Friday Gold Theatrics

Fri, Apr 12, 2013 - 10:52am

A concerted effort was made this morning to smash gold through the bottom of its 18-month range. It failed. However, you can be certain that they will try again so you need to keep a few things in perspective.

First of all, perhaps you need a reminder that we've been discussing this possibility for weeks. If you missed any of these posts, perhaps today would be a good day to go back and review them.

So, at 5:00 a.m. EDT this morning, the attack commenced. The plan was to drive prices down enough in the pre-market that, when the Comex opened at 8:20 a.m. enough sell-stops would be triggered that would break gold down through $1525 and then the thing would take on a life of its own. Below $1525 undoubtedly lay a veritable cornucopia of sellstops that, if/when triggered, will send price momentarily plunging. Earlier today, they failed. Price in the June13 gold bottomed at $1525.60. But don't worry, they'll be back. Maybe as soon as later today (after the PM fix?) or Monday. Will they fail again or will we get The Final Washout as we've been mentioning? We'll see...

Here's the 5-minute chart from earlier today where you can see the action in all its glory. Again, note the selling in the final 10 minutes before the open that lowered price from $1544 to $1536. This was the final attempt at mustering enough selling to prompt a washout at 8:20. It didn't work. Yes, price immediately fell $10 at the open but, again and significantly, it stopped at turned at $1525.60.

OK, so where are we on the long-term charts? I apologize for having to use these FTC charts but they're the only ones that I can access that show the "continuous" price. You should be able to click on them to expand them. NOTE THE LOWS IN RED.

Look, as stated above, I can't imagine that they're not going to try again soon. The Spec Momos might even get a little help from The Forces of Darkness. I mean, shoot, why not? All of the selling that will materialize below $1525 will allow The Cartels to cover all kinds of additional shorts. Again, we'll see. But you have to be prepared, both mentally and financially, for this to happen. Both gold and silver are historically oversold from a CoT perspective. To remind you of this and to prepare you for today's CoT, let's go back and look at the CoT structures from the lows on the charts above.

On 12/27/11, as gold was bottoming at $1525, the weekly Commitment of Traders Report looked like this:

  • LargeSpec longs 167,413. LargeSpec shorts 36,625. Net long ratio 4.57:1
  • SmallSpec longs 57,327. SmallSpec shorts 24,183. Net long ratio 2.37:1
  • Gold Cartel longs 162,522. Cartel shorts 326,454. Net short ratio 2.01:1
  • Total open interest 418,945
  • On 5/29/12, the Commitment of Traders Report looked like this:

    • LargeSpec longs 167,439. LargeSpec shorts 56,727. Net long ratio 2.95:1
    • SmallSpec longs 49,856. SmallSpec shorts 29,859. Net long ratio 1.67:1
    • Gold Cartel longs 170,208. Cartel shorts 300,917. Net short ratio 1.77:1
    • Total open interest 419,991

    Last week (and today's will be even more dramatic), the CoT looked like this:

    • LargeSpec longs 202,634. LargeSpec shorts 82,428. Net long ratio 2.46:1
    • SmallSpec longs 52,253. SmallSpec shorts 29,937. Net long ratio 1.75:1
    • Gold Cartel longs 137,205. Gold Cartel shorts 279,727. Net short ratio 2.04:1
    • Total open interest 417,176

    So I ask you: What is different this time? Nothing! No, I take that back. The only real difference is the amount of disinformation and SPIN trying to convince you to sell your metal and convert it back to fiat. Other than that, NOTHING! And wait until we get the updated report today! I'll be sure to update this post and show the numbers in an identical format so that you can make an easy comparison over the weekend.

    Let's move on to silver. On 12/27/11, the silver CoT looked like this:

    • LargeSpec longs 24,026. LargeSpec shorts 17,171. Net long ratio 1.40:1
    • SmallSpec longs 20,294. SmallSpec shorts 13,017. Net long ratio 1.56:1
    • Silver Cartel longs 41,224. Silver Cartel shorts 55,356. Net short ratio 1.34:1
    • Total open interest 103,993

    Then, on 6/19/12, the CoT looked like this:

    • LargeSpec longs 27,767. LargeSpec shorts 17,665. Net long ratio 1.57:1
    • SmallSpec longs 21,704. SmallSpec shorts 14,852. Net long ratio 1.46:1
    • Silver Cartel longs 47,447. Silver Cartel shorts 64,401. Net short ratio 1.36:1
    • Total open interest 122,508

    And last week (7 trading days ago and with OI 11,000 lower) look like this:

    • LargeSpec longs 38,201. LargeSpec shorts 30,055. Net long ratio 1.27:1
    • SmallSpec longs 27,211. SmallSpec shorts 16,854. Net long ratio 1.61:1
    • Silver Cartel longs 57,847. Silver Cartel shorts 76,350. Net short ratio 1.32:1
    • Total open interest 155,755

    So, what's different in silver? A LOT! Well...not really that much. The net ratios are almost identical to where they were at bottoms in the past. But look at the size! The Specs are gross short 50% more contracts than at past lows and the Commercials are long more contracts than ever before. And this was last week! When open interest was 155,755! As of this Wednesday (2 days ago), the total OI had grown to 166,621! How do you suppose the ratios and the total look at this moment?? Perhaps more bullish than I ever conceived possible?!?! Again, we'll at least get an update through Tuesday later this afternoon and I'll post it into this thread once it's released.

    As I go to hit "SEND" I see that "they" have finally succeeded in dropping price through $1525. Funny how this has happened immediately following the London PM fix. So, there you go. Look for a "V" bottom very soon and a sharp rebound by later today or Monday. This is it! This is what we've been waiting for...A final, capitulative, sell-stop running Washout. Let it run its course and then let's see what happens next.


    4:10 p.m. EDT UPDATE:

    Well, I suppose I could go on all afternoon about what transpired today but much of that has been covered in the comments of this thread. Therefore, I'll just stick to two things. This afternoon's Globex action and your CoT update.

    Here's a 1-minute chart of the sharp selloff this afternoon on the Globex. This looks like a margin liquidation to me. Why on earth would an actual person wait until 3:20 in the afternoon to sell into the low-liquidity Globex? Either way, it doesn't make anyone any more confident heading into Monday.

    This week's CoT is out and it wasn't quite as interesting as I'd hoped. In gold, where price rose $11 on an OI change of just 663 contracts, I didn't expect much...and I received little in return. The LargeSpecs reduced their net long by 800 contracts. The SmallSpecs added 2100 net longs and The Cartel added 1300 net short.

    The silver report was surprising, though, in that hardly any changes took place in the Spec category, even though price rose 63¢ for the week and OI rose by 6,486.

    The silver LargeSpecs added 300 longs and also added 500 shorts. The SmallSpecs sold 1400 longs and covered 1100 shorts. THE REAL ACTION and, once again perhaps the brewing Civil War, was in the Commercial space. JPM and their two pals added 2,634 new shorts, bringing their total back up to 78,984. Why did they do that? Because the other commercials added 3,213 new longs, bringing their total to an astonishing 61,060! All of this buying and selling drops the Silver Cartel net short ratio back to 1.29:1.

    Here's how silver looks when presented as it was earlier in this post:

    • LargeSpec longs 38,492. LargeSpec shorts 30,577. Net long ratio 1.26:1
    • SmallSpec longs 25,754. SmallSpec shorts 15,745. Net long ratio 1.64:1
    • Silver Cartel longs 61,060. Silver Cartel shorts 78,984. Net short ratio 1.29:1
    • Total open interest 162,241

    Keep in mind that, as of Wednesday night, silver OI had surged to 166,621 before falling back yesterday to 164,393. Since it appears that The Specs were not adding additional shorts this week, it is unlikely that they became net short as a category. It is also not true that the silver commercials have moved net long. At least not yet.

    However, DO NOT DISMISS the significance of the action pitting nearly everyone in the commercial space against JPM. The action since Tuesday is almost certainly related to the anger JPM must feel at the audacity shown by those who are seemingly attempting to challenge them.

    If we survive the weekend, Monday and the rest of next week are certainly going to be...uhh...interesting. Get some rest and relaxation this weekend. You're going to need it.


    About the Author

    turd [at] tfmetalsreport [dot] com ()


    Apr 12, 2013 - 10:52am


    To say FUBM

    Apr 12, 2013 - 10:54am


    And on a day in which I have never felt such uncertainty in what I am doing

    Apr 12, 2013 - 10:54am

    I really should get to work



    P.S. only thing to do on a day like this is visit LCS at lunch and pick up some stackin material

    Just A Regular Guy
    Apr 12, 2013 - 10:55am

    Down 3% almost

    Holy crap batman!


    Apr 12, 2013 - 10:55am

    bart c

    I emailed bart this am and actually asked him if they were looking at the trades. he said we are looking and i responded by saying "ok but why are you never doing anything"..see he's reponses

    Chilton, Bart

    Fri, Apr 12, 2013 at 9:53 AM
    Reply | Reply to all | Forward | Print | Delete | Show original
    Well, if we find something we do something, although of we are investigating, we aren't allowed to discuss it. But we do look, in detail at trades--particularly large positions. Many times, however, what we see isn't "right" in my book, but not against the law. We see a lot of HFT cheetah traders in the pm markets, for example. Without saying anything I'm prohibited from saying: what we have seen ain't what some in the pm community suggest. There isn't currently one large firm with huge short positions trading to keep prices down.
    Finally, when prices rise, we never hear a peep. When they go down, my mailbox fills. I understand that, and I know it is frustrating to folks. I wish we would explain some of this in a public conference call--perhaps regularized. Even take questions from folks. Again, we'd have to be careful about not giving out trader info, but it could be done.

    NOTE: "Ponzimonium: How Scam Artists Are Ripping Off America" is now in its second printing and available for Nook at, and for Kindle at Hard copies may be ordered at either site, or at Neither the CFTC nor Commissioner Chilton receive any proceeds from the sale.

    ----- Original Message -----
    Sent: Friday, April 12, 2013 09:33 AM Eastern Standard Time
    To: Chilton, Bart
    - Show quoted text -
    Reply | Reply to all | Forward | Print | Delete | Show original

    Chilton, Bart

    Fri, Apr 12, 2013 at 9:57 AM
    Reply | Reply to all | Forward | Print | Delete | Show original
    And FYI if you don't know, looking at it, gold and silver weakened most between around 7:40am and 8:20am this morning, before stabilizing after poor U.S. retail sales data was released at 8:30am. There were some comments from the European Central Bank and Cyprus this morning about potential Cypriot gold sales as part of its bailout, although this development has been in the market for a couple of days. Goldman Sachs, Citibank, Deutsche Bank and Saxo Bank all lowered their gold price expectations this week.
    Mr. Fix
    Apr 12, 2013 - 10:55am

    Fifth Again?

    Fifth it is fine, but it's starting to set a trend here.

    Apr 12, 2013 - 10:56am
    Apr 12, 2013 - 10:56am


    A well regulated militia being necessary to the security of a free state, the right of the people to keep and bear arms shall not be infringed.

    Time to go buy some gold, silver, and bitcoins!

    Apr 12, 2013 - 10:56am

    Damn I'm tempted

    That silver price looks awfully cheap.

    Apr 12, 2013 - 10:58am

    Me too

    But no cash left

    Dr G
    Apr 12, 2013 - 10:59am

    Do NOT buy here. These will

    Do NOT buy here. These will NOT be the lows. There is ZERO momentum to the upside. Gold will have a 14xx handle VERY soon and silver will likely drop to a 25 handle.

    Hope everybody that enjoys King World News is learning that they are the #1 supplier of misinformation on the bull side when it comes to metals. MSM is bearish, KWN is bullish. The truth lies in between.

    Apr 12, 2013 - 11:04am

    I have to say my faith is shaken

    Starting to feel foolish. The disinfo propaganda and manipulation is working.

    Talk me off the ledge people. Whisper sweet fundamentals in my ear as they shrivel up. Not in the fetal position on the floor yet, but it's going to be a large beer at the mexican joint for lunch today folks.

    Bitcoin . . . silver and gold . . . seems like the establishment is going all out war, reeking of desperation . . .

    Just A Regular Guy
    Apr 12, 2013 - 11:05am

    Just Wow

    The smash down is incredible!
    Oil/Gold/Silver/Copper all getting pounded, stocks in the EU about -1.5%, bonds are up though (phew!)....

    Deee-flationary crash anyone?

    Apr 12, 2013 - 11:06am
    Apr 12, 2013 - 11:06am



    Apr 12, 2013 - 11:07am
    Apr 12, 2013 - 11:08am

    I feel kind of like this when

    I feel kind of like this when I see these kinds of price moves.

    Apr 12, 2013 - 11:08am

    They're not done

    Oh boy, can you imagine the MSM articles?

    Jan Roos
    Apr 12, 2013 - 11:10am

    Yeah i also amstarting to

    Yeah i also amstarting to believe we are all being had. Maybe not when you got in 5 or 10 yeats ago but this bull market seems finished and we are here investing our life savings by listening to propoganda such as every down move is a coordinated attack by the cartel. Gimme a break and god I feel dumb for listening to thi shit for so long.

    Apr 12, 2013 - 11:11am

    Two big stops taken. They are

    Two big stops taken. They are going after Asian market Monday morning :) They want it all. lol.

    Kick back and enjoy the fireworks. They are giving us quite a show. If you have phyzz, chill out.

    Apr 12, 2013 - 11:12am

    Final washout

    I thought all the action was in bitcoins, but check out gold n silver! This is crazy. Perhaps I should buy a bit more phiz

    Loud Noises
    Apr 12, 2013 - 11:12am

    Gold 14 handle

    Gold 14 handle

    Mr. Fix
    Apr 12, 2013 - 11:12am

    Of course you buy here, (if you still can)

    Exactly how long do you expect the physical market to respect these prices?

    The price will continue to fall until there is absolutely no metal left for delivery anywhere.

    It is literally now or never.

    Apr 12, 2013 - 11:13am

    2 years of beatings. I've

    2 years of beatings. I've about had it.

    Apr 12, 2013 - 11:13am

    The Balloon Went Up

    Just not the one I thought...

    14XX! Looks like Stratajema was right, just about 12 months off.

    This sucks, but what sucks even more is that it seems like there are no more fundamentals to talk us off the ledge. Every time we think we have an idea of what should happen it doesn't. So there are two options-

    1) We are all a bunch of F...king idiots

    2) The control is the hands of others

    I'm tending toward #2 since that's where I've been most of my life, but #1 is still a possibility.

    If God is still in the miracle business, we could use one right about now.

    Apr 12, 2013 - 11:14am

    Re: BitCoin Topic Last Thread

    Nothing gives me a sicker feeling in the pit of my stomach than BitCoin

    1. BitCoin is developed by an anonymous hacker
    2. Regardless of any assurances ALL computer code is able to be manipulated and is capable of being traced.
    3. BitCoins rise in prominence in the Main Stream Media lately without being all out attacked as terrorism as happened in the case of Bernard Von NotHaus and his Liberty Dollar has at least the tacit if not active approval of the Main Stream Media and there for their bosses.
    4. The Powers That Be have had the Wet Dream of an electronic currency that crosses all borders and is traceable for a very long time.
    5. Cyprus: Now it is common knowledge amongst those that watch and understand the ramifications of these events that Cyprus was a Planned Event. The New term “Bail In” shows up shortly after the event in the 2013 Canadian Budget which denotes longer term planning than they are telling people. Lists of people that were notified before the “Bank Holiday” have been released that shows that many were able to get their money out of the country before the event. And the bankers know as well as we know that the events that took place in Cyprus was a watershed event from which there is no return. “Make the people not trust that their deposits are safe and they will move their money into something else. While we trash the hell out of Gold and Silver not only in the Main Stream Media but trash the price at any cost in the Market. All the while letting the Main Stream Media talk about the rise in value in this new electronic currency BitCoin.

    Just My Humble Opinion


    Apr 12, 2013 - 11:14am


    Please retain that email and please send me a copy, if you don't mind. PLEASE send it to tfmetalsreport at gmail dot com.

    That he put this in print and sent it to a member of the public is a HUGE MISTAKE on his part:

    "Without saying anything I'm prohibited from saying: what we have seen ain't what some in the pm community suggest. There isn't currently one large firm with huge short positions trading to keep prices down."

    This, my friends, is an OUTRIGHT LIE and he knows it. Not couched in uncertain terms or deliberate opacity. This is A LIE. I'll let you debate as to his motives.

    Apr 12, 2013 - 11:15am


    thanks turd for all you do! taking the day to front run the fools that will be selling whatever PM's at the local pawn shops! beautiful weather for sheep fishing!

    Apr 12, 2013 - 11:15am

    Well, that has to be a short covering sometime, doesn't there?

    It looks like the miners have taken as much of a beating as they can. Who knows?


    Apr 12, 2013 - 11:15am


    I hope they get all of the selling out of their system today and every last moron that wants on the short side gets a seat on the bus because when this thing changes direction I'm going to be laughing my ass off when they get their faces ripped off. Any fucking idiot that shorts metals at these levels in light of the fundamentals is going to get what they deserve.

    Subscribe or login to read all comments.


    Donate Shop

    Get Your Subscriber Benefits

    Exclusive discount for silver purchases, and a private iTunes feed for TF Metals Report podcasts!

    Key Economic Events Week of 6/10

    6/11 8:30 ET Producer Price Index
    6/12 8:30 ET Consumer Price Index
    6/13 8:30 ET Import Price Index
    6/14 8:30 ET Retail Sales
    6/14 9:15 ET Cap Ute and Ind Prod
    6/14 10:00 ET Business Inventories

    Key Economic Events Week of 6/3

    6/4 All day Fed conference in Chicago
    6/4 10:00 ET Factory Order
    6/5 9:45 ET Markit Services PMI
    6/5 10:00 ET ISM Services PMI
    6/6 8:30 ET US Trace Deficit
    6/7 8:30 ET BLSBS
    6/7 10:00 ET Wholesale Inventories

    Key Economic Events Week of 5/28

    5/28 10:00 ET Consumer Confidence
    5/30 8:30 ET Q1 GDP 2nd guess
    5/31 8:30 ET Personal Income and Consumer Spending
    5/31 8:30 ET Core Inflation
    5/31 9:45 ET Chicago PMI