ChartDaddy Returns

203
Tue, Jan 8, 2013 - 1:36pm

This is way more charts than I've ever given you in one post. I hope you're ready.

For now, the metals are both being contained below their 200-day moving averages of gold at $1667 and silver at $30.82. So, while the metals continue in a holding pattern, I thought that today would be an excellent day to give you this massive update and, perhaps, make some general assumptions about 2013.

The problem with doing this is knowing where to start and how to put these into an order that makes some sort of logical sense. Since "logical sense" eludes me at this moment, I'm just going to dump them on you, instead.

First up, here are daily charts of the euro and copper. Note how closely they tracked each other through 2012. Actually, it would probably be more accurate to say "look how closely copper tracked the euro". Also notice how both declined in mid-December but recovered in late December.

Now look how closely silver has also tracked the euro in 2012. Note that silver fell in mid-December, too, but did not see the rebound that copper did. Hmmm. Is paper silver undervalued by 10%?

Next, let's look at the bond market. I've suggested to you that QE of $85B/month is not enough to fund the 2013 deficit, which looks to be in the $1.6-1.7T range. Falling prices/rising rates would also suggest that more Fed "support" is needed in the bond market. My guess is we'll see it soon...probably when the 10-year approaches the 127-128 level and the Long Bond is threatening to break down through 140.

Let's begin the currency discussion with the POSX. Remember and never forget that the POSX is simply a reflection of The Pig versus other rapidly-devaluing fiat currencies. The fact that the POSX is flat over the past five years only means that other global fiat have declined in value by an equivalent amount.

So, in that context, look at The Pig vs the yen. Yikes! Were you aware of this? We'll definitely need to watch this relationship over the next few weeks and months.

Another very interesting currency chart is the Swissie. From mid-2010 through mid-2011, the Swiss franc rallied almost 40% as it was perceived to be the final and only "safe haven" fiat currency. Well, the Swiss didn't like that too much as they keynesian-foolishly feared that a strong franc would wreck their economy. So, they did what all centrally-planning keynesians do, they devalued by pegging the swissie to the euro in early September of 2011. (Recall, too, that this left gold as the only remaining "safe haven" currency and it was carpet-bombed a full five minutes before the announcement was made and has been firmly held in check ever since.) Well, now, the swissie (and, by extension, the euro) has begun to form a massive, bowl-shaped bottom on this weekly chart. Hmmmm....could this foretell a POSX breakdown in 2013?

Let's now switch to crude, where a trading opportunity may be developing. (Full disclosure: Like most everything else, I missed the boat quite often in crude in 2012.) Look at these charts. A pullback to 91-92 would sure seem to present a buying opportunity for a move to 98-100. From there, a consolidation would paint the chart with a massive, cup-and-handle formation and would make the chart look like 115+ by mid year.

The old adage among grain traders is "buy on Valentine's Day and sell on Mother's Day". That strategy certainly looks like a good idea in 2013, too. The drought in the U.S. Midwest has not lessened at all this winter ( https://droughtmonitor.unl.edu/12_week.gif) so you can rightly expect some rapid gains this spring if the next growing season begins dry, too. I'll definitely be looking to dabble in beans next month, especially if price can fall a bit further, toward $13.

And this is interesting. Have you been to the market lately and thought, "Damn, that shit's expensive" when looking at steaks and burgers? If so, this next chart will show you why. It's a weekly chart of Live Cattle and note that since the advent of Quantitative Easing in 2009, beef prices have risen over 60%. Is your salary up by 60%, too? No? Hmmm...the major problem here is that soaring "protein" prices will ultimately lead to civil unrest, first in the 3rd world but, eventually, here in The West, as well. Watch this closely in 2013 as it has the potential to develop into a real problem.

And get a load of this next chart...Lumber. Apparently lumber didn't get the memo post-QE∞. Since mid-September, it's up over 40%. Permanently low rates means a housing recovery? I don't think so but clearly the lumber market does! Either this sucker rolls over soon or, eventually, a lot of other commodities are going to have to play catch up. Another chart to watch closely in the weeks and months ahead.

And, finally, here's the S&P. I guess we're all just dumb-as-a-box-0f-rocks for buying metal over the past four years when we could have been buying and holding stocks, instead. UP over 100% since the initiation of Quantitative Easing in March of 2009, more than just about any other paper "asset" and you get a dividend! Isn't it interesting that all of this money printing leads stocks higher than everything else? Gee, I wonder why that could be?

Perhaps THIS has a little something to do with it. Please take the time to read this very important and informative article from ZH. It's one of the most important things they've written in quite a while. https://www.zerohedge.com/news/2013-01-07/dear-steve-liesman-here-how-us-financial-system-really-works

And buried within that article is the paragraph near-and-dear to my heart and the hearts of all of Turdville. This is the mechanism through which JPM conceals their manipulative actions from the CFTC and everyone else:

"Now the JPM spin is well-known: the CIO was merely there to "hedge" exposure, as a direct prop bet would be illegal as per the Volcker Rule, not to mention the avalanche of lawsuits and the regulatory nightmare that would ensue if it became clear that the firm was risking what amounts to deposit capital to fund massive, highly risky prop trading bets. Which, when one cuts out the noise, is precisely what JPM did of course, especially since the "hedge" trade blew up just as the market tumbled in the spring of 2012, a time when it should have otherwise hedged the balance of the firm's otherwise bullish posture. That it did not do this refutes the logic that this was a hedge, and confirms that what JPM was doing was nothing short of using an internal, heavily shielded hedge fund, which had $323 billion in collateral as investable equity, to trade away, knowing very well no regulator would dare touch JPM."

OK, that's all for today. I look forward to reading your comments.

TF

About the Author

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

  203 Comments

  Refresh
treefrog
Jan 9, 2013 - 1:14pm

i found this rant on another site

You know you live in a Country run by idiots if…. An 80 year old woman can be stripped searched by the TSA but a Muslim woman in a burka is only subject to having her neck and head searched. You know you live in a Country run by idiots if…. You can get arrested for expired tags on your car but not for being in the country illegally. You know you live in a Country run by idiots if… Your government believes that the best way to eradicate trillions of dollars of debt is to spend trillions more of our money. You know you live in a Country run by idiots if…. A seven year old boy can be thrown out of school for calling his teacher “cute” but hosting a sexual exploration or diversity class in grade school is perfectly acceptable. You know you live in a Country run by idiots if….. The Supreme Court of the United States can rule that lower courts cannot display the 10 Commandments in their courtroom, while sitting in front of a display of the 10 Commandments. You know you live in Country run by idiots if…. Working class Americans pay for their own health care (and the health care of everyone else) while unmarried women are free to have child after child on the “State’s” dime while never being held responsible for their own choices. You know you live in a Country run by idiots if…. Hard work and success are rewarded with higher taxes and government intrusion, while slothful, lazy, promiscuous behavior is rewarded with EBT cards, WIC checks, Medicaid and subsidized housing, and free cell phones. You know you live in a Country run by idiots if…. The government’s plan for getting people back to work is to provide 99 weeks of unemployment checks (to not work). You know you live in a Country run by idiots if…. Being self-sufficient is considered a threat to the government. You know you live in a Country run by idiots if…. Politicians think that stripping away the amendments to the constitution is really protecting the rights of the people. You know you live in a Country run by idiots if…. The rights of the Government come before the rights of the individual. You know you live in a Country run by idiots if…. Parents believe the State is responsible for providing for their children. You know you live in a Country run by idiots if…. You can write a post like this just by reading the news headlines. You know you live in a Country run by idiots if…. You pay your mortgage faithfully, denying yourself the newest big screen TV while your neighbor defaults on his mortgage (while buying iphones, TV’s and new cars) and the government forgives his debt and reduces his mortgage (with your tax dollars). Your government can add anything they want to your kid’s water (fluoride, chlorine, etc.) but you are not allowed to give them raw milk. You know you live in a Country run by idiots if…. Being stripped of the ability to defend yourself makes you “safe”. You know you live in a Country run by idiots if…. You have to have your parents signature to go on a school field trip but not to get an abortion. You know you live in a Country run by idiots if…. Using the “N” word is considered “hate speech” but writing and singing songs about raping women and killing cops is considered “art”.

The saddest part is that we all elected these idiots! They have a 6% approval rate yet a 97% retention rate.

Mudsharkbytes
Jan 9, 2013 - 1:11pm

Isn't that nice…

Faceplant, I mean FaceBOOK and silver have crossed again.

It sickens me to say this, but now a share of Face-waste-of-time is worth more than an ounce of silver.

gack………

Big L
Jan 9, 2013 - 1:07pm

Doesn't matter what you like to do.....

The government knows better. Even if you're a dog......

Beginning Jan. 1 it became illegal to use packs of dogs to chase, corner, and ultimately shoot down bears and bobcats in California. Backers of the law say it’s not only unfair to the hunted animals but also potentially dangerous and borderline abusive to the dogs.

Right, abusive to let hunting hounds hunt. Obviously they'd be much better off doing something else, instincts be damned.


Read more: https://www.care2.com/greenliving/california-law-bans-hunting-hounds.html#ixzz2HVE4tuaR
SIlverbee
Jan 9, 2013 - 12:09pm

The Turdmeister

is using his pink sharpie today.

:emoticonofeyesleftandright:

indosil
Jan 9, 2013 - 11:49am

Fed Now Pre-Monetizing: Bernanke Buys $300 Million Of Treasury T

Fed Now Pre-Monetizing: Bernanke Buys $300 Million Of Treasury To Be Auctioned Off Tomorrow Submitted by Tyler Durden on 01/09/2013 11:24 -0500

  • Ben Bernanke
    • Debt Ceiling
      • Monetization
        • POMO


        • There was a time when the Fed would repurchase freshly issued bonds a month, a week, or even a day afterthey were auctioned off by the Treasury (to avoid that whole perjury-inducing "no monetization" stigma). That's no longer the case. Moments ago the Fed concluded its most recent POMO as part of the now unsterilized QE4EVA, focusing on 2036-2042 maturities, i.e., the long-end. A quick look at the issues bought shows that the one CUSIP most put back by dealers to the Fed was the 912810QY7 30 Year. Curiously this is precisely the same CUSIP that, despite the debt ceiling being breached and all, will be auctioned off... tomorrow. Granted, it is a reopening (29 year, 10 month issue), but in a world in which nothing financial makes sense, and idiots come up with debt ceiling avoidance "schemes" that could have rolled right off a Lewis Black rant, we prefer to think of itsas pre-monetization, much the same as pre-crime. That said, our hopes that Spielberg will consider putting the script of Monetization Report into a movie, with Paul Giamatti reprising the role of the man who prints the world, will likely not come true.

          Note the highlighted Cusip just monetized by the Fed...

          ... And the link to tomorrow's 912810QY7 auction.

          Finally, since the Fed is no longer in the sterilized monetization business, but has reverted to the bazooka approach, it means POMO days are once again critical as then the Primary Dealers will end up with substantial cash dry powder, to be used to ramp stocks and for other general excess reserve permitting purposes.

          Which is why here is the full calendar of January POMO dates: it may not be a good idea to be short stocks on any of the days listed below.

StevenBHorse
Jan 9, 2013 - 11:37am

cbo

That data is aggregated from the Daily Treasury reports. The market is already well aware of these figures.

You are grasping at straws.

It's a $10 move, which is fucking noise.

The price is down because of supply and demand.

99% of market action makes commentary, go read Shitco.com for verification of this fact.

ivars
Jan 9, 2013 - 11:33am

@ achmachat @Dr Jerome

Of course any news will be used for selling , and i have noticed the usual timing, however, these news by definition were straight on target PM negative. If I was not PM bull I would have sold on those news and met not so big resistance. Obviously, it was known before to many - I do not know if CBO reports are also scheduled for stock markets , exactly timed.

These were not CBO projections, but financial statement about the past quarter deficit. It can of course be doctored but definitely not so much as projections where the sky is the limit.

May be they prevented from PMs moving higher as they had been promising today- the news, I mean. These news are also obviously USD positive vs. negative news coming out from Eurozone, as EUR is tanking today after 2 days of resurrection.

Just got info that these news were out yesterday during open hours (?) , so they can not be direct cause to seloff, but extend some upwards pressure on USDx nevertheless.

GS_PHYS
Jan 9, 2013 - 11:08am

Guys, There is escalation on

Guys, There is escalation on India-Pak border. Hope that is not the cause. ;)

Jan 9, 2013 - 11:03am

CBO projections

Ivars,

I am not sure I trust anything the CBO projects. So far I have not heard 0f any deficit reduction and every time congress has what they think 9s extra money, they spend it. Perhaps we should chart the Debt clock and see what the real numbers are. But I agree that it is a good reason to squash metals. The algos don't think like we do--they only react to news and commands.

achmachat
Jan 9, 2013 - 11:03am

Ivars, the real reason for the PM price fall...

Dagney was right to point out that 3-day chart.

The cartel had to follow the most important rule:

DON'T CROSS THE STREAMS!

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 10/26

10/27 8:30 ET Durable Goods
10/27 10:00 ET Case-Shiller home prices
10/27 10:00 ET Consumer Confidence
10/27 10:00 ET Richmond Fed
10/28 8:30 ET Advance Trade in Goods
10/28 8:30 ET Wholesale Inventories
10/29 8:00 ET ECB monetary policy stmt
10/29 8:30 ET Q3 GDP first guess
10/30 8:30 ET Personal Income and Spending
10/30 8:30 ET Core Inflation
10/30 10:00 ET UMich Consmer Sentiment

Key Economic Events Week of 10/19

10/19 11:45 ET Goon Chlamydia
10/20 8:30 ET Housing Starts
10/20 1:00 pm ET Goon Evans
10/21 10:00 ET Goon Mester
10/21 2:00 pm ET Fed Beige Book
10/22 8:30 ET Initial Jobless Claims
10/23 9:45 ET Markit Oct flash PMIs

Key Economic Events Week of 10/12

10/13 8:30 ET CPI and Core CPI
10/14 8:30 ET PPI
10/14 9:00 ET Goon Chlamydia
10/15 8:30 ET Philly Fed
10/15 8:30 ET Empire State Idx
10/15 8:30 ET Import Price Idx
10/16 8:30 ET Retail Sales
10/16 9:15 ET Cap Ute & Ind Prod
10/16 10:00 ET Business Inv

Key Economic Events Week of 10/5

10/5 9:45 ET Markit Svc PMI
10/5 10:00 ET ISM Svc PMI
10/5 10:45 ET Goon Evans
10/6 8:30 ET Trade Deficit
10/6 10:00 ET JOLTS job openings
10/6 10:45 ET Chief Goon Powell
10/7 2:00 ET Sept FOMC minutes
10/7 3:00 ET Goon Williams
10/8 8:30 ET Initial jobless claims
10/9 10:00 ET Wholesale Inventories
10/9 12:10 ET Goon Rosengren

Key Economic Events Week of 9/28

9/29 8:30 ET Advance trade in goods
9/29 9:00 ET Case-Shiller home prices
9/29 10:00 ET Consumer Confidence
9/30 8:15 ET ADP employment report
9/30 9:45 ET Chicago PMI
10/1 8:30 ET Personal Income and Spending
10/1 8:30 ET Core Inflation
10/1 9:45 ET Markit Manu PMI
10/1 10:00 ET ISM Manu PMI
10/2 8:30 ET BLSBS
10/2 10:00 ET Factory Orders

Key Economic Events Week of 9/21

9/21 8:00 ET Goon Kaplan
9/21 10:00 ET Goon Evans
9/21 Noon ET Goon Brainard
9/21 6:00 pm ET Goon Williams & Goon Bostic
9/22 10:30 ET Chief Goon Powell on Capitol Hill
9/22 Noon ET Goon Barkin
9/22 3:00 pm ET Goon Bostic again
9/23 9:00 ET Goon Mester
9/23 9:45 ET Markit flash PMIs for September
9/23 10:00 ET Chief Goon Powell on Capitol Hill
9/23 11:00 ET Goon Evans again
9/23 Noon ET Goon Rosengren
9/24 1:00 pm ET Goon Bostic #3
9/24 2:00 pm ET Goon Quarles
9/24 10:00 ET Chief Goon Powell on Capitol Hill
9/24 Noon ET Goon Bullard
9/24 1:00 pm ET Goon Barkin again & Goon Evans #3
9/24 2:00 pm ET Goon Bostic #4
9/25 8:30 ET Durable Goods
9/25 11:00 ET Goon Evans #4
9/25 3:00 pm ET Goon Williams again

Key Economic Events Week of 9/14

9/15 8:30 ET Empire State and Import Price Idx
9/15 9:15 ET Cap Ute and Ind Prod
9/16 8:30 ET Retail Sales
9/16 10:00 ET Business Inventories
9/16 2:00 ET FOMC Fedlines
9/16 2:30 ET Powell Presser
9/17 8:30 ET Philly Fed
9/18 8:30 ET Current Acct Deficit

Key Economic Events Week of 9/7

9/9 10:00 ET JOLTS job openings
9/10 8:30 ET Initial jobless claims
9/10 8:30 ET PPI
9/10 10:00 ET Wholesale Inventories
9/11 8:30 ET CPI
9/11 9:45 ET Core CPI

Key Economic Events Week of 8/31

9/1 9:45 ET Markit Manu Index
9/1 10:00 ET ISM Manu Index
9/1 10:00 ET Construction Spending
9/2 8:15 ET ADP employment
9/2 10:00 ET Goon Williams
9/2 10:00 ET Factory Orders
9/3 8:30 ET Initial jobless claims
9/3 8:30 ET Trade Deficit
9/3 12:30 ET Goon Evans
9/4 8:30 ET BLSBS

Key Economic Events Week of 8/24

8/24 8:30 ET Chicago Fed Idx
8/25 10:00 ET Consumer Confidence
8/26 8:30 ET Durable Goods
8/27 8:30 ET Q2 GDP 2nd guess
8/27 9:10 ET Chief Goon Powell Jackson Hole
8/28 8:30 ET Pers Inc and Consumer Spend
8/28 8:30 ET Core Inflation
8/28 9:45 ET Chicago PMI

Recent Comments

by murphy, 44 min 47 sec ago
by AgstAger, 49 min 11 sec ago
by bpete, 54 min 40 sec ago
by OceanX, 1 hour 21 min ago
by scuba_trader, 1 hour 26 min ago

Forum Discussion

by HappyNow, 6 hours 55 min ago
by 11IMIX, Oct 28, 2020 - 8:49pm
by Alembic, Oct 28, 2020 - 8:26pm
by Pete, Oct 28, 2020 - 5:20pm
randomness