Desperate Bank Shorting Continues
Again, the paper derivative price of gold can only go up if there are is more demand for the derivative than there is supply. And with The Banks increasing supply by nearly 9% on Friday, and God only knows how much again today, you get a gold price that is only up a few dollars, despite crashing equities and soaring bonds.
So, what are you going to do? STACK! THAT'S WHAT YOU DO! In the meantime, here's a rundown of some of the
carnage market action so far today. Let's start with forex where we've got the all-important USDJPY down 2/3 of a point while the British Pound is making new lows versus The Pig...even lower than early Friday!
This while global bond markets are soaring. You might read this from ZH: http://www.zerohedge.com/news/2016-06-27/developed-market-bond-yields-crash-record-lows But then check these charts. Here are the 10-year and 30-year US rates. So far today, the 10-year note is down 10 bps at 1.48% (the alltime low is 1.38%) and the 30-year Long Bond is down 14 bps at just 2.30%! Two point two nine percent!!!
Check out the German 5 and 10 year bunds! The 5-year is down 1 bp at -0.55% but the 10-year is off 6 bps at -0.11%!! WOW!
And while we're in Germany, perhaps we should check in on our old pal, DoucheBank. No shock, I guess, that it's making a new ALLTIME low again today at $13.64. And it's not just DB...it's nearly ALL of the Eurozone banks that are in trouble. See this from ZH, too: http://www.zerohedge.com/news/2016-06-27/its-fking-bloodbath-european-banking-stocks-collapse-uk-default-risk-spikes
All of this adds up to another tough day for the Paperbugs as equities across the globe are tumbling. Of course, we all expect some major attempt by the global Central Planners to rescue "the markets" but when will it come and how effective will it be? I guess we'll just have to wait and see. In the meantime, the S&P is down another 35 points as I type and clinging to the psychologically-important 2000 level at 2002. Uh-oh...
So, now that you're caught up, let's turn to the metals and miners. If you haven't yet read the opus that we posted back on Saturday morning, I strongly urge you to do so. The final open interest tallies for Friday are in and it's every bit as disgusting as we thought. On Friday, with The Banks reeling from Brexit and the overnight surge of nearly $100, these Criminal Bullion Banks added a whopping 50,091 new paper gold contracts to the "market", effectively increasing the total available "float" of contracts by 9%. Again, where else would this type of fraud and market manipulation be tolerated? So, how/why was gold forced back down from $1360 overnight Thursday and from $1335 to $1315 during Comex hours? The Forces of Pure Evil simply created from whole cloth over 5MM ounces of new paper gold to feed to the hungry Specs. Without this new 156 metric tonnes of paper gold supply, how high might gold have risen on Friday? Without all of the new paper tonnage that The Evil Ones are issuing again today, how much higher would price be this morning? As it stands and regardless, gold is up a whopping $8 as I type at $1330....adding another $200,000,000 in paper losses to Cartel Bank P&L sheets.
Note, too, that by adding all of these new shorts, The Banks have also been able to maintain price within the channel we've been following so closely here lately. Look closely at where the rally was deliberately halted overnight! Will they be able to keep things under control? I suppose they will until they simply can't. When will that be? It's hard to say for certain but the date was moved up considerably by the vote back on Thursday!
And turning to silver...As we discussed back on Friday, DO NOT read too much into silver's relative "underperformance" on Friday or early this week. There are two, major items effecting it:
- The POSX is rallying due to all of the Euro turmoil. This is causing the HFTs to sell all commodities and this is leading to a drag on paper silver.
- The July silver comes off the board on Thursday and trades First Notice on Friday. <Edit: Turd cannot read a calendar. July silver comes off on Wednesday and trades First Notice on Thursday.> If you've been around here long enough then you know how this works. Spec trading positions (at a ratio of 4:1 LONG) are being taken off and rolled. This is A LOT of selling that is not entirely replaced by new buying.
As I mentioned Friday, I am therefore uninterested in buying any paper or real silver until around Thursday. Between now and then, I'm just watching. On the bright side, silver is UP 3¢ as I type at $17.84 and, IF it can hold here, it will post a new closing high for 2016. For what that's worth, I'll take it! Again, what I'm waiting for is for silver to break and close clearly above the trend arrow shown on the chart below. As you can see, the action today is making me quite optimistic about what is coming next.
And, finally, the HUI hit a new 2016 high of 245 earlier this morning before Cartel metal pressure and general equity selling shoved it back to its current level near 240. Meh, whatever. Have I been concerned about the shares lately? No. So am I concerned about the HUI only being up 3 points as I type? No.
OK, so here's about the only potential bad news I can find...
After I hit send on this post, I have to head out to the DMV in order to register MrsF's new car. Longtime Turdites will recall that about every time I go to the DMV, the metals get smashed while I sit in limbo, waiting for my number to be called. So, be careful out there today! (And pray for my general patience level.)
More later with a full podcast summary and review.