Three More Weeks Of This?

Wed, Nov 4, 2015 - 11:13am

The slow bleed of Spec money continues today as prices drift slightly lower ahead of Friday's BLSBS. We still expect relative stability here as everything points toward Friday being an important day.

First of all, thanks to everyone for your patience and understanding yesterday. MrsF, the LTs and I all were part of an 800,000+ crowd celebrating a baseball championship. Below is an image I found on Twitter. Pretty impressive but, trust me, this doesn't do it justice. I've been a part of BIG crowds before at ballgames etc. I've never seen anything like this:

Though I expected relative stability while I was out, we still got a little downdraft yesterday afternoon. In doing so, gold fell down and back BELOW it's 2015 trendline. This is very disappointing but certainly not unexpected. I simply can't stress strongly enough the importance of recognizing and understanding the CoT structure. When The Gold Banks to increase their GROSS NAKED short position by 255 metric tonnes in just four weeks, you KNOW that they're going to raid price soon in order to cover those shorts back up. That they're doing so now and this should surprise no one!

With price $62 higher, total Comex open interest peaked at 470,525 last Wednesday. As of yesterday, total OI is already back to 443,900. This means that this week's CoT will show a dramatic "improvement" over where we've been BUT we're still only about halfway back to being neutral/bullish. This definitely implies more downside ahead and you almost have to believe that the next wave of selling will come after the BLSBS on Friday.

For now, here's where we are on the charts. Again, I expect some sideways to upward action into 8:30 Friday. After that...I'd say $1095 to $1100 should be our base for the next few weeks while some intraday stuff back below $1090 is possible.

The Silver Specs are in the midst of their own rinse cycle right now and it's only about halfway over, too. Total Comex silver OI also peaked on October 28 at 176,038. (Recall how many times we mentioned one last surge to draw as many into the trap as possible?) In just the four trading days since, price has fallen by $1.05 and total OI has dropped to 166,942. This 9,000 contract contraction is a start but it needs to fall another 10,000 or so for a full washout back to where it was in late September.

In doing so, price fill undoubtedly fall further, too. As of today, silver remains above its trendline from the August lows but you can bet your booty that The Forces of Darkness will be gunning for it on Friday. Ultimately, I'm looking for something near $14.80 as soon as Friday and likely even something near $14.50 once or twice before the CoT is fully "washed" and back to neutral/positive.

Again, NONE OF THIS should come as any surprise to anyone here as we've discussed this at length recently. I expect price to remain pressured all month. HOWEVER, my plan is to look for some opportunity AFTER Dec15 contract expiration on the 27th of this month. That's three weeks from now! So, be patient. Understand why and how this is happening and then take advantage of this knowledge.

And another item of note...The disgustingly-leveraged JOKE that is Comex reached another dubious milestone yesterday as The Scoshe reclassified over 79,000 ounces (2.5 mts) of "gold" from their registered category. By journaling this "gold" into the eligible category, The Scoshe dropped the TOTAL registered stock of the Comex vaults down to a new record low of just 151,384 troy ounces or just under five metric tonnes. That's all!

More significantly, the unlimited and seemingly infinite ability of The Bullion Banks to lever this "gold" reached a new alltime high yesterday. Monday's total open interest was 450,584 contracts. At 100 ounces of paper gold per contract, this total OI represents an obligation of 45,058,400 ounces of gold. However, as noted above, on Monday the total registered and readily-deliverable "gold" held in Comex vaults was just 151,384 ounces. Dividing the registered stock into the paper obligations yields a total leverage ratio of 298:1. Again, I ask: How is this legal? How is this NOT fraud?

And, from ZH, here's a summary of Mother Fellen's statements on Capitol Hill this morning. More jawboning and this "hawkishness" will continue to be the theme all month. Again, IF the BLSBS comes in even slightly above consensus on Friday...

Janet Yellen, testifying on The Hill, just dropped the largest hint that December is "on like Donkey Kong" no matter what. When asked if missed inflation mandates would hold her back from liftoff, she explained...


So, take it for what it's worth and act/prepare accordingly. Another great sale is upon us...just in time for all your holiday shopping needs! December will be better and the reality of the Fed's impotence will be on display for all to see in 2016.


About the Author

turd [at] tfmetalsreport [dot] com ()


Nov 4, 2015 - 11:17am


drat second

edit: Just posted on last thread. COMEX is now at 300 to 1 with yesterday's draw down


Nov 4, 2015 - 11:21am

Almost 1

Dollar killing it

Yellen: going to raise rates in Dec or possibly buy 7 bananas at Kroger. Haven't decided. Data driven and expect banana supply to be limited due to the chilling affect of winter.

Nov 4, 2015 - 11:21am

open interest

hey Turd - does that come out late in the day typically? is instructive obviously to follow it, just curious if we can see the intraday trend...thx in advance...

Nov 4, 2015 - 11:23am

I seem to have a knack for

I seem to have a knack for taking THURD!!

How to translate that into something both meaningful AND profitable still eludes me. So I just sit....on my stack....while I watch the manipulated price drop....and wait for the day of reckoning!

Nov 4, 2015 - 11:26am

KC World Champs

Played like a baseball team should. Yogi: it ain't over til it's over. They stayed in the game and showed what a "rally" is about. Fight and hustle as a team. Excellent Champions!

Angry Chef
Nov 4, 2015 - 11:28am

Things That Make You Go Hmmmmm....

All the while we've been watching the SCO, AIIB, CIPS, Russia builds it's own we know why they continue to buy Gold.

Nov 4, 2015 - 11:42am

...or buy 7 bananas at Kroger


Full disclosure: I'm long bananas and short patience. cheeky

Nov 4, 2015 - 11:43am

Algos Kick In

Naked short the entire market because of the depth and validity of Yellens comments. Bankers need money for xmas.

Nov 4, 2015 - 11:48am



To play at being Jim Rickards for a minute (as he's been saying similar for months) - the data won't support a Fed rate hike, pretty much all real economic data is dire, therefore the Fed is actually already telling us no Dec hike. The normal CNBC crowd will of course ignore the obvious.

Nov 4, 2015 - 11:50am

For all who may have missed it

Jim C posted this in the other thread: Hello To All, This is Jim Comiskey aka The Heat Miser here. I've recently moved houses as I had a disagreement with Archer's marketing policies. I'm now with The International Futures Group. Contact info: James G. Comiskey Senior Market Strategist International Futures Group, Inc. Phone # 1-312-384-1181 Night Desk # 1-312-583-0787 Fax # 1-312-384-1195 150 S. Wacker Drive, Suite 1310 Chicago, Illinois 60606 We'll talk soon....I promise

Fred Hayek
Nov 4, 2015 - 11:53am

Turd, the site needs to fall back

This thread lists as being started at 12:13 but, where I am, EST is still a bit short of noon. Unless secret Turdville HQ is now in Atlantis, off the eastern seaboard.

Nov 4, 2015 - 12:05pm

Royals won. Take your beating Mets

The expensive senior players for Mets let their team down and certainly were/are not worth the money. Mets got 10 hits in the last two games and Conforto whom they pay league min, had 4 of them. 2 homers! Being from Oregon, Conforto from OSU, I was thrilled. Murphy and Duda's errors were inexcusable. If they didn't get paid so much just to show up, it looked suspect...Conforto is the real deal. Quick hands and power are deadly.......Barry Bonds without the roids....congrats to KC, oh- and how many runs occurred on SB? (runner off 2nd) Mets could not steal on Perez....KC stole like they were a fed member bank....

Nov 4, 2015 - 12:05pm

Bitcoin craziness

Amazing what it can do since there are no "Bitcoin Banks" issuing infinite amounts of paper derivative bitcoins to meet demand... You can follow it in real time here:

Nov 4, 2015 - 12:06pm

How About That Yen


Venezuela also looking good with a Reuters reported inflation rate of 65%. Good place to move JPM and Goldman where their skills can be recognized.

Nov 4, 2015 - 12:07pm

A reminder of some history

Nov 4, 2015 - 12:11pm

Russian plane explosion

Obviously, these two are related. Looks like the world is realizing that it was a bomb that brought down the Russian jet last weekend.

Nov 4, 2015 - 12:21pm

Yellen, aka Janey Cagney...dirty rats...

The questioning on the leak was fun...."I had no direct knowledge", she said...then the congressman asked, "did you have any indirect knowledge?" She responds, "This is a personnel issue, outside of the Fed." What a lying, dependz wearing SOS.

Nov 4, 2015 - 12:29pm

Forgot to mention in this post

The sham GLD barfed up nearly 6 mts of "gold" yesterday, dropping total "inventory" back to just 686.30 mts.

This is now down 24.51 mts YTD and 13.70 mts from the recent Oct 15 "high". This is also up 18.61 mts above the 2015 and multi-year low of just 667.69 mts seen on August 7.

Nov 4, 2015 - 12:33pm
Nov 4, 2015 - 12:45pm

Turd, at what level do you

Turd, at what level do you foresee the usd/jpy running into resistance? Trying to correlate that with the 1090 support you're calling for.

Nov 4, 2015 - 12:51pm

@Fred - RE Atlantis

I had the same problem. I fixed it by editing my tfmetals account profile. Change the time zone from New York to something else, save the changes, then change back to New York and save again. Worked for me yesterday.


Nov 4, 2015 - 1:01pm

December rate hike?

If the Chinese sense its real.....all they have to do is to devalue yuan (2-3 weeks ahead).....and you see the rate hike train being derailed again.

Nov 4, 2015 - 1:08pm
Nov 4, 2015 - 1:19pm

Thanks for the reminder

IF the metals get raided post-BLSBS, ultimately the "cause" will be a rising USDJPY.

A "surprisingly strong jobs number" will spike The Pig versus all other fiat including the yen. This will surge the USDJPY through the blue line shown below and back toward the old highs. Concurrently, stocks will soar and gold will get pounded.

That said, I'm surprised at the way the metals keep drifting lower. Therefore, there remains the possibility that the BLSBS will be neutral and near consensus...NOT an upside surprise. Not yet ready to think Friday is a slam dunk selloff and I'm not buying puts, either. Yet...

Nov 4, 2015 - 1:21pm

Nov 4, 2015 - 1:48pm

Random thoughts

Sounds like another short trade might be prudent to hedge my mining shares. Edit: Actually, I just closed out my long miner trade. I bought in yesterday after seeing the strength in the HUI.

Since the high in AU on 10-14, we have had 13 down days and two modest up days. And the losses seem to be accelerating to the downside now.

If they really do hike rates in DEC, sounds like we will be due for another run higher in the meantime (after this current takedown is resolved) to set us up just in time for a big slamdown at the end of the year.

Did everyone hear about the earthquake in Phoenix AZ? My parents liver there--pretty scary stuff indeed! I should probably give them a call and make sure everyone is OK. 
But do not underestimate the resiliency of Phoenicians..

Nov 4, 2015 - 1:49pm

Bo Po.....

......wrong again, what a shock.

Nov 4, 2015 - 1:50pm

Zerohedge Jem

new Jack Burton

Saudi Arabia is one of America's top allies, second only to Israel and the UK. Saudi could not have crashed oil prices without the "deep state" rulers in Washington's full approval. We can assume that the oil price wars were aimed at the "deep states" pet project, the bring down of the Russian Federation. Sanctions, financial cut offs and oil price crash were supposed to stress the Russian population via a deep recession to force them onto the streets in a Moscow Maidan, led by Russian NGO funded Liberals.

The USA appeared ready to lose Fracking's Miracle to get back at Russia, OR, as I believe, the "deep state" knew all along fracking was NOT what the media hype made it out to be, and that fracking was a sacrifice worth taking down RU. The problem with the Saudi American plan was that Russia has a real economy, not just energy. That economy has what Saudi does not have, "almost unlimited potential for growth using domestic resources and new build plant and equipment to service domestic demand in place of EU imports". While oil did crash the currency and cause recession, it was not a knock out blow, because Russia had nice fat reserves, lots of gold, and limited dent exposure. A bumpy ride for RU, but not something that could not be dealth with. While Saudi has not a fucking thing but those oil fields. Add 2 plus 2 and the answer is "Saudi needs oil money more than RU does". So Saudi is in trouble, while the recession in Russia is easing back into more normal growth, with expansion due to import replacement projects. Both agricultural and consumer. Is Russia still beat up by super low oil prices? Yes, but America itself is nearing a full blown financial crisis and recession. So it didn't really work.

Nov 4, 2015 - 1:54pm

Rat Puke . . . I'm Bored . . . .

This is like Groundhog Day mixed with the Exorcist (and maybe a little splash of Tillie the Toiler does Attila the Hun). For a break, here is a little local news . . .

 photo obituary_edited-1_zpskjny51gs.jpg

Nov 4, 2015 - 1:58pm
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