Just Some Charts

219
Mon, Apr 22, 2013 - 1:49pm

Because it's late and this is about all I can handle for today.

We had a little bit of a rally today but did you notice that gold was stopped in its tracks when:

  1. The Comex opened for trading and
  2. It had reached the all-important "2% cap". In fact, there was a clear movement afoot to close gold back under the 1% cap and they nearly made it.

So, now, here we are. Yes, it's always nice (and rare) to begin the week on an UP note. But don't be fooled...nothing much has been accomplished. I had expected/hoped that the drop out of the 19-month ranges would be nothing but a brief, stop-running exercise. Instead, the thing took on a life of its own last Monday and now we learn via the CoT that The Cartels didn't even cover. The LargeSpecs did. All of this infers that further weakness and volatility may be coming. Let's hope not but until prices get back into the 19-month ranges (above $1525-1550 and $26), we must remain vigilant.

And here is your homework assignment / thought experiment for the day. I want you to print off these three charts. Place the gold chart on top of the copper chart and hold it up to the light. Then, do the same with silver and copper. Having done that, let me ask you this:

Why are these charts nearly identical? Other than being elements on the periodic table, what do these metals have in common. If your list of commonalities is short, why do they trade as they do? And because they trade nearly in tandem, what does this say about the current method of price discovery?

OK, that's all. Gotta go. Have a great day!

TF

About the Author

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turd [at] tfmetalsreport [dot] com ()

  219 Comments

Texas Sandman
Apr 22, 2013 - 4:54pm

@Mud

It makes sense to start trading gold for silver at a GS ratio of 60.

Lately, I haven't been doing that, but I have switched my purchases to silver alone near and above 60.

The GSR fluctuates, but if it's any consolation it has averaged 20 over time, in roman times it was at 16, silver is only 10 times as plentiful in the earth's crust as gold. Unlike gold, silver is consumed, and we're already mining less year by year.

Silver will have its time to shine. Just don't compound your mistake by trading back into gold now!

The Watchman
Apr 22, 2013 - 4:57pm
SilverSurfers
Apr 22, 2013 - 5:33pm

ok

back on front page,

1st comment, alex must like asian chicks, all 12000 of them, probably out of film.

24 Ag hanging tuff, no moon shot, so when do we go ballistic, trud has dyno sticks ready, no doubt. Oh, back to the slow grin, up trend, that works. Are screaming eagles still flying? Lease Rates going off the charts? So how did boston, noko work out, anyway, we still alive and chill yet? Has DHS up-gunned to abraim tanks, yet. Any chinese carriers in the south china sea, yet? Any new appointments, direct from top, after atty gen? Junk Premiums still Parabolic?

What biggie was missed, if any?

oh Meh, back to the slow grin, boooorrrringgggg, a suggestion only, Alex be appointed, Team Photographer, Ill make a by-line, precious as always.

ancientmoney
Apr 22, 2013 - 5:38pm

ASEs at $4 over spot . . .

At Colorado Gold. Good guys--have bought there many times.

They also charge from 1/2% to 1.5% on top of final amount, depending on size of your buy. Still pretty good today. 30 day wait on delivery.

Must buy a monstor box (500) of ASEs at a time. Other silver available in smaller quants.

Zoltan
Apr 22, 2013 - 5:46pm

Knew it Wouldn't Last

Silver Lease Rates
Apr 22 2013 Change
1M -0.5500% -0.5500
2M -0.5500% -0.5500
3M -0.2749% -0.2749
6M -0.1171% -0.1171
1Y 0.1655% +0.1655

Negative Silver Lease Rates. The new normal.

Z

I Run Bartertown
Apr 22, 2013 - 5:55pm

Thanks Zoltan

Thanks for posting the lease rate updates. I might be oversimplifying things, but that seems pretty clear in its implications. Especially when the data seems to 'disappear' periodically, if I'm remembering your posts right.

Zoltan
Apr 22, 2013 - 6:06pm

ND Open

Big first minute tick in Silver with 6k NDU. Kept any price rise in the bottle.

NP on the Lease Rate stuff IRB. Just like to document it here cause it goes down the memory hole at Kitco pretty quick.

Z

slavador
Apr 22, 2013 - 6:13pm

gld seems curious today

Today gold was up $20 but gld holdings decreased by another 20 tons to 1104.7.

Is this good news, bad news or not news?

Flying Wombat
Apr 22, 2013 - 6:46pm

Regarding that high com silver short...

One thing to keep in mind, Turd: I would expect the average JPM silver short book to be either in the money right now, or darn close. It's been more than two years since we saw $22 and change, the significance of which is all the important if we assume that part of the 2011 spike to $50-ish came with JPM being rumored to have let some of their price capping effort relax for a bit. But even with out assuming the latter, the primary assumption regarding $22 remains.

THEREFORE: JPM's challenge for the time being may very well be covering some of their shorts without spiking price. If their net average exposure is in the money, which I assume to be the case given that we're in the $23 and change level, they have the luxury of taking their time leaving or even adding some shorts and, as a result, confusing the heck out of everyone looking to the COT for answers.

As you also know, we have no friggin idea what they might be doing in the OTC market. I wouldn't be surprised at if they were further insulating their average net COMEX silver position with incremental longs added to silver through OTC-placed trades, leaving the COMEX COT reported as high just to freak out you and all other COT watchers.

Sadly, we just will not know what's going on because the OTC is as dark as it gets.

Best,

Eric Dubin

aka Flying Wombat

USSilverBug
Apr 22, 2013 - 6:57pm

Did someone take down Jim Sinclaire's site?

The cache for www.jsmineset.com has disappeared. Seems to me someone doesn't like what Jim is posting...?

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