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

turd [at] tfmetalsreport [dot] com ()


Aug 21, 2013 - 6:41am

(No subject)

God Bless America!!!
You're a Grand Old Flag
Aug 23, 2013 - 8:40pm
Aug 25, 2013 - 5:43am
Aug 25, 2013 - 5:44am
Aug 25, 2013 - 5:46am
Aug 25, 2013 - 6:30am
Aug 25, 2013 - 8:02am


Hail to the Chief
Aug 27, 2013 - 9:28am


Sir Douglas Quintet - Mendocino
Sir Douglas Quintet - She's About A Mover (1965)
Video unavailable
Sep 4, 2013 - 5:33am
Sep 4, 2013 - 11:25am
Oct 18, 2013 - 2:06pm

Rally Monkey

Rally Monkey
Oct 19, 2013 - 10:15pm

It so easy

Its so easy Submitted by Mad5Hatter on October 18, 2013 - 4:38am. Hat Tip! 1 Even a caveman can do it, or any mad hatter about town. Geico Caveman Commercial, The Original Geico Cavemen Commercials First Five Combo Proving price manipulation is relatively easy to do. Interrogatory No. 1: List all the transactions, by date, by time, by sells volume, by exchange, by inhouse funds or by client funds, by Gold, by Silver, of any short position sold, for the top 20 periods by sells volume, in dollar amounts, where each period being 8 hours in length, having the top accumulative short sells volumes, since January 1 2009. Interrogatory No. 2: List all clients by transaction of any and all clients who have any interest in any of the transactions listed in Interrogatory No. 1. The basic method is to dump paper derivative contacts, COMEX nake short short contracts, tripping all bid stack stop loss orders, to make the price collapse, as NO ONE with an honest intention to maximize sells prices would do such a thing, but would rather spread out the sells orders over time so as to maximize profit. Surely the bullion banks, JPM GS HSBC et al, do not dump for mere honest market profits, but rather to manipulate the price lower, to discourage bullion ownership, to make the US paper fiat dollar look better, for only bullion, gold and silver, are the true measure of any fiat paper money. Of course, they do this at the direction of the FED, ESF, BIS and other controlling central banks, to maintain the illusion of sound fiat paper money. But before the bullion bank can claim a defense of government immunity by acting as agents for central banks, and hence government, they must first admit that they have regularly manipulated prices, which would otherwise be a crime of market rigging and racketeering. Selling a year's production in five minutes is Mala en se criminality, regularly conducted in ALL MARKETS, through the central banks, and in the of the US, through the FED and ESF. It is simply the way it is, and done so with brazen impunity. The bullion banks are simply criminal racketeers, fleecing the investing public. But it is really much worse than that, because they all know that the fiat dollar will collapse in time through the necessity of continue QE, and hence, suppress prices so that China, Russia, and India in particular can pick up the bullion metal on the cheap, and in so doing, KNOWINGLY aid in the transfer of bullion from WEST to EAST, which is TREASON, thereby depleting the stocks of western bullion reserves, a necessary back stop reserve of real money when the fiat paper money fails, and thus, are acting in conspiracy with eastern powers and the FED bank to destroy the US ability to prevent total anarchy when the US fiat paper dollar collapses. Robin Trower; Bridge of Sighs, 1974

Oct 19, 2013 - 10:21pm

Economic Crisis

The Biggest Scam In The History Of Mankind - Hidden Secrets of Money Episode 4

01 - The Economic Crisis (The Fall of America & the Western World) https://www.youtube.com/watch?v=nB8GmcRV_yg 02 - Financial Armageddon https://www.youtube.com/watch?v=0sV4ppmz0wA 03 - The Police State https://www.youtube.com/watch?v=HXHnE3Gk-l8 04 - The End of the World https://www.youtube.com/watch?v=JvUGGIzSxXo 05 - The Power Elite Pt.1, with Alex Jones https://www.youtube.com/watch?v=wuO2dqqPC-E 06 - The Power Elite Pt.2, with David Icke https://www.youtube.com/watch?v=Cdx38ub4vUA 07 - Our American Nightmare https://www.youtube.com/watch?v=jJkQ9XLmfJ4 08 - America's Collapse https://www.youtube.com/watch?v=GHSo-OUePVI 09 - Survival Guide https://www.youtube.com/watch?v=CLYFB1c0m40

Nov 10, 2013 - 12:54pm


Nek - La Vita é (Eiffel 65 Remix)
Dec 29, 2013 - 8:17am

12/31/2014 Hatter Official Call

Jan-March, run to 2100, retest 1900; March-June, Run to 2400, retest 2100 Silver 70$); Summer 2100 +/- 150, FED fund or 10 year, 4% with many vacationing and slow, silver retests 50$; August-Sept-MidOct Run to 3000, Silver 140$; MidOct-Nov Dec, retest 2400, OUT AT 2500/100 25:1 GSR. But then, izzzzzz a silver bull ...... :o

Thats right 100% in Au and 400% for HI HO SILVER!!!!! by end 2014.

For the Record ....

Current 1214 Au and 20.07 Ag, with expected 12/30 raid to 1190 and 19.90.

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