One Day To Brexit Vote

89
Wed, Jun 22, 2016 - 10:53am

With the Brexit vote coming up tomorrow, today we should take a moment to consider what should happen with gold following the outcome.

The first thing you need to know is that this is NOT a done deal. The assumption since last Thursday is that Brexit will fail...and it likely will. The City of London almost always gets what The City of London wants. To think that the hoi polloi will be allowed to advance an agenda that is NOT in The City's interests is almost unfathomable, sort of like those believing that a new Glass-Steagall will be passed one day in the U.S.. The Financial-Political Complex overpowers everything through bribery, greed and corruption so to think that popular opinion would be allowed to override them?...Well, it's a longshot.

That said, the polls remain close and be sure to check this from ZH. As you know, ole Turd knows a little about bookmaking so, to me, this makes perfect sense. Essentially, the bookmaker simply desires equal amounts of money on each side of the wager. The amount of individual bets tells you something about the supposed "smart money" but it can be misleading. What this ZH post shows is that there is a huge amount of individual bets on Brexit but an equally huge amount of money...in much larger chunks...on Bremain. Now why would that be? Does the "smart money" know something that the "squares" do not? Or is someone attempting to influence opinion by placing big bets in order to drive the odds toward Bremain. This is an interesting question to consider in the remaining hours before the vote. https://www.zerohedge.com/news/2016-06-22/something-strange-emerges-when...

And here's yet another major English newspaper coming out with an endorsement of Brexit: https://www.dailymail.co.uk/debate/article-3653385/Lies-greedy-elites-di...

And don't forget who reads newspapers and which is the most likely demographic to turn out in large numbers...old(er) people. And which group is most likely to reject the EU in favor of British "patriotism"? Old(er) people. Just sayin'.

So, again, this is far from a done deal, regardless of The City's desires. Sit tight and be ready. Tomorrow will be fun!

To that end, let's now talk about gold and the impact of the vote on paper gold "prices". It will be easier to discuss this verbally and we'll attempt to do so in today's podcast which, God willing, I'll be able to post before 8:00 pm EDT.

Here's where ole Turd stands...and this is NOT because "Turd is just a permabull who always says BTFD". Everything and every scenario says gold is going to rally, NOT plummet. Why? Let's list a few of the reasons:

  1. How much "Brexit risk premium" was pumped into gold in the first place? Gold was $1213 and down nearly $100 from its highs before the June BLSBS put an end to the Fed Goon Jawboning Parade. After the BLSBS, it closed June 3 at $1243. It then rallied over the next two weeks, anticipating a dovish FOMC and was $1284 when the Fedlines were released one week ago today. How much of that rally was FOMC-related and how much was Brexit-related? Maybe 80/20? Maybe. In fact, Brexit really only entered as a legitimate possibility early last week. So, considering that gold is now $50 off its peak last Thursday, I think the "Brexit risk premium" is already done, gone and out.
  2. So this actually puts gold DOWN $16 or 1.3% since the extremely dovish and dissentless Fedlines of last week! What? That's crazy!! All this does is once again prove the old adage that, if you want to make money trading the metals, you must always "sell some when everything looks great and buy some when everything looks terrible".
  3. From an HFT-algo perspective, EITHER vote scenario should be gold bullish. Why? A Brexit vote will dump the euro but surge the yen. This would/could/might blow the USDJPY all the way to and through the 101 target we've been discussing. Bond futures will soar worldwide, too, as "investors seek the safe haven of fixed income". These two combined should drive heavy HFT gold futures buying. But what about Bremain? If this occurs, the Euro will rally...at least it should. And the euro is about 60% of the POSX. A 2-3 point rally in the Euro would drive the POSX back toward 92. After an initial shock, the HFTs and smart human money managers everywhere will begin to focus upon the tumbling Pig and Fed dovishness...as they should have been doing every day since last Wednesday...and you'll get a quick bounce and recovery from any selling.
  4. And, in the end, simply look at price and history.

"What does that mean Turd? Please elaborate on point #4." OK, I'll be glad to.

Recall what happened in May. Gold surged toward the critical $1308 point? What did The Cartel Banks do? They desperately capped and capped and then brazenly used all of the Fed Goon jawboning as an excuse to ram prices back down and, MOST IMPORTANTLY, cover over 100,000 naked shorts BEFORE The Fed actually announced that they were powerless and neutered. So, as price rallied on the actual news of June 3 and June 15, The Banks were able to control price and keep it below $1308 by issuing back out the same old paper that they had issued in April. So, what has the past 4 days been about? It's the exact same trick/strategy!

The Cartel Banks have used the Bremain sentiment since the Cox assassination as cover to raid price, drive Specs back out and cover shorts. That way, when price begins to rally again regardless of the outcome, they'll have shorts to issue as they attempt again to keep price below $1308. See how that works? Just yesterday, we saw an overt raid of $20 and an open interest decline of nearly 10,000 contracts...back to 571,000. With prices down a little again today, who knows how many more nervous-nelly Specs are heading to the exits ahead of the vote.

The point is...Just as in May, The Banks KNOW what is going to happen next. The paper price of gold is going to rally in the days and weeks to come, regardless of the outcome of tomorrow's vote. Therefore, just as in May, they are desperately using any and every opportunity to scare out some Specs and cover some shorts. Got it? See what I mean? Again, we'll try to make some sense of all this in today's podcast.

For now, gold is down $5 as I type and, earlier today, came very close to tapping its 50-day MA and the lower band of our channel...which we've been mentioning as a likelihood since Sunday evening. What's my strategy? Sit back, relax and watch the fireworks. If I can remember tonight, I think I'll even order another shiny ounce of gold from JMB or GoldenEagle. I mean, why not? Get it while you can! Again, I absolutely expect the 50-day to hold and that the hand-crafted/painted double top on the chart to fail. My target next remains $1340.

And one more thing...As the world moves on from "All Brexit, All The Time", I though that this little tweet was interesting:

Have a great day but be sure to check back much later for a full podcast.

TF

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  89 Comments

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Angry Chef
Jun 23, 2016 - 10:53am

Alien Eyes/TPTB/And the Quebec Separtiste Vote

Alien eyes,

You must be Ferengi. Is that where your eyes come from ? For I don't speak your language. For me TPTB have been working behind the scenes for 500 years. It reminds me of a quote I heard regarding the supposed approaching currency reset...." You don't think we're going to just hand over what we've been working on for 500 years to the Chinese...do you " ? A lot of these megalomaniacs are nothing more than useful idiots. Even the most brazen.

I lived in Quebec during the Separtiste Movement. I voted in that referendum. By chance it was a paper ballot vote as well as todays BREXIT vote. The result ? 51-49 in favour of staying in Canada. TPTB pulled it off then and they'll pull it off now.

Jun 23, 2016 - 9:55am

Resource War Extraterrestrial Front

The search for resources to grab reaches interplanetary distances

(copied from The Setup For The Big Trade thread in the forums section)

The Government of Mars Is Already Being Planned - #NewWorldNextWeek

So planet Earth's resources are leveraged up to their eyeballs, and the elite are staring a deleveraging crisis in the face. The horrors of their cushy number going away forever must keep them awake at nights!

No problem! Let's just toss in another planet's future extracted resources, discount to present value, and collateralize that! Simple.

OOOBuck
Jun 23, 2016 - 8:54am

JQuest - two bits on Russia and WWII

Right on the mark brother. That is exactly how I see it too but sadly, few others in America.

amarula4
Jun 23, 2016 - 5:12am

I just voted LEAVE in the Brexit (somewhat a tautology), but I

want out of the EU...never wanted in, never believed it was about trade in the first place, not that I was old enough to vote in the 1975 referendum...

so, we have twelve (12) hours until polls close, at 10pm UK time, and then the informal exit polls will be accurate enough to know the result. Then on Friday 8am the stock markets and currency markets will react, or more likely over-react, and then next week it will be back to normal.

I am guessing that a cheeky short on the FTSE100 will net some points whatever the result, more if a miracle LEAVE vote comes in, less points but still worth the gamble, if the relief profit-taking on the highly likely Remain result comes in. Let's see...

infometron
Jun 23, 2016 - 12:48am

Financial-Political Complex

Good one, Craig! I'm sure Ike would be the first one to hat tip you on that!!

infometron
Jun 22, 2016 - 11:53pm

@AE Re: the backstabber

You nailed it man. After Canada helped liberate France twice within a few decades, overriding Quebec's objections to so serve in WWII, he is invited to Canada, and this is what he has de friggin' gaulle to do: https://www.youtube.com/watch?v=XasQu5YQFUM

Canada suffered decades of Quebec separatist movements and referenda thereafter.

How's that for backstabbing? Can anyone beat that?!

PS. I think it was around 25 years later, 1992, France proposed to issue a stamp commemorating the 25th anniversary of the occasion. They scuttled the idea after Canada formally objected. Duh! If ever there was a example of how completely self-absorbed the French can be, there ya go! They laugh at Joual, by the way.

As for me, I love French Canadians, especially the music of Daniel Lanois

Daniel Lanois Fisherman's Daughter
JQuest
Jun 22, 2016 - 10:30pm

Re: AlienEyes/Angry Chef

My two bits on Russia and WWII.

Russia diverted and ate up a ton of Hitler's military hardware and men on the eastern front which I believe was planed by Churchill and FDR. I could be wrong but without Russia's sacrifices Normandy would have been successfully defended by the NAZI's if not for the Russians. Remember right at the end of the war Hitler had developed the jet engine for building fighter jets and the V2 Rocket.

JMHO

JQ

matt_
Jun 22, 2016 - 9:51pm

Sniper tech

That is cool. I can't believe the scope is WIFI connected so you can view it on your phone. Crazy.

There is something about the simplicity of a classic rifle with iron sights, or the process of zeroing a scope. I think all that tech would take some of the enjoyment I have at the rifle range, but I must admit it is bad ass.

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AlienEyes
Jun 22, 2016 - 9:47pm

Angry Chef

Actually, I saw it on a documentary many years ago. You are of course free to believe whatever suits your fancy. I care not.

You often seem to see all things as the work of TPTB. It leaves you ill equipped to realize that many if not most of the bad things that happen are the work of ego driven megalomaniacs that should have been kept on a very short leash. The tactic used by TPTB is that power is most effective when least used. You seem unaware that TPTB would have been neutralized decades ago if they were involved in five percent of what you give them credit for. It is not the way the game is played. "Use it (power) only when you must and then use it well."

Angry Chef
Jun 22, 2016 - 8:58pm

Alien Eyes / Charles De Gaulle

Well with 15 ( or more depending on who is stating ) assassination attempts, De Gaulle must have done something to irk TPTB. Like perhaps....calling out the US Treasury for printing more dollars than they had Gold....

We all know Russia won the War. I've never heard anything about De Gaulle running around saying France won the War. References please...and pass some " Freedom Fries " while your at it.

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