What Happens Next Is Key
The last time gold and silver both closed above their respective 200-day moving averages was May 18 of this year. The next day, silver was smashed for nearly 10%. With both metals once again above this key technical indicator, what happens next is clearly quite important.
The two-year charts below tell the story. The squiggly red line is the 200-day moving average:
So, can the metals grab and maintain a toehold above their 200-day MAs. If they are able to do so, speculator interest will flow into the paper markets and drive prices even higher in the short term. Already just yesterday, on the first day the paper gold price pierced this key indicator, the preliminary open interest numbers show a 19,000 contract surge of new buying. Silver saw its open interest rise, too, by nearly 4,000 contracts.
All of this late-coming and momo-chasing cash can just as easily be flushed right back out of the "market" with a dip back below the 200-day so we must be very careful here and mindful that a Cartel raid could be right around the corner.
Already this morning, gold was hit for over $15 when jobless claims came in a bit low and inflation (due to soaring rents) came in a bit high:
So, be cautious out there. Yes, the charts looks attractive and, yes, The Bottoms might be in. The world is slowly realizing that central bankers are liars and that the only option is unlimited QE. However, that does NOT preclude The Evil Ones from playing their same old games. Therefore, a swift raid of price back down and under the 200-day MAs is a distinct possibility.
On the bright side, things are definitely looking better and there are certainly several reasons for optimism. To that end, please be sure to read this: http://www.acting-man.com/?p=40685
And the USDJPY just continues to plummet. Though it bounced on the US economic data (which of course means that a Fed rate hike is right around the corner), it saw a low earlier of 118.06. Whoa! Watch this closely but don't be surprised if you see some manipulation here, too. The Bank of Japan has had their printers working 24/7 for several years now amd they won't want to see their efforts be reversed without a fight.
Just another October "delivery" update for you before we go...
Recall that 3,092 Oct15 contracts remained open at "expiration" on Sep29 and there were still 2,831 open at the close on First Notice Day, the 30th. Since then, the total open interest of the Oct15 contract has fallen to 1,016 as of last evening. However, the official "delivery" totals from the CME only show 190 TOTAL deliveries as of yesterday:
Does this seem a little fishy to you? Especially when you consider that the total Comex vault registered inventory remains near a record low of just 171,613 troy ounces? All the while, the sham GLD can magically find 250,000 ounces to add to their "inventory" just yesterday?
I tell ya...When the music stops, this is going to be a calamity of epic proportions.
How's your stack today? More shiny than ever?