Step One Completed

264
Wed, Oct 31, 2012 - 11:51am

The first step in confirming a bottom is finding one. We found one last week and the action today looks to confirm it.

In the previous post, I asked you to watch for a break out and UP today and we've gotten it. First things first, however. Remember, any gains made while the metals are closed or on holiday are almost always clawed back once trading resumes. Almost always. And we saw this again today. The good news is that, once again, the old adage is holding...namely, "what was resistance becomes support and vice versa".

So, now what? Again, I must caution you against expecting too much, too soon. Though we have been base-building for over a week, we still need to overcome some additional resistance before the bottom is clear to everyone and the shorts begin to aggressively cover. Silver is still slightly ahead in this process and should continued to be watched for clues. For now, as you can see below, silver has clearly broken through the downtrend lines on both the 4-hour and 12-hour charts. This is undeniable and an obvious sign of the bottom to this correction/pullback. Closing above $32.25 is our first goal, followed by a close above $32.60 or so. Once that happens, the mealy-mouth, panty-waste spec shorts will begin to cover and price will extend toward the area around $33.35, where they will make their next defense.

The gold chart also shows a clear base and breakout on the 4-hour chart. It shows this on the 12-hour chart, too, but a case could still be made gold needs to clear $1720 first. OK, that's fine. $1720 is our pivotal level, anyway, so watch that area closely. A close above there and gold will jump toward $1730. The area between $1730 and $1740 might present some challenges but, ultimately, besting $1755 will become our next main goal.

I only wish to discuss one "news" item today and it's something that I don't think is getting enough press. Our old pal, KosherDakota made a speech yesterday that is being overlooked.

I began to ridicule this knucklehead a few years ago as it seemed he was trotted out to give the "hawkish" or "dovish" monetary policy view every time a little additional MOPE and SPIN seemed necessary. Here are a couple of samples. First, from August of 2010, three months before the announcement of QE2: https://www.minneapolisfed.org/news_events/pres/speech_display.cfm?id=4525. Before you know it, ole KosherDakota was all in favor of "bond buying" by The Fed: https://blogs.wsj.com/economics/2010/11/30/feds-kocherlakota-wants-inflation-expectations-increase/

But then, by the end of QE2, he was trotted out to assure the markets that QE could be bad and was perhaps gone for good. There might even be a rate hike just around the corner, maybe as soon as late 2011: https://www.minnpost.com/business/2011/05/fed-president-sees-possible-rate-hike-2011-economy-slowly-improves. And here we was in late June of 2011, dissenting at the FOMC and calling "stronger easing measures" the "wrong approach": https://wtbx.com/news/articles/2011/jun/27/tax-code-hurts-stability-feds-kocherlakota/

So, what happened yesterday? Chuklehead The Clown was back in the news! He was speaking in Duluth and he openly stated that:

"The U.S. economy is recovering from the largest adverse shock in 80 years–and a historically unprecedented shock should lead to a historically unprecedented monetary-policy response".

He went on to add that:

“Given how high unemployment is expected to remain over the next few years, these inflation forecasts suggest that monetary policy is, if anything, too tight, not too easy".

You can read all about it here: https://blogs.wsj.com/economics/2012/10/30/feds-kocherlakota-fed-may-not-be-providing-enough-stimulus/.

Even the left-leaning and progressive (Keynesian) website Slate has an article about it today: https://www.slate.com/blogs/moneybox/2012/10/31/narayana_kocherlakota_s_duluth_speech_a_masterpiece_of_intellectual_rigor.html

Intellectual rigor my ass. This guy just flips and twists in the wind. For now, he is simply being trotted out yet again to foreshadow the next direction of Fed policy. We should now fully expect a formalized increase in the projected 2013 QE∞ plan when the FOMC next meets in December, regardless of the SPIN and MOPE that comes out on BLSBS day or from O'Bomney.

To that end, I've received several emails wondering what I expect from the metals if Romney is elected. The answer is simple: MORE OF THE SAME. Those that fear a downturn in price because of a Romney-imposed austerity or firing of The Bernank are delusional. Let me state this very clearly as a reminder for all eternity:

QUANTITATIVE EASING CANNOT END. NOT THIS YEAR. NOT NEXT YEAR. NOT EVER. IN 2013, THE FED WILL PURCHASE OVER $1T OF NEWLY ISSUED AND REFUNDED U.S. GOVERNMENT DEBT. WITHOUT THE FED PURCHASING MBS FROM THE PRIMARY DEALERS, AUCTIONS WOULD FAIL AND INTEREST RATES WOULD RISE DRAMATICALLY. THIS WOULD RAPIDLY ACCELERATE THE DEMISE OF THE GREAT PONZI AND THIS CANNOT BE ALLOWED. THEREFORE, IT MATTERS NOT WHOM WILL BE THE NEXT PRESIDENT. QE WILL CONTINUE UNABATED, REGARDLESS. ALL OF THE TALK ABOUT THE BERNANK AND SPENDING CUTS IS SIMPLE POLITICAL SPIN TO GET VOTES, SIMILAR TO THE PHRASE "BORROW FROM THE CHINESE".

Lastly, I leave you with another great article from Jeff Nielson at BullionBullsCanada. https://www.bullionbullscanada.com/gold-commentary/26018-the-great-gold-scam

Have a great day!

TF

About the Author

Founder
turd [at] tfmetalsreport [dot] com ()

  264 Comments

Bollocks
Oct 31, 2012 - 1:10pm

WILLIAM BANZAI7's BAILOUT THRILLER 3.0.mov

WILLIAM BANZAI7's BAILOUT THRILLER 3.0.mov
pidginharlan07
Oct 31, 2012 - 1:15pm

ah, ofcourse, ty

ah, ofcourse, ty

Wizard
Oct 31, 2012 - 1:18pm

As We Race Along

As we race head long into the end of another currency system. The likes of which will have untold repercussions around the planet this time. Let us remember that we are the fortunate ones. There are untold multitudes of our fellow humans that have absolutely no clue that this change is coming in a fast and furious manner. Nor do most seem to want to know. Just as Gold and Silver markets are very small, so is the community of people that actually have an idea what is coming.

Everyone Knows Who Is Who In The Zoo.

And the fact that anyone publically try's to make calls in an utterly rigged market just means they have a pair of Big Brass Balls. And to do this for the benefit of others means to me there is true bravery at play.

I raise a glass to the young man with the bravery to make such a community as this. Where all of us crazy people (as I am considered by some family members) can come and share in the history making times in which we live.

A Life Spent In The Service Of Others, Is Truly A Noble Thing.

W

Oct 31, 2012 - 1:18pm
tpbeta
Oct 31, 2012 - 1:19pm

Thanks Mr T

I asked you answered.

H - original
Oct 31, 2012 - 1:19pm

Happy Halloween Folks!

Between stacking and prepping and taking care of a baby, no time to create something new this year...

So here is something from a couple of years ago... great words from a great man!

Ron Paul : What If Halloween.wmv
Island TealBollocks
Oct 31, 2012 - 1:21pm

Bailout Thriller 3.0.mov

It makes you laff and then makes you cry when you realize how true it seems.

well done......

SteveW
Oct 31, 2012 - 1:21pm

Silver

Nice commentary TF. I also see $32.50 for silver as a critical level since until we get a move through this level silver remains range bound $31.50-$32.50 where it has been for almost 2 weeks.

On the positive side the miners are doing well and the HUI has broken through 500 so I'm hopeful my Jan SLV calls may payback my Oct losses.

Silver Alert
Oct 31, 2012 - 1:21pm

It's smashing time

Looks like they're really trying to smash g&s below Turd's (1720 & 32.25) levels before Comex close. Seems like some of the monkeys take things personally.

Sheetrocker
Oct 31, 2012 - 1:29pm

SLW

Just a reminder for those who play with SLW, as I do. Q3 earnings will be reported Monday, before market open.

SLW is trading right now at $8.00 over spot silver. I think this is the biggest disconnect I have ever seen.

It's looking a little scary to me. Good/bad earnings, rising/falling spot price could have a big effect on this puppy Monday, IMO.

Subscribe or login to read all comments.

Contribute

Donate Shop

Get Your Subscriber Benefits

Private iTunes feed for all TF Metals Report podcasts, and access to Vault member forum discussions!

Key Economic Events Week of 10/14

10/15 8:30 ET Empire State Fed MI
10/16 8:30 ET Retail Sales
10/16 10:00 ET Business Inventories
10/17 8:30 ET Housing Starts and Bldg Perms
10/17 8:30 ET Philly Fed MI
10/17 9:15 ET Cap Ute and Ind Prod
10/18 10:00 ET LEIII
10/18 Speeches from Goons Kaplan, George and Chlamydia

Key Economic Events Week of 10/7

10/8 8:30 ET Producer Price Index
10/9 10:00 ET Job Openings
10/9 10:00 ET Wholesale Inventories
10/9 2:00 ET September FOMC minutes
10/10 8:30 ET Consumer Price Index
10/11 10:00 ET Consumer Sentiment

Key Economic Events Week of 9/30

9/30 9:45 ET Chicago PMI
10/1 9:45 ET Markit Manu PMI
10/1 10:00 ET ISM Manu PMI
10/1 10:00 ET Construction Spending
10/2 China Golden Week Begins
10/2 8:15 ET ADP jobs report
10/3 9:45 ET Markit Service PMI
10/3 10:00 ET ISM Service PMI
10/3 10:00 ET Factory Orders
10/4 8:30 ET BLSBS
10/4 8:30 ET US Trade Deficit

Key Economic Events Week of 9/23

9/23 9:45 ET Markit flash PMIs
9/24 10:00 ET Consumer Confidence
9/26 8:30 ET Q2 GDP third guess
9/27 8:30 ET Durable Goods
9/27 8:30 ET Pers Inc and Cons Spend
9/27 8:30 ET Core Inflation

Key Economic Events Week of 9/16

9/17 9:15 ET Cap Ute & Ind Prod
9/18 8:30 ET Housing Starts & Bldg Perm.
9/18 2:00 ET Fedlines
9/18 2:30 ET CGP presser
9/19 8:30 ET Philly Fed
9/19 10:00 ET Existing Home Sales

Key Economic Events Week of 9/9

9/10 10:00 ET Job openings
9/11 8:30 ET PPI
9/11 10:00 ET Wholesale Inv.
9/12 8:30 ET CPI
9/13 8:30 ET Retail Sales
9/13 10:00 ET Consumer Sentiment
9/13 10:00 ET Business Inv.

Key Economic Events Week of 9/3

9/3 9:45 ET Markit Manu PMI
9/3 10:00 ET ISM Manu PMI
9/3 10:00 ET Construction Spending
9/4 8:30 ET Foreign Trade Deficit
9/5 9:45 ET Markit Svc PMI
9/5 10:00 ET ISM Svc PMI
9/5 10:00 ET Factory Orders
9/6 8:30 ET BLSBS

Key Economic Events Week of 8/26

8/26 8:30 ET Durable Goods
8/27 9:00 ET Case-Shiller Home Price Idx
8/27 10:00 ET Consumer Confidence
8/29 8:30 ET Q2 GDP 2nd guess
8/29 8:30 ET Advance Trade in Goods
8/30 8:30 ET Pers. Inc. and Cons. Spend.
8/30 8:30 ET Core Inflation
8/30 9:45 ET Chicago PMI

Key Economic Events Week of 8/19

8/21 10:00 ET Existing home sales
8/21 2:00 ET July FOMC minutes
8/22 9:45 ET Markit Manu and Svc PMIs
8/22 Jackson Holedown begins
8/23 10:00 ET Chief Goon Powell speaks

Key Economic Events Week of 8/12

8/13 8:30 ET Consumer Price Index
8/14 8:30 ET Retail Sales
8/14 8:30 ET Productivity & Labor Costs
8/14 8:30 ET Philly Fed
8/14 9:15 ET Ind Prod and Cap Ute
8/14 10:00 ET Business Inventories
8/15 8:30 ET Housing Starts & Bldg Permits

Recent Comments

by boomer sooner, 1 hour 4 min ago
by boomer sooner, 1 hour 34 min ago
by Texas Sandman, 3 hours 18 min ago
by lakedweller2, 4 hours 34 min ago
by lakedweller2, 4 hours 37 min ago

Forum Discussion

randomness