A Broader Perspective

Tue, May 14, 2013 - 11:37am

Time is short but I do have something interesting for you to consider today.

Look, there's a lot going on that will make tomorrow's gold (and silver) "market" different from yesterday's. Regardless, I still believe it's useful to look at yesterday's market in order to forecast where we might be going based upon where we have been.

Today, we're going to look at the Continuous Commodity Index. https://en.wikipedia.org/wiki/Continuous_Commodity_Index. Here's a little background info from the Wiki page:

"The 17 components of the CCI are continuously rebalanced to maintain the equal weight of 5.88%. Since CCI components are equally weighted, they therefore distribute evenly into the major sectors: Energy 17.65%, Metals 23.53%, Softs 29.41% and Agriculture 29.41%. While other commodity indices may overweight in certain sectors (e.g. Energy), the CCI provides exposure to all four commodity subgroups."

So, first, let's look at a 25-year chart. Some of you may not even have been alive at the start of this chart. Personally, I was just graduating from college and chasing my then-sweetheart to San Francisco. (That's an interesting story but we'll save it for another day.) The point is: This chart covers a lot of ground and time. Therefore, it is to be respected.

Notice that for the first half of the chart, the action is sideways. From 1988 to 2002, the index fluctuated in roughly a 50-point range. Though there was some action in individual commodities from time to time, overall the sector was a real yawner. The sideways action actually goes back even further, to the early 1980s, when interest rates were raised to choke the money supply and curb inflation. So, for roughly 20 years, commodities in general sucked.

Then what happened? The debt-induced easy growth of the 90's finally popped in 2001 and it has been off to the races for commodities ever since. Sure there have been pauses and corrections along the way but there also been periods of blowoff, parabolic rallies, too. In the end, though, the trend has remained. Here, see for yourself:

So now let's look a little closer. On the five-year, weekly chart below, you can see where we currently stand. Of course, I've tried to draw the trendline as accurately as possible but it's impossible to show exactly where it currently lays. Needless to say though, we're pretty much right on top of it. So there are three things to consider:

  1. First and foremost, is this 11 year bull market in commodities over? Did commodities go sideways for 20 years only to have a bull market end after just 10 years? Look at it another way...Have the fundamental conditions which prompted this bull market changed? Are the Fed and other central banks about to embark on a Volcker-esque tightening spree?
  2. Could commodities in general (and, by extension, gold and silver) bounce and rally right here and right now, just like they did the on the last two occasions they encountered the main trendline in late 2008 and mid 2012?
  3. Are commodities about to over-shoot again, similar to the circled area on the monthly chart above? If so, could a final drop toward 500 or even 475 be in the cards? IF that were to happen, what would be the short-term impact on the price of gold? Of silver? Would you finally capitulate/panic and sell or will you rely on your answers to the questions posed in point #1 above?

OK, gotta stop there but that should give you plenty to think about and discuss for a while. Have a great day and let's hope that CIGA BoPolny/BoPelini/BoDiddley/BoJackson is proven correct.


About the Author

tfmetalsreport [at] gmail [dot] com ()


Jun 15, 2013 - 10:22am


are ya?

Lenny Kravitz "Are You Gonna Go My Way"

I was born long ago I am the chosen I'm the one I have come to save the day And I won't leave until I'm done So that's why you've got to try You got to breath and have some fun Though I'm not paid I play this game And I won't stop until I'm done

But what I really want to know is Are you gonna go my way ? And I got to got to know

I don't know why we always cry This we must leave and get undone We must engage and rearrange And turn this planet back to one So tell me why we got to die And kill each other one by one We've got to love and rub-a-dub We've got to dance and be in love

But what I really want to know is Are you gonna go my way ? And I got to got to know

Are you gonna go my way ? 'Cause baby I got to know, yeah


No Chit, meh, a guy named Oleg, about 50ish, in Russa, Primorsky Region, out fishing salmon, off the Kamchatka coast, great guy, about 10 years ago, was explaining to me, in excruciating detail, how the Americans never landed on the moon, and he had all the answers and explanations down pat, and rattle them all, by the numbers.

Truthers and Giant Believers could seriously use this guy. LMAO

The Castaways - HD STEREO - Liar Liar


Mint shutting down, makes news, and AGE and ASE 1 oz coins, should in your cross hairs, to really put your FRN money to work, rather than any other coinage, miner, bar or futures. Just Saying

Neneh Cherry - Buffalo Stance
Jun 15, 2013 - 5:54am


you younger folks have all them hormones running wild on the make, and youth is not wasted on the young, as you all must procreate the species, but us older guys can just kick it and admired the beauty and happiness of the young ones in all their glory, and that is special also and very fun actually, just simple vicarious fun, wishing all you young one, all the fun of the marvel and the hunt, but dont to forget the flowers to make it all real special for you all. Tally Ho!! COME ON BABY!! https://www.youtube.com/watch?v=im9XuJJXylw

Jun 13, 2013 - 4:43pm

Fraud II

Using current stock, say in Comex or contingent stores say at GLD, as a basis to enter futures markets, is a manipulative trick. If you have current stores for sale, you sale them in the cash market. A contingent interest is not part of a cash market or a future market. A producer can sale forward in the futures market. Naked short sales in the futures without future production is simply a fraud.

Brenda Lee - I'm Sorry
Jun 13, 2013 - 3:03pm


How the heck can you have price discovery, in a market,

where non-producing people are selling chit they dont even have?

What am I missing??? &^$@%$^%$%#^$%^%$%#*^&^

Stated another way.

There can be no legitimate bullion price discovery, in a bullion physical market or in bullion futures markets, where non-producing participants are selling bullion they dont even have and will never actually produce, as in a bullion mine having the real physical stuff in the ground in deep storage.

Naked short bullion sales by non-miners is simply fraud.

The Temptations - Just My Imagination (Running Away with Me) HD
The O'Jays - Use Ta Be My Girl
The Manhattans - Shinning Star
The four tops - Bernadette
The Temptations - My Girl - HIGH QUALITY - With LYRICS!
Jun 13, 2013 - 5:51am


Time table is important, so all can synchronize their bat watches.

Brainwave 4/29/13 Light Bulb Turn On

Coded Draft 5/21/13 Spy Work

Re-Writing 6/7/13 Into English

Daft 6/25/13 Polishing and Editing

Edit and Final 6/30/13 Smuush the Big Cheese

Funding 6/30/13 to 7/14/13 Cash on the Barrow

Launch 7/14/13 -7/31/13 Selection of team players

Preparation 8/1/13 11/14/13 Getting down to business

Filing and Rally 11/15/13 Thanksgiving Party

Hearing and Rally 12/20/14 Christman Party

Injunction Issued 12/17/14 Christmas Present

Settlement Dismissal 2/14/15 Valentine Cards


Yeah it moves slow, but what can you say. Figure by Valentine Day, manipulation in the bullion space is over, and you guys can cry about something else. Embry is still figured to be the best Financier. A plan has been developed to get Embry, Turd, and Murphy together to fund the project, and the more is thought, the better it looks. Murphy is the veteran, Turd is the Hot Shot, Embry with wise old man. Hatter, the hit man, and can give the dog and pony show personal lecture or pod cast, any time. But figure that the polished plan document, ready in a week, will sell itself and not much smuushen should be required, maybe one conference in Courageous Canada land might be in order, just paying due respects. But, its looks good.

Patsy Cline -- I Fall To Pieces
Patsy Cline - Crazy


Jun 12, 2013 - 3:54am


because hypotheticals are expertly in these days. let imagine that a single player as a "dominant" position in the COT, and that position is naked short, purely a hypothetical of course, now what is dominance. where in stocks it something like reporting at 15%, but let imagine, just hypothetically experts saying, that dominance is assured at 50%, so having defined dominance in a mark by a naked short seller, having a 50% position. it is IMPOSSBILE not to manipulation the market using clients funds, because clients funds are not FIFO received and placed, and hence pooled to some extent, thus have some distortion on price discovery, and hence, per se manipulation. Is it impossible not to manipulate a market with clients funds? So, is it impossible? Just asking. Hypothetically of course. Oh, just because you comply with law and can own a fire arm under the permit and licensing laws, do not give you a right to shoot people dead on the street, day in and day out. Just saying.

Jun 10, 2013 - 12:58pm
Jun 10, 2013 - 9:49am
Jun 10, 2013 - 9:36am
Jun 10, 2013 - 9:31am

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Forum Discussion

by FrankMUQAQ, 1 hour 46 min ago
by HappyNow, 10 hours 25 min ago
by 11IMIX, Oct 28, 2020 - 8:49pm