Worn Out

92
Tue, Apr 22, 2014 - 11:13am

If I'm tired and frustrated, I can only imagine how you must feel.

There are certainly days when the accumulated burden of the last three years shows itself. I know how the metals have been manipulated and I know why, as well. This helps me to keep my spirits up but there are some days when I feel a bit overrun. Today is such a day. (Perhaps this is a buying signal / trend change? I recall seeing this speculated in the past.)

Today is a Terrible Tuesday. Why? For the same reasons Tuesdays are always Happy or Terrible. The Banks have been big buyers and coverers this past week on the price weakness that has continued since last Tuesday. When The Banks have been buyers, they almost always attempt to cover some of their tracks by selling on Tuesdays. The result is "Terrible Tuesday". Conversely, when the banks are on their heels and selling into rallies all week, they often like to buy some shorts back on Tuesday. We call these days "Happy Tuesday".

As has been the case, the key levels to watch are the lows of last week and gold's 100-day moving average. For the June gold, this is all near $1279. In silver, holding and bouncing from $19.20 remains important.

There continue to be plenty of bearish scenarios being bandied about on the internet and in the media. Though I fundamentally disagree with all of them, I thought I should give you some long-term charts so that you can see where these folks are coming from and then decide for yourself.

Gold is still over 0 off of its Double Bottom lows of last year. Note, too, that the weekly RSI is still above the long-term down trendline that it broke earlier this year. Regardless, there seem to be a lot of folks who are convinced that 50 is the next stop.

Silver, on the other hand, has broken back below the long-term RSI line and it clearly continues to face steep EE resistance to keep it below the red price trendline. If .20 is broken and fails, a retest of the June lows certainly looms as a possibility. Many bears say would be next but, with the cost of production estimated to be near , I'm not sure how that would be possible or sustainable. Oh well, fwiw...

And here's a one year chart of the HUI. Remember, I only got interested in these damned things when the HUI broke UP and through 210 back in January. If it fails now and falls back through 210 (which I don't think it will but wtfk?), then you've got to severely reduce or eliminate your exposure again. Watch closely in the days ahead. The 100-day MA near 218 will be your key.

And speaking of silver, our pal SRSrocco has an excellent new report on silver demand, particularly in China. Give this a good read and then further ponder the " silver" question: https://srsroccoreport.com/silver-continues-to-drain-from-the-shanghai-f...

More later today.

TF

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  92 Comments

unwired
Apr 22, 2014 - 11:42am

Yep SOS

Metals in lock down mode and treading sideways. Then we get to the first PM fix since last Friday... and down we go.

The relentless manipulative resetting of price lower continues.... its typically $10 increments.

ZH sees the same drill... as well as "it's Tuesday.... stocks go up"

https://www.zerohedge.com/news/2014-04-22/gold-tumbles-2-month-lows-beca...

https://www.zerohedge.com/news/2014-04-22/remember-its-tuesday

Strongsidejedi
Apr 22, 2014 - 11:42am

@TF - on Belgium

@TF

Any thoughts on the increasing position of Belgium as a holder of US Dollars/Treasuries?

https://www.ft.com/cms/s/0/a1de1546-c489-11e3-b2fb-00144feabdc0.html#axzz2zd6baNaI

Perhaps this was already discussed on the board, but the story is a big deal.

Another sign of international financial warfare

quoting the FT story:

According to US Treasury data released on Tuesday, Belgium’s holdings of US debt rose by a further $30.9bn during February, to reach $341.2bn.

Since last August, Treasury debt attributed to Belgium by official US data has surged from $160bn – and this rapid growth means that the country, with a gross domestic product of $484bn, presently ranks after China and Japan as the third largest foreign holder of US Treasury debt."

The story goes on to suggest that the Russians may have moved their Sovereign debt holdings. The story then offers additional explanation:

A further explanation for the rise of Belgium as a big Treasury holder is financial reform that requires the greater use of top-rated government debt as collateral for derivatives trades.

Euroclear, which holds more than €22tn in assets under custody, confirmed that the volume of US Treasuries it holds had “gone up dramatically” in recent months.

Traders say Euroclear is renowned for its sophisticated collateral management system, which helps global investors move bonds to various clearing houses around the world.

US Treasury paper is the largest and most liquid of “safe” collateral used to backstop the financial system. Indeed, since the financial crisis, the amount of outstanding US Treasury debt has nearly tripled to $12tn, creating a vast pool of collateral for the global financial system.

Does Euroclear relate to the LBMA and London fix via the derivatives on gold? Is the demand for UST's in Europe increasing due to the need to collateralize the derivatives?

Is this a sign of what Jim Sinclair was talking about in his GOTS speeches?

Swineflogger
Apr 22, 2014 - 11:45am

Thought for the Day

Politicians are people who, when they see light at the end of the tunnel, go out and buy some more tunnel.

~John Quinton

johnchew
Apr 22, 2014 - 11:47am

Please We NEED MORE Manipulation

Is there any way to get the "manipulators" to crush" gold under $1,200? I wanna load up. Gold goes to $1,430 then back to $1,200 and then up to $1,390 back on down to $1,000? Big deal--a trading range.

Imagine if manipulators forced the price of beer and steak ever lower to weed out weak longs. I bet anyone on this blog $1 million that you would NOT complain.

I don't understand why TF is upset by declining prices. You gain more gold per dollar exchanged. Help me I'm a newbie here.

freemarkettrader
Apr 22, 2014 - 11:47am
Strongsidejedi
Apr 22, 2014 - 11:49am

Hi, SSJ

No doubt and without question this is EU/ECB buying to help The Fed create and maintain the illusion of "taper".

wildstylechef
Apr 22, 2014 - 11:49am

Sixth will do

I think we are headed to 1277 as they try to break the previous low

And boom they just achieved it. Same old pattern as it pre warns with a flush below the previous barrier that has been support , here it was 1280 that we achieved at 10:47 , as soon as I saw that I knew we were going lower. Good thing about this is it gives you a warning shot that at plunge is coming and they just bust the March 31st low . Bastards and the really crappy thing is Morgan pre-forcasts their manipulations so they can say "see I told you so" the question is do they achieve the take down to 1150, if they do then this will create such as demand on gold that it will force the default of the physical even with the flush of gold out of the GLD

johnchew
Apr 22, 2014 - 11:49am

It just gets old, John

I'm fighting a long-term battle here against The Forces of Evil and Darkness.

johnchewAIJ
Apr 22, 2014 - 11:51am

Thanks~!

Excellent advice!

jezfry
Apr 22, 2014 - 11:55am

Limited longs

If JPM just dumped more contracts to do this then the situation is heating up. They only have limited firepower and need follow through spec selling for this to work. Looks like the opposite so far...

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