Deja Vu...All Over Again

Thu, Oct 4, 2012 - 10:43am

Shit's gettin' old.

OK, The Bad Guys have been doing their Masters' bidding for three weeks now. Since the introduction of QE∞, the metals have been aggressively capped. Gold has been contained, first below 1780 and, ultimately, 1800. Why? Pull up a long-term chart. Once through 1800, gold will almost immediately press forward to 1850 and then 1900. Silver has been capped, too. The $35 level was defended first but the main target is near 35.50. Once above there, silver will quickly advance toward 37.50.

The Cartel defense of these levels has been consistent and aggravating. But also predictable. I mean, seriously, were you at all surprised by the beatdown earlier this morning? If you were, you haven't been paying attention. First, there was the Globex smackdown of 9/17 followed by similar action the next morning:

We gave it a week and it happened again:

Just three days later, they began attacking during the morning, instead:

The real desperation began this week. Here is Monday:

And Tuesday:

And after taking a break yesterday, they came back again today:

On the bright side, price has since rebounded somewhat while the dollar has continued to slide lower and the London PM fix was again quite busy with new multi-month highs in both $gold and eurogold. The remaining sand is rapidly pouring through the hourglass now and resolution to this seemingly endless capping event is near.

And a heads up. I bought another Dec12 $8 corn call this morning just as I suspected I would earlier this week. I like this chart a lot and we have another crop report due next week (I think). Regardless, a move here through $7.65 should lead to some additional short covering and fresh buying. This should shove corn back toward $7.85 and, once back above there, $8+ will soon follow.

Lastly, just an update on our bullion affiliation with GBI and the Hard Assets Alliance. Though I am still enamored with their platform for buying, storing and even trading metal, I certainly understood the frustration from some regarding their $35 "account setup fee". Apparently they've gotten enough negative feedback now that they've decided to do away with the fee. So, if you haven't already, I invite you to check out the HAA site. Your purchases there help to pay the bills here so please give them your consideration. Thanks!

I hope that everyone has a great day in preparation for what should be a very interesting BLSBS day tomorrow.


About the Author

turd [at] tfmetalsreport [dot] com ()


Oct 4, 2012 - 11:43am


Silver gently up in Asia, more sharply up in London, flutters around the noon fix. Then comes the Comex open in New York and Pow! I was thinking of setting my watch by it, but the monkey train was a few minutes late this morning. Must have been a staff meeting.

The variable to watch is the smack-down recovery time: they can smack it, but how long does it take to get up off the floor?

Mr. Fix
Oct 4, 2012 - 11:44am

@ Dyna mo hum

Maybe we could try below sea level.

Dr G
Oct 4, 2012 - 11:45am

Love the chart that Turd

Love the chart that Turd posted. That is what she is called, right. A chart? ;)

Oct 4, 2012 - 11:45am

They've taught all the traders one thing for sure...

If you buy after it goes over $35, you're going to get your ass handed to you pretty quickly. I can't even imagine who would initiate a new position at say $35.10 right now.

Oct 4, 2012 - 11:47am


The Unemployment claims today was just about enough to co-ordinate an attack......BLSBS statistics tomorrow will provide a perfect excuse for the Cartel to launch an all out attack.....I sincerely hope to be wrong....wish me luck to be wrong.....all i wish is a nice FUBM tomorrow

Oct 4, 2012 - 11:49am

Oil sellers are being punished today.

I made a good call on USO yesterday. Look at that... Yesterday's hanky-panky with the oil price was totally unwarranted and now they are getting punished for their poor behaviour.

Titus Andronicus
Oct 4, 2012 - 11:53am

Silver COT Analysis: commercial short squeeze case studies.

Based on the recent changes in the gold and silver COTs, I decided to post another COT analysis. This study covers silver, but similar things can be said about gold.

Below is my very "busy" COT chart for silver. Sorry the resolution is not better. I reprint the text boxes below, so don't kill your eyes trying to read them from the chart.

  1. This chart covers 12 years from 2001 (starting on the left) until today (on the right).
  2. The top part of the graph shows the price.
  3. The middle colored part shows the commercial net position. (When I say "net position" below, I'm talking about the commercial net position.) IMPORTANT: notice that since 2003, the commercial net position has been swinging up and down within a rising channel. (This channel is drawn in blue.)
  4. You can ignore the two sets of lines on the bottom part.
  5. The commercial net position (middle part of chart) is colored into green, red and yellow.
    1. GREEN: Rising price and falling net position. (Commercials selling into strength.)
    2. RED: Falling price and rising net position. (Commercials buying weakness.)
    3. YELLOW: Rising price and rising net position. (COMMERCIAL SHORT SQUEEZE!!!)
    4. These colorings are simplified to help make them easier to read. (For example, the net position is not only rising in the RED regions.) They can be broken down into finer resolution, but the above is good for making my point.
  6. My theory is that GREEN and RED are the normal, routine "modes" of market operation: commercials selling into strength and buying weakness. But when the commercials have hit the bottom of the channel ("run out of ammo") and price continues to rise, they are forced to buy into strength -- YELLOW: commercial short squeeze.
  1. CASE A: (see text box labeled "A" in the chart above.)
    1. 9/05-1/06: Very hard drop in net position.
    2. 1/06-5/06: Commercial short squeeze! (A good one!)
  2. CASE B:
    1. 9/07-2/08: Very hard drop in net position.
    2. 2/08-3/08: Commercial short squeeze of very short duration. (DARN!)
  3. CASE C:
    1. 4/09-12/09: Strong drop in net position.
    2. No immediate short squeeze. (Commercials are SAVED BY THE BELL!)
  4. CASE D:
    1. 10/10-5/11: Finally we get the commercial short squeeze.
    2. This was the "big momma".
  5. CASE E:
    1. 7/12-9/12: Very hard drop in net position.
    2. Followed by ???? ("big daddy"?)

So the idea is: once the commercials go short all the way to the bottom of the channel, they are forced to start buying. If price continues to rise after hitting bottom, the commercials are forced to buy into strength (the commercial short squeeze) -- and gold bugs everywhere experience commercial short covering nirvana ... for a time.

Are we there yet? We are getting much closer than I thought we would be in 3 months. The drop in net position over the last 3 months is drastic! And very close to the bottom of the channel! We may or may not be there, but we are a LOT closer than we were 3 months ago. Look back on the chart ... do you see a drop as sharp and fast as the latest one? I guess that case "A" above is very close. Personally, I guess we are not quite there yet (see next point.)

Will the commercials be "saved by the bell"? Could be. If you study the graph, you can see a number of instances where a sharp drop did not result in an immediate YELLOW short squeeze -- that is, price dropped and gave the commercials a chance to cover.I think, that the commercials will be "saved by the bell" shortly and that we'll have to wait for a "round 2" like we did in the "C" and "D" cases above. But maybe not!

When will we know for sure? That's easy! Price AND net position will be rising at the same time.

What do we do then? BUY and HOLD and WATCH OUT! In general, the YELLOW short covering regions have been followed by sharp drops in price. Commercial short covering results in sharp increases in price followed by a collapse. So the idea is that you can make a lot of fast money -- especially if you are leveraged -- but you cannot overstay your welcome. (Maybe you can lighten along the way.)

Is it really that easy? Probably not. Ask me again afterwards.

Swift Boat Vet
Oct 4, 2012 - 11:53am

After Last Night's Debate -------

Obama must hope Obamacare covers asskickings


Oct 4, 2012 - 11:55am

Can anyone get a Iran Rial

Can anyone get a Iran Rial gold chart?

Oct 4, 2012 - 12:02pm

How many bullets left

I would like to know how much selling power the cartel has in a given day, especially if there is a sustained and constant buying force in opposition. Do they sometimes use up all their bullets on a given day and have to retreat for some time period? Maybe they try to pick their fights depending on the buying fire power for a particular span of time.

Eman Laer
Oct 4, 2012 - 12:04pm

"We'll find you"

Nestlé Replaces Willy Wonka's Golden Ticket With A GPS Tracker in 'We'll Find You' Kit Kat Campaign

“In a first of its kind promotion, KIT KAT is using cutting edge geolocation technology to track down six lucky winners across the UK and Ireland. Inside selected packs there will be a GPS enabled device which, when the winner pulls the tab, notifies the delivery team who will locate them within 24 hours and hand over a cheque for £10,000 (12,000 Euros),” says a Kit Kat press release. “KIT KAT’s pioneering We Will Find You promotion means winners won’t have to move a muscle to claim their prize, with the expert delivery team ready to overcome all obstacles to ensure they reach the chosen few in time!”

Nestlé 'We Will Find You'
Oct 4, 2012 - 12:05pm
Sheetrocker Titus Andronicus
Oct 4, 2012 - 12:09pm

Titus Andronicus

Very interesting! Thanks a lot for sharing your work!

Irish-Mic SilverTree
Oct 4, 2012 - 12:13pm


@SilverTree - you asked about gold charts in Iranian Reals. Took a quick look and found these:

90-day gold chart:

Sep '02 - Aug '12 chart:


Oct 4, 2012 - 12:15pm

coin shop

Visit to my local coin shop yesterday.

He cannot keep silver in stock and has orders for ten and 100 oz bars he cannot fill.

Gold is also in high demand.

There are still people selling out their gold rings and jewelry, and are happy to get 30% of their true value. Fools.

The cartel must be seeing diminished physical gold returns at these prices, and should concede to let the prices rise in order to steel the remaining true wealth from the sheeple.

After the fleecing is over, they will push it up beyond reach and probably make silver illegal based on national security concerns.

End coin shop owner conversation......

.....never mind how many one ounce rounds I left with.

Oct 4, 2012 - 12:15pm

miss piggy

down .49 right now.... oooomph

metals should respond , but not enought to blast it over 1795 or 35.50 and close there AFTER the globex. There will be the slow drain after 2:20 as always........

and yes tomorrow is a make it or break it day, hope we make it.

and I ask you whats sooo funny about peace, love, and understanding ?

Oct 4, 2012 - 12:22pm
Oct 4, 2012 - 12:23pm

Silver Tree !

No can do .... Rial/Gold chart .... can't afford that much paper .... maybe if the chart was made of Rials glued to the bathroom wall ? Monedas 1929 Comedy Jihad The Cost Of Wiping Your Ass In Iran Is Going To The "Moon" Tour

Oct 4, 2012 - 12:24pm

Iran Rial Gold Chart


Silver is more impressive; up 22.41% in the 90-day!

Oct 4, 2012 - 12:24pm


Looks like you used the offical exchange rate in the IRR/gold and siler charts??? If you use blackmarket chart, see zerohedge for example, then it will look AMAZING!

Sheetrocker reefman
Oct 4, 2012 - 12:26pm


I hope it continues to climb! My UCO is nearly back in the green.

Oct 4, 2012 - 12:29pm

Atlanta LCS

Anyone know a good local coin shop in Atlanta?

Oct 4, 2012 - 12:37pm

Swineflogger !

You don't pen your 700 lb hogs anywhere near the path to your outhouse ? You heard about that 70 year old Oregonian and his "closed casket" funeral (actually he was buried in a shoe box) ? I immediately thought of you .... and your widow ? Monedas 1929 Comedy Jihad Bad Case Of Post Mouth Tour

Oct 4, 2012 - 12:38pm
Oct 4, 2012 - 12:38pm

AU/AG Segment just on CNBS - link to pole.

CNBS just ran a gold or silver segment with a pole for the better buy ( - when I took it - it was

Silver 11 votes

Gold 0 votes

Big Buffalo
Oct 4, 2012 - 12:41pm


slow melt up, very very slow.

until, of course, any news comes out.

Oct 4, 2012 - 12:42pm
Oct 4, 2012 - 12:47pm
Oct 4, 2012 - 12:49pm
Oct 4, 2012 - 12:53pm


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