for link.

Bugzy
Sep 23, 2012 - 10:40pm

Seems very straight forward

Fake Bars:

Come on folks - think!

These transactions must be logged. U.S law. Bank accounts ID etc

Therefore names and addresses CCTV etc. This ought to be easy to track down.

What - they can finger the bin larden plot from top to bottom in less than a week - have massive troops on the way to Afghanistan - some goons selling fake bars ought to be a walk in the park right?

Rearrange these four letters to make a well known saying or phrase:

smell rat I a

Bugzy

agNau
Sep 23, 2012 - 10:37pm
tyberious
Sep 23, 2012 - 10:37pm

Hopefully

The tungsten story leads to testing, then to auditing, then to discovery of missing allocated and unallocated bars and finally to the fraud that is Comex, GLD, SLV and the ring leader LBMA.

kingboo
Sep 23, 2012 - 10:32pm

Tungsten in gold bars doesn't worry me....

What worries me is why The New York Post..(and all these other rags) is running the story............in other words who ordered this story to get out there....and why. If the higher-ups didn't want this tungsten story publicized, it wouldn't be publicized....period. It sounds like TPTB are "softening up the target"......and i don't know exactlty what that means to goldbugs.......but i know it's happening, of that you can be sure.

So the real question is: are they preparing us?

are they scaring us? it's 1 of the 2........possibly both.

withoutwax
Sep 23, 2012 - 10:27pm

This is also Very Clear

Video unavailable
Sep 23, 2012 - 10:25pm

@PrizeFighter

Quote:
It is you who doesn't seem to understand that gold and silver isn't just about performance but removing your consent from the system. Be clever all you want in the markets. Some of us choose not to play the game. Don't think you can school us on why we should play your way.

I wish I could hat tip you to ∞. It still would not be enough.

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