It's Good To Be Wrong

102
Thu, Jan 23, 2014 - 10:50am

Man, they had us set up. There was hardly any doubt that a raid was coming today. But then some unexpected news hit and...whaddayaknow? A rally! A big rally! It's good to be wrong. It's also very encouraging, too, for reasons I'll discuss.

I can't stress enough how surprising, helpful and positive this is. There's a reason I'm Turd and I have a website. Primarily it's because I can usually read The Cartel signals and accurately anticipate their next move. As of late yesterday, everything was set up for a Cartel raid and, like clockwork, it began on The Globex and continued into the early Asian trade. However, instead of accelerating in London, the trend reversed, no doubt helped by the stories out of India regarding a reduction/removal of the silly tariffs on gold: https://www.zerohedge.com/news/2014-01-23/gold-surges-speculation-india-may-ease-import-restrictions

That's all well and good. Cartel plans were spoiled and a mini-squeeze developed. By itself, this isn't unusual and really not much of note. What is unusual and worth noting is the follow on buying. This is, potentially, quite significant.

WHY? Again, my major thesis for 2014 is that the structure of the global gold market is rapidly changing. One of the components of this is the heretofore unheard of JPM NET LONG position in Comex gold futures. Add to that the latest non-U.S. bank net position which was only short about 6,000 contracts. I cannot stress strongly enough the potential impacts of this change. Are we seeing one of the effects today?

Classic Turd would have been 100% correct in calling today's downturn. The New Turd is seeing proof today that his "2014 Thesis" is playing out in real time. Instead of a raid, we get a rally. Instead of a cap, we get a continued squeeze that has extended through critical resistance near $1260 as I type. Instead of Spec longs getting fleeced, we have Spec shorts getting slaughtered. IF I'm correct about this...and that's a very big and important IF...then this is only the beginning of a significant sea change in the metals "markets". Stay tuned...

Here's your latest gold chart. Note the lines of significant resistance that have been breached this morning. Also note the very impressive, bullish engulfing candle that is currently being painted on this chart. It is very hard to imagine this being allowed back in the "old days". In this new paradigm, might this become the norm?

And I want you to look very closely at this silver chart. Yes, silver is forming a very solid base for the resumption of the bull market. However, look at the surges in price that I've circled and notice that they are accompanied by high volume. And this volume is sticking as total Comex silver open interest has risen by nearly 6% since the 2nd of December. To me, this shows significant, long-term, strong-hand buying interest coming into the silver "market". I am very encouraged by all of this and even more confident that an UPside breakout and bottom confirmation is a certainty. It's simply a matter of time.

Just one other item today because I want to get this posted ASAP...Look again at the surging price of NatGas and the bounceback in crude. For a consumer already stretched thin by a double in price of such staples as gasoline, milk and beef, a surge in NatGas to near 5-year highs is a most unwelcome development.

Though higher prices for NatGas are clearly a trend that began in 2012, this latest jump is almost certainly related to the continuing snap of bitter cold weather in the eastern U.S. Therefore, though I'm not one to get excited about jumping in front of runaway trains, there is likely an opportunity for a very risk-oriented gambler to short NatGas if it touches $5.00. There are several short NatGas ETFs that trade on the NYSE if you are feeling so inclined. I'd look to ring the register on any pullback to near the old $4.40 resistance level which would now be support.

As I close, I see that we did, in fact, see some capping after the post-1260 short squeeze. Silver is all the way back to the old bogey of $20.20, too. Regardless, today's action is still very surprising and a most welcome development. Be happy and confident but stay patient. The battleship is turning and 2014 is going to be a very interesting year.

TF

About the Author

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turd [at] tfmetalsreport [dot] com ()

  102 Comments

tyberious
Jan 23, 2014 - 10:51am

Furst

Furst

Mickey
Jan 23, 2014 - 10:51am

batting average

thats what counts

tyberious
Jan 23, 2014 - 10:52am

What an Inflation-Adjusted

What an Inflation-Adjusted All Time High in Gold Would Look Like

Submitted by Phoenix Capital Research on 01/22/2014 12:25 -0500


inShare2

Gold has been in a bear market for some two years now. As a result of this, many investors believe that the precious metal is no longer a viable investment.

No investment ever goes straight up or straight down. During the last bull market in gold, the precious metal rose 2,329% from a low of $35 in 1970 to a high of $850 in 1980. However, during that time, there was a period of 18 months in which gold fell nearly 50% (see the chart below)

As you can see, from mid-1971 to December 1974, gold rose 471%. It then fell 50%, from December ’74 to August ’76. After that, it began its next leg up, exploding 750% higher from August ’76 to January 1980.

With that in mind, I believe the next leg up in Gold could very well be the BIG one. Indeed, based on the US Federal Reserve’s money printing alone Gold should be at $1800 per ounce today.

Moreover, at $1,800, Gold is Still Nowhere Near Its All-Time High

Now, a lot of commentators have noted that gold is already trading above its 1980 high ($850 an ounce). What they fail to note is that thanks to inflation, $1 in the ‘70s is worth a LOT MORE than a $1 today.

$1 in…

Is Worth Today

1970

$5.49

1980

$2.58

For gold to hit a new all time high adjusted for inflation, it would have to clear at least $2,193 per ounce. If you go by 1970 dollars (when gold started its last bull market) it’d have to hit $4,666 per ounce.

Bottomline: gold is nowhere near a peak adjusted for inflation. And when the next leg up begins, we could see a tremendous move.

https://www.zerohedge.com/contributed/2014-01-22/what-inflation-adjusted...

Jan 23, 2014 - 10:53am

And what a goon this fool is

I'm sure he'll be all excited and in full SPIN mode, too, when the "unemployment rate" falls to 6.0% in two weeks.

https://www.zerohedge.com/news/2014-01-23/14-million-jobless-officially-...

Mickey
Jan 23, 2014 - 10:56am

Japan and USD

had a lot to do with this.

and the public still has not figured out that we do not have 1500 tonnes of german gold or probably the other 5200 tonnes held for others, or maybe even our 8100 tonnes.

then all the unallocated gold promised around the world. and perhaps some "allocated" gold.

What is Germany's recourse? Can the Fed tell them to go pound sand? No wonder why Germany is aligning with Russia and China.

We are going to be screwed in so many ways we cannot count.

Jan 23, 2014 - 11:00am

The site is very busy today

Lots of traffic, as might be expected on such a nice rally.

A question for all Vaulters:

Would anyone object to me making Monday's "miner" post a public thread? I'd like to give newcomers and non-subcribers some meat for stopping by.

Just let me know in the comments below.

s1lverbullet
Jan 23, 2014 - 11:01am

And here comes the raid!

Haha, so predictable, someone really doesn't want a gold breakout right now.

Jan 23, 2014 - 11:02am
s1lverbullet
Jan 23, 2014 - 11:04am

And with a print of $1267.00

And with a print of $1267.00 as the high in Feb14 gold, it was almost EXACTLY a 2.0% cap.

Btw, there is no technical reason to stop there as the next MA is the 100-day and it's all the way up near $1285.

Heart's Yours
Jan 23, 2014 - 11:04am

post it Turd

It has been a few days already.....make it public and try to reel in a few more subscribers. Thanks for all you do.

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