Some Charts

283
Thu, Dec 20, 2012 - 12:15pm

I've received several requests to "do what I do". So, here you go. (Keeping in mind that you should probably do the opposite.)

First of all, these hourly charts are astonishing. Just six, short trading days ago, The Fed confirmed QE∞ at a minimum of $85B/month, all needed to fund the ongoing U.S. federal deficit. Instead of rallying, the metals have been slaughtered. Why? Hmmm...We've seen this phenomenon in crude before (https://www.zerohedge.com/news/curious-case-post-qe-oil-hangovers) & (https://www.zerohedge.com/news/2012-10-09/why-oils-post-qe-plunge-may-be-over) and apparently it's worked so well there that The Fed and Their Cartel have decided to give it a go in the metals, too.

And now, mainly, I'm just mad at myself because I didn't see this coming. Of course The Fed is going to instruct their minions to crush the PMs. The Fed had no choice but to initiate QE∞ and the last thing they needed was an immediate, perceived quid pro quo with rising metals prices. The metals had to be crushed. It's all a part of their ongoing strategy of MOPE and SPIN. Duh! (Jeez, the more I type the more stoo-stoo-stoopid I feel. Better stop here.)

All that said, there is no reason to think that it's over, that the 12-year PM rally is kaput. I'm sure that the metals will stop and reverse, just like last year. The only question is, where? Since nothing has changed and the fundos are, in fact, even stronger than last year at this time, why would we expect prices to break any lower than they did a year ago? (Keeping in mind that the last sentence was typed by a guy who didn't see this selloff coming.) Sometime soon, the metals will reverse with a sharp, short-covering rally. That rally will likely stall and the momo-shorts will be emboldened to take another stab at the downside. Then, after failing to take things markedly lower, a bottom will form and price will begin to recover. If compelled to trade paper in this environment, here are some charts that show a striking similarity to the action of a year ago.

Hang in there. Good luck.

TF

About the Author

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turd [at] tfmetalsreport [dot] com ()

  283 Comments

kingboo
Dec 20, 2012 - 11:45pm

@Bill of Rights.......

you have any children?........ the whole fucking incident touched my nerves...... and i get it, hell...i'm as pro 2nd amendment as you will ever find..... but if we're gonna stand up for our Constitutional rights, let's not start by calling one of the Dads "an actor".....because you saw him smile for a millisecond....... get a grip.

unfashtandich Katie Rose
Dec 20, 2012 - 11:45pm

I love your posts

I too am a silver stacking, goat milking, farmer at heart. But hard times are here and things are not how we had planned them. Our hope was that silver would be the way we could buy the farm we want and do it right. But now it's a matter of survival while trying to hold on too as much of the stack as possible ,hoping for the big one. All the best to you and keep us updated.

philipat
Dec 20, 2012 - 11:58pm

@DPH

That Vid was doing the rounds earlier this year, about the same time as this, before she became known. Eye candy time, but a great song also. Sorry off-topic but I'sick of looking at the "Markets".

LANA DEL REY-BLUE JEANS
¤
Dec 21, 2012 - 12:05am

Post Mayan Non-Event Celebration

Same as it ever was...

Video unavailable
OneTime
Dec 21, 2012 - 12:41am

Ammo

Don't believe the tabloids...I found plenty of AK ammo at Wal-Mart today. I stack it right next to my 'other' stack.

rtabit
Dec 21, 2012 - 1:44am

@Mr. Fix Charts

As the self-appointed defender of charts around these parts I feel obligated to answer your questions with a little simple logic anyone can understand. Maybe some of you TA haters will see the logic of why we use TA and how it’s useful.

Could somebody tell me what the validity of using a chart to predict what is coming is when there is obviously no correlation between what is happening as compared to the fundamentals?

  • 100’s of years of data. Charts have nothing to do with fundamentals anyway, mixing the two together in my limited experience has led to disastrous results.

Do your charts tell you when we are going to hit a bottom? If so, where is it?

  • I think you mean at what price not when, but I’ll answer your question literally. After all WD Gann did say “Time is the most important factor in determining market movements because the future is a repetition of the past and each market movement is working out time in relation to some previous Time Cycle.”
  • According to guys at Gann Global, who have giant database going back to 1800's, based on data going back to 1900 we know that 52% of all corrections in gold would have been completed by Dec 3rd, and that 79% of all corrections would have been completed by Jan 7th. So we know we are in the 52% - 79% time range of when all corrections would have been completed by. This correction is from 1800 pivot.
  • It’s the same with using pitchforks that I like to post here. Dr Andrews research showed that when within a pitchfork, there is a 80% chance that the price will return to the medium line.
  • So yes, my chart tells me to a certain degree of error when and at what price we are going to hit a bottom. But it’s just a forecast, and forecast are not always correct, it doesn't work 100% of the time. That’s fine with me, you seem to think that if the forecast is not exact and correct 100% of the time, then it is either not valid or not useful, I think it’s both valid and useful.

If you took away the chart, then could you ask why there has to be a bottom?

  • I don’t understand this question. But earlier this year some guy from seeking alpha was predicting negative prices for natural gas. The fundamentals he used I think was something like since we only have so much storage, and because we were mining so much of it, that companies would pay to have it taken off their hands rather than burning it (or however you would get rid of natural gas I forget). So only using fundamentals could someone make the argument that a commodity would go into negative value, which I guess is why you ponder if there has to be a bottom since you don't use charts.
Silverman
Dec 21, 2012 - 2:35am
philipat
Dec 21, 2012 - 3:10am

@Byzantium

This is a difficult one. I agree with your general hypothesis and that the TBTF Banks control the markets and make money on either the up or down side, whichever is easier. I also agree that these same Banks make the call when and how to reverse the trend, probably over the weekend in quiet conversations.

However, with PM's it's a little different because The Fed is so desperate to stay in control of the Fiat Ponzi so cannot allow the PM's to go parabolic at this stage, whatever the cost. And the cost is relatively small when viewing the PM markets in the context of the FX and TSY markets.

So, IMHO, this might truly be a case of don't fight The Fed.

Byzantium
Dec 21, 2012 - 3:10am

The real target of the raids....?

Let's wind back to even the recent past, and the set-up that Andrew Maguire himself had described when a whistleblower.

JPM (being the operating arm of the Fed) was king of the silver jungle, the head of the food-chain.

The hyenas (the second tier of market players) accepted the hierarchy, and were the foot-soldiers. Collectively, they dominated the market.

When JPM signaled a price smash, these hyenas would front run it, and basically implement it. They not only did the heavy lifting (acting in concert, and finding strength therein) but provided JPM with the alibi of not having to get their own hands too dirty; 'it was the market wot done it.'

We heard recently, that the hyenas turned against their master, and started betting against him (her?), and that JPM was now the only short left in the market. JPM (read the FED) was facing the market alone.

Part of the reason for the discontent, was possibly that JPM had begun skimming, or even devouring the profits of some of these hyenas, and they were getting tetchy. So they turned on master. (Masters?)

Big mistake!

They are being shown who is boss. They are being shown that their choice is that of the relative (though abusive) safety of the former hierarchy, else severe market beatings. They are being shown that they are not even needed, but are simply useful.

If we can assume that other commodity markets also use the hyena model, then these hyenas clearly had to be taught a lesson, to now support once again JPM (the Fed) in preparation for the market tumult that will be 2013, and to respond immediately to the coded signals that they receive.

If you subscribe to this view, then the smack-downs will reverse once hierarchy is restored, and hyenas have skulked back to lay at master's feet again, having taken on the chin, the losses on their long positions. If this occurs, then we can expect same-old, same-old, in 2013.

Thoughts?

Zoltan
Dec 21, 2012 - 3:17am

Silver Lease Rates

Silver Lease Rates
Dec 21 2012 Change
1M -1.4093% -0.8400
2M -2.7860% -1.6300
3M -4.1000% -2.3600
6M -8.2597% -4.6200
1Y -14.9570%

-9.8600

Should have dragged my ass out of bed to post the previous update as they were not quite this crazy but I was too lazy.

This is fucking ridiculous.

For comparison here is gold.

Gold Lease Rates

December 20, 2012
1 m -0.1353% +0.0020
2 m -0.1100% +0.0045
3 m -0.0780% +0.0080
6 m 0.0603% +0.0085
1 y 0.3530% +0.0020

Source is Kitco (Iknow I know)

Zoltan
Dec 21, 2012 - 3:21am

Silver Lease Rates (Double)

Dec 21 2012 Change
1M -1.4093% -0.8400
2M -2.7860% -1.6300
3M -4.1000% -2.3600
6M -8.2597% -4.6200
1Y -14.9570%

-9.8600

1 m -0.1353% +0.0020
2 m -0.1100% +0.0045
3 m -0.0780% +0.0080
6 m 0.0603% +0.0085
1 y 0.3530% +0.0020

Earlier the one year rate was -9%. Price is holding up remarkably well considering.

Z

Einherjar
Dec 21, 2012 - 3:29am

Brazil Doubles Gold Reserves

Brazil Doubles Gold Reserves as Central Banks Buy Bullion

By Glenys Sim - Dec 21, 2012 9:10 AM GMT+0100

Brazil boosted gold reserves for a third month in November to double the country’s holdings since August as central banks from Russia to Belarus and South Korea add the metal to diversify their assets.

Brazilian holdings expanded 14.7 metric tons in November to 67.2 tons, the most since November 2000, according to data on the International Monetary Fund’s website. The country bought 17.2 tons in October after adding 1.7 tons in September, the first increase since 2008. Russia’s holdings increased 2.9 tons last month and Belarus’s reserves expanded 1.4 tons, the data show. Turkey pared holdings 5.9 tons and Mexico sold 0.1 ton.

Central banks have been expanding reserves as the metal heads for a 12th annual gain and investors hold a record amount in bullion-backed exchange-traded products. Nations bought 373.9 tons in the first nine months of the year and full-year additions will probably be at the bottom end of a range from 450 to 500 tons, the London-based World Gold Council estimates.

“Central banks, particularly in the emerging economies, are looking to increase the proportion of gold in their reserve assets,” Alexandra Knight, an analyst at National Australia Bank Ltd., said from Melbourne. “That will drive prices of gold because they can be quite significant purchases.”

Gold for immediate delivery traded at $1,647.41 an ounce at 4:09 p.m. in Singapore, up 5.4 percent this year. Still, the metal slumped to $1,635.70 yesterday, the cheapest since Aug. 22, as data showed the U.S. economy is improving.

Total Reserves

The proportion of gold as a share of total reserves is much smaller in emerging economies than advanced countries, and there’s probably going to be a continued push to increase the amount of metal held, Knight said.

The U.S., Germany, Italy and France hold more than 70 percent of their reserves in gold, according to data from the producer-funded WGC. The share in Brazil, the largest emerging economy after China, is 0.8 percent, the data show.

In October, Iraq sold 1 ton of bullion after buying 2.3 tons in September and 23.9 tons in August, according to the IMF data. The acquisition in August was the first by the country since at least 2004. There was no figure for last month.

In Asia, the Bank of Korea increased gold reserves 20 percent last month to diversify investments, boosting holdings for the fourth time since June 2011, according to a statement Dec. 5. Gold is a physical, safe asset, the Bank of Korea said.

Weaker Dollar

Gold has advanced as central banks from the U.S. to Europe and Japan ramp up stimulus to boost their economies, stoking concern that currencies will be debased and inflation may accelerate. The Dollar Index, a gauge against six counterparts has lost 1 percent this year, set for the first drop since 2009.

The U.S. Federal Reserve said Dec. 12 it would buy $45 billion of Treasury securities a month from January, adding to $40 billion a month of existing mortgage-debt purchases. The Bank of Japan expanded an asset-purchase program for the third time in four months yesterday.

Gold will probably peak in 2013 and keep declining the following year as U.S. growth accelerates, Goldman Sachs Group Inc. said in a report on Dec. 5. Immediate-delivery metal reached a record $1,921.15 an ounce in September 2011.

The metal is Morgan Stanley’s top commodity pick for 2013 on buying by central banks, geopolitical uncertainty and low so- called real interest rates, analysts including Peter Richardson and Hussein Allidina wrote in a Dec. 6 report. The bank expects bullion to average $1,853 an ounce next year.

Prices have been supported by so-called official-sector buying, David Gornall, chairman of the London Bullion Market Association, told a conference last month. China may add more to reserves as the metal accounts for a lower share of total holdings compared with the U.S., he said in Hong Kong. Official- sector buying was 439.7 tons in 2011, the highest since 1964.

Holdings in gold-backed ETPs reached a record 2,632.516 tons yesterday, and are 12 percent higher this year, data compiled by Bloomberg show.

Byzantium
Dec 21, 2012 - 3:42am

Chains of command

If we use armies and war as an analogy, then soldiers often do what soldiers do, regardless their own sentiment. They will participate in crackdowns against their own tribe, because instructed to.

The USA uses the deceit model, they convince their soldiers that bombing Iraqis, and whoever else, is safeguarding the lives of Americans. By contrast, Saddam Hussein (as an example) and former President Assad of Syria (the current incumbent's late father) presided over very diverse, tribal communities, the majority of whom did not offer heartfelt support. However, any one party who failed to show enthusiastic compliance, was brutally punished (and I mean brutally), and in fact, by other victims forced to do so. This was violent, abusive, nasty, but extremely tightly controlled hierarchy. The chaos in Syria today, is what happens when that model breaks down, and master is finally attacked. JPM does not want to experience this fate, so they are tightening their grip on the hyenas.

The silver market recently had its uprising against master, as we raced to $35, but the insurgents are now being brutally punished. Revisiting the Iraq analogy, Iraq showed that when an uprising is squashed (the Shia, the Kurds), then sentiment for further uprisings diminish, and people just knuckle down. When the US invaded in 2003, ostensibly as the liberators of the Iraqi Shia, they found that their toughest battles were with those same Iraqi Shia, who often fought to the death. Hierarchy can be a very strong force, and so I believe that what we are seeing might be the Fed restoring the hierarchy. For the hyenas to have gone long against the Fed in the silver market, is from the Fed's point of view, treason. A market whipping might only be the start; perhaps some of the ringleaders will be tragically 'suicided' in light of their inability to cope with losses associated with their bad decisions.

On the plus side, the hyenas were seeing something coming down the line, and decided to go AWOL. Whatever they saw coming, is still coming.

ivars
Dec 21, 2012 - 4:26am

GSR shot over 54 faster then

GSR shot over 54 and 55 faster then I expected yesterday as both silver and gold moved below their 200 day MA in wake of fiscal cliff stalemate.

All Fiats got a little stronger yesterday at different speeds as USA austerity would mark decline in speed of generation of strong powered new money (USD) which forms the basis for all convertible and pegged world currencies. via USG debt sales, so future potential growth of PMs could slow. That is the scenario that keeps PM prices suppressed right now. Does not mean they will not continue to grow even after fiscal cliff, but there might be new exponential bottom line established during bull market pullback.

Of course, if solved in a manner that does not reduce USG debt generation speed and future debt growth projections, PMs will jump right back to 34-35, and move on, so this is quite volatile and exciting time, difficult to trade.

We may see a slight move down in GSR and up in metals today even if fiscal cliff is not resolved yet. However, if its not resolved also on Monday the move up in GSR and down in metals may continue, and, if its not resolved at 26-28th, the move up in GSR and down in metals is guaranteed. As mentioned earlier, the ultimate bottoms seem to be 26 in silver and 1510 in gold IF fiscal cliff is not resolved this year, with GSR back into 58-59 region.

Concerning manipulation, if there is not enough big buyers for physical gold at these prices, which was seen at yesterdays London p.m. fix- no price movement up- It seems that smart money is staying away from purchases right now.

As to pitchfork, the one that was valid since Dec 12th is clearly broken, but the escape line below not crossed and now we have to wait and see if pitchfork bottom line (100) gets hit form the bottom today, and recoil- then there is new fork with downtrend to be found. If it reenters old fork- so far fine as long as it does not cross the median. If it does- new uptrend fork can be looked after:

In general i think today will be a small upday for metals, silver may be back into low 30- ties.

thurd aye
Dec 21, 2012 - 4:54am

Did you survive ? Hat tip if

Did you survive ?

Hat tip if you did. ;O))

achmachat
Dec 21, 2012 - 5:11am

aye

I did... and I didn't have to sleep on the couch!

mainly because tomorrow my son will be born and the wife told me that she doesn't want to know anything about silver anymore, unless "the Turd's" HEH arrives.

edit: ah... you mean the Maya thing? I thought you meant "survive the precious metals raid". :-p

koan
Dec 21, 2012 - 5:21am

Gotta love hindsight

I like Jesse's daily gold and silver charts https://jessescrossroadscafe.blogspot.co.uk/2012/12/gold-daily-and-silve... and never fails to amuse how I never see these moves coming but are so obvious in hindsight - the normal reach down to flush weak hands before taking off leaving as many behind cleaned out or too scared to jump on. Certainly 'appears' like we'll see 15xx on gold again - but then if it's so obvious (I channel the dumb money sentiment like a champ) we may well not (or goes even further than most think possible - 14xx!?!)...

Tis a bitch that it's blatant manipulation painting the charts but still they're so, well sort of, 'normal'.

Saying that, anyone else starting to get a tingle of anticipation - the ol' coiled spring - the lower it's pressed the higher and faster it'll rip! Just hope this one doesn't come back - not just another angst replaced with giddy elation as we make new highs then before you know it (a year or so) we're back here in the grip of angst again (back to higher levels than here of course but still manipulated). Getting old.

Here's hoping/looking forward to new enlightened times ahead (the true meaning of the mayan calendar, whether you believe in it or not)...

boatman
Dec 21, 2012 - 5:32am

it's "PERCEIVED DEFLATION".........+monkey EE attacks

going over the BS 'farcical cliff' is perceived deflation of course!...........helicopter ben just takes a backseat to it for now.

raise taxes, cut everything a little and no debt ceiling rise............how is that not deflationary?

minus the tax increase it's what is NEEDED to be done anyway.

then there is the always-looking-for-a-toehold-manipulating 'shorts'....course IF they were all powerful, gold would be 900$

good is the 'relative dollar weakness'.................its flat approximately....of course SOME of that is 'bounce-back' of the dollar/yen after the pop from the japanese elections........euro strength cause the spotlight is off of them for now.

in retrospect, its all clear...........like most things are.

like sausage, they will eventually get it done dirty............looking at probably new gold high by may

Torpedo Fish
Dec 21, 2012 - 5:45am

@Bill of Rights

Thanx for the video, It was clear from the first moment it's another CIA operation like the one before in cinema.

koan
Dec 21, 2012 - 5:52am

zoltan - lease rates

Anyone seen levels like this before? If I recall correctly -4% has preceded a couple of big raids - but -14+%?! Too much to hope this is the last gasps of a dying paper game?

I Run Bartertown
Dec 21, 2012 - 6:13am

achmachat

"tomorrow my son will be born"

Congratulations!

I like him already...coming into the world on the day it was supposed to end...a born contrarian!

boatman
Dec 21, 2012 - 6:22am

no 1099 needed gold coins at 2.75% premie

and the 1099 rules on gold/silver.

for an older guy not worried about leaving anything to anybody, and giving Mad Max scenario about a 5% chance, there will be a time to sell...........at 300% UP +................. about 3-6 years from now.

but, hey, anyone that wants to die holding this stuff------------have at it.....

i want to die pennyless/ounceless/SDRless having spent 90% of it on fun, fishing, beer, [used to be women HERE]....

the rest of it i'll just piss away.

https://dollarcollapse.com/precious-metals/tom-cloud-how-to-sell-gold-wi...

Bollocks
Dec 21, 2012 - 6:31am

Those Mayans...

...need to sort out their end-of-the-world shit. I didn't feel a thing.

When's the next one?

Bollocks
Dec 21, 2012 - 6:37am
Sisyphus
Dec 21, 2012 - 6:37am

Never mind.

They'll be plenty more 'end-of-the-world' predictions next year, and the year after,and....

S Roche
Dec 21, 2012 - 6:39am

Charts...

If chart-haters spent as much time studying as complaining we might all be better off.

Some Screwtape commentators hate them too on this thread: https://screwtapefiles.blogspot.com.au/2012/12/on-keeping-my-little-lemu... , so I posted this:

And yes, I have been trading it by being flat or long... like from $1635ish overnight. Never any guarantees, but better to have it than not. This type of chart was the subject of Paul Coghlan's webcast that Turd arranged. It is fractal, so any time frame can work.

achmachat
Dec 21, 2012 - 6:40am

Bartertown

Thanks! And he even has his own silver stash already. It's never too early to start.

koan
Dec 21, 2012 - 6:59am

achmachat

With you on that - figured it's time my girls (3 & 5) got started - silver britannias & jewellery from me this xmas (let my better half buy them the stuff they actually want!).

Plus a 120 piece silver (plated) cutlery set for us all to use - figured we may as well get some use from silver (silver spoon in the mouth and all that) and these sets aren't going to get any cheaper. Still might add a solid set in the new year as a family heirloom (wealth preservation with health benefits and style!).

tpbeta
Dec 21, 2012 - 7:07am

More than chart painting

Might it be that Blythe and co are trying to do more than paint the chart, and paint decoupling - from QE, from the stock market, from growth. That would be a good way to avoid the problems of 2013.

ClinkinKY thurd aye
Dec 21, 2012 - 7:45am

@ thurd aye---Did you survive ? Hat tip if

Hey, it "ain't over till the fat lady sings":)

(Man, it sucks to be computer challenged. Tried to post a widget showing that there is still approximately 16 hours left for "end of the world". Suffice to say that if Michael Moore starts singing at 11:59 P.M....kiss your ass goodbye:)

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