Squeeze

119
Fri, Dec 4, 2015 - 11:20am

As we discussed just yesterday, with the CoT structure very likely at historic and unprecedented levels, the next move for the metals was going to be UP, not down. We've also frequently mentioned the likelihood that an FOMC rate hike would be a "sell the rumor, buy the news" type of event. With those two items in mind, we can't consider today's market action to be a surprise.

Let's dive right in as I'm running a little behind schedule. I'm honored to have taken on a new responsibility for the greater community and I look forward to sharing the news with you later today. For now, though, let's head straight to the charts.

Below are the 2-month gold and silver charts that we've studied a couple of times this week, most recently yesterday. Maybe it's just me, but I think it's quite easy to see which way these patterns have resolved themselves this morning:

Alright, so, what should we root for over the remainder of the day. Well, let's keep it simple. As you know, the first major hurdle for this next/current rally is 80 gold and .40 silver. While I'd love to see prices extend even higher today, as we close the day and wrap up the week, all I want is a close above these levels. Not asking for much, I know...but...as they say...beggars can't be choosers.

Once solidly above 80 and .40, we can set our sights upon the next major resistance. As you see below, that level is 05 in gold as well as the 50-day moving average, currently near 20. In silver, will be a challenge and the 50-day near there will be, too. Expect the SPEC shorts to put up a battle there in a desperate attempt to regain the downward momentum. They'll throw good money after bad but they will lose. Little do they seem to know...they have no chance. The Banks always win this paper game and The Specs always get the shaft. That's just how it works.

For further evidence that this is a serious Spec short squeeze, check the divergence between gold and the yen today. If the smarty-pant, momo-chasing Specs think things are painful today, wait until the yen rallies later this month. The pain will be amped up considerably at that point. Christmas won't be their only "religious experience"!

Again, there's A LOT of fuel here. The gold CoT we get later today will again show new record extremes in Spec and Commercial positioning...and with the OI increase since Tuesday, the extremes have already grown some more. Of course, we're seeing considerable Spec short covering today but the CoT is still at historic levels. Be sure to keep this in mind.

And the HUI is just beautiful and those miners I bought earlier this week are kickin butt and takin names. It's already dealing with its own 50-day MA and I'm happy to report that, as of this moment, it's actually above that critical level. The question is: Can it close there? I think it will. Check the positive chart as well as the upwardly-trending RSI and MACD.

There's much more that I could type about here but I need to get this posted before it gets too late...and we can certainly discuss the BLSBS etc in the podcast later today. As I close, the metals are still near their highs of the day at $1085 and $14.52. Keep a close watch and hope to maintain these levels through the Comex close.

Have a fun day!

TF

About the Author

Founder
turd [at] tfmetalsreport [dot] com ()

  119 Comments

lakedweller2
Dec 4, 2015 - 11:43am

Yes it is

And it means a lot. I'm honored that Eric would extend the invitation.

Going forward, he said he's willing to discuss whatever I'd like to discuss..."it's my show"...so, do you think this might be fun? It also should be great exposure for Turdville.

silverflower
Dec 4, 2015 - 11:46am

Tell me Turd,

is today the start of another "wash and rinse" cycle? Yes, too early tell probably. But we often have seen such days as today to prevent that I am getting to excited. These banksters are still in control of the paper markets, at least as it seems.

Maybe today the market realizes that the .25 rate hike is coming. But I think things for the precious metal prices will only change if the world loses confidence in the US-$ and US treasuries.

For me personally today marks the end of the last wash and rinse process and beginning of a new one.

ReachWest
Dec 4, 2015 - 11:47am

Sprott

This is excellent Turd. You are the perfect ambassador. Look forward to listening on a regular basis.

hindsight101TF
Dec 4, 2015 - 11:51am

Good for you

Both on your new assignment and great calls this week, which I followed.

lakedweller2
Dec 4, 2015 - 11:54am

@TF Sprott

Also they are using that "Craig Hemke" pseudonym. Great!

CC Horses
Dec 4, 2015 - 11:55am

Hugo Price Salinas: The Crumbling World Order And Gold

https://investmentresearchdynamics.com/hugo-price-salinas-the-crumbling-world-order-and-gold/

The Chinese evidently have some plans which they are not divulging, for we see that China is purchasing huge amounts of gold. In the meantime, the US insists on trashing the price of gold, as if to say that the Dollar is and will remain the world’s supreme currency till the end of time.

China is quietly accumulating gold and saying nothing. But we can try to guess what China is thinking: “The US is mired in an insoluble problem. Do nothing to provoke the US. The US will destroy itself in a huge collapse.”

The middle class in the United States has no idea that a heavy 2×4 is being at the back of their heads. By the time many of them realize what is happening, it will be too late duck.

nadgeskaul
Dec 4, 2015 - 11:55am

Congrats TF

That's BIG.

I have to hand it to you, the CoT analysis is simply phenomenal. None of us can explain the rationale for why markets are behaving/moving like they are, but the CoT has been consistent to the T over the course of your studies on it.

Hedge Fund time? I'd be a buyer.

So, going forward, can we expect a month or two rally and then another washout as the CoT flips, hence new PM lows? Or, have we entered a new paradigm?

Libero
Dec 4, 2015 - 11:56am

Kudos to you

craig. You earned it!!!

Arag
Dec 4, 2015 - 11:57am

Congratulations, Turd !

And all the best for your new task @ Sprott !

I wish you a well deserved success, for the benefit of all the good guys !

Cheers

sakelley
Dec 4, 2015 - 12:02pm

Sprott!!!!!!!!

Congratulations, TF. It's about damn time that you start getting some of the recognition that you so richly deserve. You have earned every bit of it with your stellar work here and many interview's elsewhere. Look forward to listening to you on the Sprott News Network. Again, congrats.

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