Wow. The Forces of Darkness are fighting us for every last tick, nakedly issuing new Comex contracts at a record pace in a desperate attempt to hold gold back from new 2016 highs. Will they win again? When was the last time they lost?
I must admit to a certain level of frustration today. After yesterday's reversal and rally, gold appeared to be on the verge of another breakout. Instead, after surging $10 higher to $1284 at the "Asia open" last evening, gold is now down $20 and back to $1264. How/why?
- First of all, incredible naked short issuance by The Bullion Banks on the Comex. Just yesterday, they increased the total open interest by 15,000 contracts to a new multi-year high of 504,000. This represents new obligations to deliver up to 1.5MM ounces or 47 metric tonnes but did The Banks deposit any additional gold or put up any extra gold as collateral? Of course not.
- Price was sat upon all night long as we even saw a return of The London Monkeys after a 3-day absence. Here's a look at price immediately following the Asia open.
- Next, we get the standard London PM fix screw job where price is suddenly smashed for $5 just as the Fix is determined:
- And now, at 10:30 EST, I look up to see price at $1258 and down $15 on the day, $26 or 2% from the "Asia" highs. Ridiculous. Is there any accompanying news? No. Has the euro given back all or even part of its gains from yesterday? No. Has the yen suddenly plunged, taking gold with it? No. This is nothing but plain, old standard Cartel raiding. Brutal. Totally unfair. Completely manipulated. Sickening to watch.
So, is that it? Are we doomed to suffer another massive raid and Spec rinse cycle? It's hard to say. The FOMC and accompanying "fedlines" next Wednesday will go a long way toward determining what happens next? Will Mother raise the FF rate again? I doubt it. Will she and her Goons proceed to jawbone their way to dollar strength? Yep. And will The Cartel use this jawboning to raid price even further because "all is well, the economy is strong, markets are surging, rates are headed higher"? Of course.
We will, most definitely, have to watch the charts closely. For now, both metals are hanging tough despite all of the repeated raid attempts and incessant creation of paper metal.
At the end of the day, this is all criminal behavior but what do you expect from a bunch of unregulated criminals? Since the end of January, they've now issued over 130,000 new Comex gold contracts to meet the Spec paper demand. That's 13MM paper ounces or 404 metric tonnes. These banks don't have this gold nor do they intend to find and deliver it. They're simply waiting the process out. Hoping/planning to smash price with such force that the Specs will rush the exits. This Spec selling will allow The Banks to buy back and cover their shorts, thereby reducing open interest and closing positions without ever having to deliver any metal. It's criminal. It's fraudulent. And it's the way business is done on the Comex.
As you can tell, I'm a little beaten down today so I'm planning to take the afternoon off. My pal, Sweetness, is in town so I'm going to watch a little basketball, drink a little beer and play some golf...though not necessarily in that order. As such, there WILL NOT be a podcast this afternoon. We'll record and post one tomorrow morning, instead. (And don't go complaining about how you need me to read the CoT for you. I can tell you right now that it's going to be horrific with the largest Commercial NET short positions in years. We'll deal with that tomorrow.)
Have a great day and try to find some solace in the fact that LIES cannot continue forever. The TRUTH always wins and The TRUTH will one day set prices free.