This Is Getting Fun Again

50
Tue, Jan 20, 2015 - 11:52am

Gold up. Silver up. Miners up. Bonds up. Stocks down (sorry paperbugs). As we begin what will be a very interesting and volatile week, it's finally getting fun to look at the charts again.

Just a quick snapshot as I begin typing...

Gold is UP $14 at $1291.

Silver is UP 13¢ at $17.88.

The HUI index is UP seven points at 208.

The S&P is down seven points. The Dow is down 93.

WTI Crude is down $2 at $47.13.

And bonds are rallying hard again with the 10-year note falling to 1.77% and the 30-year Long Bond making new all-time lows at just 2.37%...an incredibly FLAT spread of just 60 basis points.

This is all very exciting so lets start with the good news.

I mentioned last week that the area around $1260 was a critical and important resistance point. Not only was it the trendline connecting the two highs of March and July 2014, it was also about $60 above the long-term, primary trendline from 2013 that we've been following so closely for so long. Back in March and June, The Cartel had attacked at these levels...failure to do so now would/could/might indicate a failure and final breakdown of their current suppression efforts.

We all know about negative GOFO, the physical floor at $1150 and the closing triangle. As I mentioned in that interview last week with Rory, could the Swiss de-pegging be the "first cracks in the central banking facade" and "might this every man for himself" idea take hold and shatter the cooperation to suppress gold, too? Whether or not The Bullion Bank Cartel put up a fight at $1260 could very well be your first real indicator of systemic change. Well, well, well...look what has happened since.

Not only has gold surged through $1260, it has also surged through the always-significant $1280 and now is pressing toward $1300! Silver has also surged to new "recovery" highs and has already printed a few trades above $18! And the week is just beginning!!

And the weekly charts are really exciting. IF/WHEN this rally continues and presses through the lows set after the massive, contrived selloff of April 2013 (20 in gold, in silver), it will become abundantly clear to anyone willing to objectively look that a massive floor and reversal has been set.

And the HUI looks good, too. It is back above 202 at 207 and a couple of close here might really begin to light a fire under things.

OK, all of that said (typed), here's the bad news (sort of)...

You KNOW that, in the short term, they're going to come after us. Even though prices have sprung from incredibly low and over-sold levels, the rallies have been steep and sharp and The Banks have had to issue paper like crazy in their attempts to manage the ascent. In the last CoT period (1/7-1/13), The Banks issued 14,000 new naked shorts for a total NET change of 15,000 contracts. And, again, this was through last Tuesday with price at 34 and open interest at 402,108. Well, Hells Bells! As of right now with another CoT survey looming this afternoon, price is higher and open interest has grown by at least 22,000 contracts. Those new 22,000 contracts are almost entirely Spec buying and Commercial shorting so the CoT, as of this instant, is very likely the most negative and "bearish" that it has been in over a year.

Additionally, any new Cartel shorts applied to raid price back down after the close today have a full week to get covered back up as the next CoT survey won't be taken until next Tuesday.

And here's the deal....ECBQE is no longer a Turdville secret. Yes, we connected the dots pretty early with the Swiss NIRP announcement back in December but now EVERYONE is expecting some form of ECBQE announcement on Thursday. Oh sure, there will almost certainly be one but can't can't you see what's coming next?

  • "Yes the ECB announced their own QE but it wasn't as much as anticipated..."
  • "The ECB disappointed the markets today by only announcing a QE plan of $XXXB euro..."
  • "Draghi said this was only temporary and the plan will be ended even before it begins <sarc>"...

Or, heaven forbid, we're all wrong and the ECB does nothing. In any event, attempts will almost certainly be made to smash and raid price back down....away from $1320, below $1300 and back under $1280...in a "buy the rumor, sell the news" type of mindset. Don't you just know that this is what's going to happen? Just don't be caught flat-footed.

Now back to the good news...

This is all short-term stuff and it means nothing in The Big Picture. We still have:

  • Euro and central banking defections
  • Extremely tight physical supply
  • Ongoing repatriation movement spreading all over Europe
  • Incredible, surging Chinese demand in the new year
  • Hot War resuming in Ukraine
  • Crumbling commodity and equity markets
  • Worldwide free-falling interest rates
  • ZIRP and NIRP

So let The Forces of Darkness writhe and struggle in their death throes. They are fighting a losing battle and their ultimate destruction is assured. Instead you and I will patiently continue to stack and prepare for the eventuality of a new global financial paradigm. As I've stated repeatedly, your physical metal may be down in "price" but it has never been more valuable. This statement has never been more true and appropriate than it is at present.

Go now and prepare for a very interesting week ahead.

TF

About the Author

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turd [at] tfmetalsreport [dot] com ()

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Jan 20, 2015 - 3:18pm

Ukraine Update 1/20

As I mentioned on Sunday, very intense fighting has been happening all along the front lines.

- Novorussian forces cleared the Donetsk airport and successfully captured the New Terminal. Ukraine had some "crack" troops holding out in this building for several weeks now. These troops had achieved an almost mythical status among Ukrainians as Kiev played up their exploits. Known as "the cyborgs" their fame was likened to the defenders of Stalingrad. Thus, when the Novorussians finally cleared these guys out, Ukraine immediately launched 2-3 counter-attacks on the airport (Saturday/Sunday). The goal was to at least get Ukrainian guys back into the new terminal to maintain the appearance that the "cyborgs" still held.

- After intense fighting, Novorussians successfully repelled all the Ukrainian counter-attacks on the airport. The last culminating in an end-run into the northern outskirts of Donetsk where a tank battle ended when the Novorussians collapsed a bridge onto 2 Ukrainian tanks.

- Sunday/Monday saw fiercely intense shelling of Gorlovka. Several civilians were killed there, as well as in Donetsk.

- Late Sunday/yesterday/today, Novorussia has been on the (limited) offensive. They have pushed west from the Donetsk airport and have secured the village of Peski. They have also pushed northeast of the aiport into Avdyeevka. These two villages are important in that Ukraine was using these as the primary locations to fire artillery onto Donetsk.

- Novorussia is also pushing on Mariupol and has secured a village on the eastern outskirts. However, no major attack seems imminent on Mariupol.

- I could go all along the front lines and list detailed engagement sites, but suffice it to say, Novorussian forces are advancing everywhere. ***These advances are only tactical in nature--they do not show any type of "break-out" or large-scale, coordinated offensive. With that being said, Ukraine has zero, zilch, nada, nol military successes in this latest escalation.

- Russian FM, Sergei Lavrov is due in Berlin tomorrow to resume talks on the Normandy format. It will be interesting to see if Russia is finally fed up with the appeasement/time-buying strategy. Russia has been arming the Novorussian defenders. However, they actively close the supply spigot so that Novorussia is only an effective DEFENSIVE force. Novorussian militia do not have the means to push to Kiev and Russia won't give them those means. Remember that in the summer, Novorussian forces were moving virtually unopposed onto Mariupol and Zaparozhia only to stop and return to the Minsk accord boundaries. There was no military reason for this. Russia simply said, "back up" or no more guns/ammo.

- Thus, while Russia may be moving troops around the Ukrainian border, it doesn't make any sense to overtly invade now when your proxy defenders are doing so well.

-----------------

These things are some rumors that I've seen and wanted to share with the major caveat that they are RUMORS. They merely bare remembering and watching in the next 30-days or so.

- I've seen a lot about a possible 2nd Maidan/coup against the Poroshenko government. Talks about the oligarch Kolomoisky/Right Sector/Yatsentyuk teaming up to oust Poroshenko and declare war on Russia. Kolomoisky has his own private army that is reportedly, very well manned with European mercs.

- RUMOR that Right Sector may attempt some provocative actions against Russia in the Kherson region bordering Crimea.

- RUMOR that some premiers in Kiev are evacuating their families ahead of the possible coup

- FACT...Ukrainians are extremely upset about the airport/cyborgs falling and that these guys weren't given the assistance they needed. The fragile propaganda "house of cards" could be falling down on Poroshenko who would be the scapegoat.

Jan 20, 2015 - 2:49pm

More Hot War

Definitely something to keep an eye on in the days ahead:

https://www.dailymail.co.uk/news/article-2918478/Iran-Hezbollah-planning...

Additional background from debka: https://www.debka.com/article/24352/Israel’s-climb-down-over-Golan-air-strike-We-didn’t-know-Hizballah’s-convoy-carried-high-Iranian-officers

CPE
Jan 20, 2015 - 2:44pm

@Mr. Fix

The article was written by Saxo BANK.

When I read/listen to anything emitted from a Bank or ones working for a Bank then I know that lies are part of the message. So your point is well taken, and I agree with it wholeheartedly.

However, truth can still be spoken by fools, hence my cherry picking the quote that I thought most important as it sheds light on the FRN/InsertToiletPaperCurrencyHere pairs that Turdville has been following.

Though I agree with Turd's concern with this ongoing spike, I do believe the Central Bank thieves will conspire to bring the dollar back down if possible. Perhaps it no longer is. If the Europeans QE this week then maybe it isn't. If they don't or do something undersized, which I consider a distinct possibility then it's check to Grandma Fellen to begin QE4. And that's how it all blows up.

Jan 20, 2015 - 2:41pm
Ruislip Rangerrealitybiter
Jan 20, 2015 - 2:38pm

Oil was cut in more than half

Oil was cut in more than half in dollars over 6 months, could you say the price of oil was “re set”? How about copper? How about other foreign currencies? Could the huge moves in so many assets qualify as being “re set”?

I thought this was a very important point , good article.

Mr. Fix
Jan 20, 2015 - 2:36pm

On that zero hedge article:

@ CPE.

I read that article a little while ago, and it seemed to be implying that the central bankers are innocent victims of their political puppet masters.

Are they seriously trying to convince us of that?

The central banks are solely responsible for the economic collapse of planet Earth.

To pretending that the politicians have masterminded this is farcical.

I would take that article with a monster grain of salt.

https://www.zerohedge.com/news/2015-01-20/saxo-bank-warns-endgame-central-banks

Edit:

Procog:

​ Thank you, I'll be around.

Key Economic Events Week of 5/25

5/26 8:30 ET Chicago Fed
5/26 10:00 ET Consumer Confidence
5/27 2:00 ET Fed Beige Book
5/28 8:30 ET Q2 GDP 2nd guess
5/28 8:30 ET Durable Goods
5/29 8:30 ET Pers Inc and Cons Spend
5/29 8:30 ET Core Inflation
5/29 9:45 ET Chicago PMI

procog
Jan 20, 2015 - 2:25pm

@Mr. Fix

Very sad to hear of your injury. I wish you speedy healing.

I have made the dark and unplugged a friend. I do TM regularly. It settles my ever racing mind (that never seems to get to the finish line).

As you well know, the trick is to turn one's disadvantage into an advantage.

Looking forward to your ever- pertinent posts.

CPE
Jan 20, 2015 - 2:18pm

The US dollar is putting

The US dollar is putting pressure not only on US itself but also the world. A journalist asked me last week: Who benefits from a stronger US dollar? I still owe him an answer because very few benefit. In fact the world has two growth engines: The US and emerging markets. Both are pretty much US dollar economies. Debt (US dollar funding) in EM has exploded to an extent that many including the World Bank now call a for risk of “Perfect Storm in EM”. Both US and EM became credit junkies over the QE-to-infinity era in the US. The law of unintended consequences. - Steen Jakobsen, CIO & Chief Economist, Saxo Bank

An excerpt from here: https://www.zerohedge.com/news/2015-01-20/saxo-bank-warns-endgame-centra...

tyberious
Jan 20, 2015 - 2:07pm

Ukraine

has shown themselves to murderers and displaceable liars! Words uttered from their mouths are to be rejected the moment their lips move!

SteveW
Jan 20, 2015 - 2:05pm

Goldman Sachs profit down but ...

“Looking ahead, we see evidence of a continued pick up in momentum for the global economy that will improve the opportunity set for 2015,” Chief Executive Lloyd Blankfein said in a statement.

https://fortune.com/2015/01/16/goldman-sachs-profit-hit-by-lower-trading...

Since the giant squid makes its money on both positive and negative momentum this meaningless statement makes me wonder whether the opportunity set resides in being long or short.

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Key Economic Events Week of 5/25

5/26 8:30 ET Chicago Fed
5/26 10:00 ET Consumer Confidence
5/27 2:00 ET Fed Beige Book
5/28 8:30 ET Q2 GDP 2nd guess
5/28 8:30 ET Durable Goods
5/29 8:30 ET Pers Inc and Cons Spend
5/29 8:30 ET Core Inflation
5/29 9:45 ET Chicago PMI

Key Economic Events Week of 5/18

5/18 2:00 ET Goon Bostic speech
5/19 8:30 ET Housing starts
5/19 10:00 ET CGP and Mnuchin US Senate
5/20 10:00 ET Goon Bullard speech
5/20 2:00 ET April FOMC minutes
5/21 8:30 ET Philly Fed
5/21 9:45 ET Markit flash PMIs for May
5/21 10:00 ET Goon Williams speech
5/21 1:00 ET Goon Chlamydia speech
5/21 2:30 ET Chief Goon Powell speech

Key Economic Events Week of 5/11

5/11 12:00 ET Goon Bostic speech
5/11 12:30 ET Goon Evans speech
5/12 8:30 ET CPI
5/12 9:00 ET Goon Kashnkari speech
5/12 10:00 ET Goon Quarles speech
5/12 10:00 ET Goon Harker speech
5/12 5:00 ET Goon Mester speech
5/13 8:30 ET PPI
5/13 9:00 ET Chief Goon Powell speech
5/14 8:30 ET Initial jobless claims and import prices
5/14 1:00 ET Another Goon Kashnkari speech
5/14 6:00 ET Goon Kaplan speech
5/15 8:30 ET Retail Sales and Empire State index
5/15 9:15 ET Cap Ute and Ind Prod
5/15 10:00 ET Business Inventories

Key Economic Events Week of 5/4

5/4 10:00 ET Factory Orders
5/5 8:30 ET US Trade Deficit
5/5 9:45 ET Markit Service PMI
5/5 10:00 ET ISM Sevrice PMI
5/6 8:15 ET ADP jobs report
5/7 8:30 ET Productivity
5/8 8:30 ET BLSBS
5/8 10:00 ET Wholesale Inventories

Key Economic Events Week of 4/27

4/28 8:30 ET Advance trade in goods
4/28 9:00 ET Case-Shiller home prices
4/29 8:30 ET Q1 GDP first guess
4/29 2:00 ET FOMC Fedlines
4/29 2:30 ET CGP presser
4/30 8:30 ET Pers Inc and Cons Spend
4/30 9:45 ET Chicago PMI
5/1 9:45 ET Markit Manu PMI
5/1 10:00 ET ISM Manu PMI

Key Economic Events Week of 4/20

4/20 8:30 ET Chicago Fed
4/21 10:00 ET Existing home sales
4/23 8:30 ET Weekly jobless claims
4/23 9:45 ET Markit flash PMIs
4/24 8:30 ET Durable Goods

Key Economic Events Week of 4/6

4/8 2:00 ET March FOMC minutes
4/9 8:30 ET Producer Price Index
4/10 8:30 ET Consumer Price Index

Key Economic Events Week of 3/30

3/31 9:45 ET Chicago PMI
4/1 8:15 ET ADP Employment
4/1 9:45 ET Markit manu PMI
4/1 10:00 ET ISM manu PMI
4/2 10:00 ET Factory Orders
4/3 8:30 ET BLSBS
4/3 9:45 ET Market service PMI
4/3 10:00 ET ISM service PMI

Key Economic Events Week of 3/23

3/24 9:45 ET Markit flash PMIs
3/25 8:30 ET Durable Goods
3/26 8:30 ET Weekly jobless claims
3/27 8:30 ET Personal Inc and Spending

Key Economic Events Week of 3/9

(as if these actually matter)
3/11 8:30 ET CPI
3/12 8:30 ET weekly jobless claims
3/12 8:30 ET PPI
3/13 8:30 ET Import Price Index

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