As anticipated, the shorts are putting up a fight, desperately attempting to resist the next thrust higher. However, fear not. They are on the wrong side of the trade. As Drago says: "You will lose".
Please keep in mind what I have been preaching for almost two weeks:
- This pullback is almost identical to the pullback of January 2011.
- Once a bottom a found, a volatile consolidation takes place.
- The paper spec shorts, just recently drawn into the trade, will initially fight the rally by "throwing good money after bad" in a desperate attempt to protect buy-stops and re-ignite downside momentum.
- The initial resistance is $1720 in gold and $32.25 in silver.
- The next resistance is $1730-36 in gold and $32.50-60 in silver.
- Once that level is cleared, even Helen Keller can see and hear the bottom. Gold will move toward $1755 and silver will advance upon $33.35.
The main thing you want to avoid is frustration and lack of patience. Give this process some time. Tomorrow's BLSBS may provide the impetus for the short-covering to begin in earnest. It also might not. Whatever. Just be long and strong. The metals are headed much, much higher from here.
Let's continue to lead with silver as it is clear that silver is currently leading gold, at least from a chart-advancement perspective. This is mainly due to the strong hands that are accumulating silver, not just in physical form in London but paper form in NY. This accumulation is increasing the pressure upon the shorts with each passing hour.
And, again, let not your heart be troubled by gold. The harder the shorts work to build a line of defense, the more violent the eventual short-covering spike will be.
OK, what else is there to discuss today? Well, there's this new gem from Jim Quinn on the Keynesian fallacy that storm damage is good for GDP growth. https://www.theburningplatform.com/?p=43305
Speaking of Sandy, we are now wrapping up the "First 72 Hours". The reason that I have "" marks around that term is that that is the title of a seminal study done by a renowned psychologist/sociologist a few years ago. If so inclined, you can read the entire paper here: https://www.atsdr.cdc.gov/emergency_response/common_misconceptions.pdf. In summary, it goes something like this:
- The first 24 hours are shock and disbelief.
- The next 24 hours are realization marked with determination and hope.
- After the next 24 hours, panic and mayhem can set in as those affected by the disaster begin to clamor for food, shelter, fuel, warmth etc.
To that end, here we go: https://www.nydailynews.com/news/national/gas-pains-pumps-dry-lines-long-new-york-article-1.1195237 & https://news.yahoo.com/tempers-flare-nj-city-where-thousands-stranded-171518266.html & https://www.nydailynews.com/new-york/brooklyn/looters-target-coney-island-sandy-article-1.1195080
My point is this: Watch this deterioration very closely over the next few days. If things begin to get out of hand, the negative publicity for the federal government could have a rather dramatic impact on late-deciding voters. In this case, it's pretty tough to hang it all on Romney. Obama will get the blame, deservedly or not.
To that end, I'm still getting questions about the impact of a Romney victory on metals prices. Let me state this a different way from yesterday:
DO NOT BE FOOLED BY THE OBVIOUS PLANTING OF MISINFORMATION IN THE MEDIA. ADDITIONALLY, SOME WOULD HAVE YOU BELIEVE THE QUANTITATIVE EASING IS SIMPLY AN ECONOMIC STIMULUS PLAN/EXPERIMENT, HATCHED BY THE EVIL BERNANK. AGAIN, PLEASE NEVER FORGET THAT QE IS ABOUT FUNDING THE ONGOING FEDERAL DEFICIT AT EXTRAORDINARILY LOW RATES IN A DESPERATE ATTEMPT TO PERPETUATE THE GREAT PONZI. ROMNEY AND RYAN CAN TALK A GOOD GAME BUT THEY WILL NOT BE ABLE TO IMPOSE "AUSTERITY" AND THEY WILL NOT BE ABLE TO STOP QE. PERIOD. END OF STORY.
Moving on, The Doc recorded and posted this interview with our pal, Ned, yesterday. Nothing earth-shattering but be sure to listen to the entire thing as plenty of relevant topics are discussed. Ponder, too, the topics mentioned toward the end of the podcast. When will we reach a point of "critical mass" where countries around the world suddenly rush to reclaim their gold before the imposition of a new, gold-based international trade settlement system? Next week? Next month? Next year? Hard to say but that point is definitely coming. Soon.
Lastly, today is the first day of November and this is significant, mainly because of this: Back in July and again in August, ole Thunderlips promised us resolution to the four-year silver investigation. He publicly stated that he expected this in "September or October". https://www.bloomberg.com/news/2012-07-23/cftc-s-chilton-sees-silver-probe-concluding-this-year.html
Well, it's November now and...still...nothing. If you have a few moments, perhaps you should politely nudge Commissioner Chilton and ask him what the holdup is. The CFTC itself issues all of the information that is so obviously indicative of concentration and manipulation, yet they dawdle. Has anything new come to light recently? Some 11th-hour-type proof of guilt or innocence that is delaying the verdict? I'd be interested to know. Anyone wanting to contact The Mullet can do so by emailing him at bchilton[at]cftc[dot]gov. If you hear anything back from him, please feel free to post his reply in the comments section of this thread. (And again, I ask you to be polite. I know for a fact that he receives plenty of emails but that he only takes seriously those who pose serious questions.)
Have a fun day. Don't get too stressed about today's Comex action. The "positive economic news" and resultant rally in The Pig is simply being gamed by the HFTs and algos. The real fun will come tomorrow with the reaction to the BLSBS.