What Now?

Thu, Jun 23, 2011 - 4:28pm

What an interesting seven weeks it's been. From the jubilation of late April to the frustration of early May to the despair of today, we've certainly ridden the trader rollercoaster.

I've tried to lead the way through the darkness but this sorcerer/soothsayer stuff is pretty challenging, particularly when you're dealing with a criminal enterprise on the other side of your trades. Regardless, let's recap so that we can begin to decide where to go from here.

First, back on May 18th I gave you what some began to call a "roadmap". Here's a link:


I'll be the first to admit that the silver prediction for June came up short. I was looking for a rebound to $42-43 based upon the same fundos that had driven silver since August. The fundos are undoubtedly still there but the buyers aren't. All of the C/C/C shenanigans have scared them away for now. Silver made it to 38.84 on 5/26 and 38.76 on 5/31 but that was it. The gold prediction turned out pretty well, however. I was looking for a June peak between 1560 and 1580 and we made it to 1559.30 yesterday. Here, then, are the salient points going forward:

"5) Having accomplished all of this by the end of June, the metals will enter their typical summer doldrums. Silver will have painted a double top on our "white out" chart. Gold will have a near perfect double top on its actual chart. The PMs will selloff through July and into August, just like they did in July and August of 2010 and then January and into February of this year. Gold will likely retrace all the way to $1450 or so. Silver will trade back down to this 33-35 area.

6) By this point in late summer, all will seem lost. Every two-bit technician and topcaller will be proclaiming the end of "The Great PM Rally", just like they did back in late January. But it won't be the end, it will be the start of a new beginning.

7) The metals will rally from late summer into December. Gold will trade to a peak near $1750. Silver will again trade near $50, this time for real."

Then, there's this, which I wrote on June 8:


In this post, we discussed how a rallying POSX might be the final nail-in-the-coffin for the gold rally from January. I hoped that it wouldn't be but I feared that it was. (Against my own advice, I bought those August gold calls Tuesday. Turd dumdum. "Walk in middle of road. Get squished like grape.") From this post, here is the most important point:

"The dollar rally has added to what was already a rather tenuous position for gold. Take a look at the chart below. If we again use the white-out to wipeout the blowoff from early May, we get a chart that made a top about five weeks ago, corrected down, moved back up and now has made an attempt at a "new high". Failing the new high, it instead has rolled over and is now pointing lower. I hope I'm wrong but it looks like we have found our range for the summer. It looks now like gold will trade between 1470 and 1550 for the foreseeable future. Do not despair, this pattern of four months UP and two months sideways has been going on for years in this bull market. This new range would just be a continuance of the pattern and it certainly is consistent with the "roadmap" I posted several weeks ago. I still believe that, by late summer, gold will finally break higher and rally toward a December high between 1700 and 1780."

So, how does this relate to today? To me, today's action was the final, crushing blow to the 5-month rally in gold and the hoped-for recovery in silver. I now have no doubt that Santa, Turk et al will be proven wrong over the summer. There will be no "explosive" summer rally that will "confound the experts" and "make contrarians money". The PMs will simply be in another 8-week consolidation phase as they prepare for the next 18-week rally, which should begin by late August/early September. Until then, my advice to you is to not play. If anything, take advantage of dips toward the lower end of the described ranges by adding and stacking your physical. You'll have several opportunities over the next 8 weeks or so to buy some physical on "sale". If greed convinces you to trade paper on the Comex, you will only find yourself in the end with less fiat than you started with and you're going to want as much fiat as possible in your warchest when the next major UP move begins.

I leave you for now with these words of wisdom that Santa emailed out earlier today. Relax. Be happy. Enjoy the summer. Be ready for fall. TF

Dear Friends,

Economic statistics are taking a hard fall.

Without QE who will buy US treasury issues?
Without QE where is the basis of world equity markets?
Without QE what do you think the chart of unemployment will look like?
Without QE how do you think the camouflage of the insolvent balance sheets of the financial industry will fare?
Without QE where is mortgage money coming from?
Without QE what do you think home prices will do?
Without QE how will the present Administration and the legislative be re-elected?
Without QE how will the States of the United States of America finance themselves?

Be prepared for a reversal of the decision to curtail QE at the end of June.
Be prepared for a snap back at a greater percentage of QE with a different name.
Be prepared for covert QE between July 1st and late August when stimulation goes wild.
Be prepared for gold to take out $1650 on the upside as magnets at $12,544 come into play.
Be prepared for the Inflationary Depression of all time.

Stand firm on your gold positions.
Stand firm on your discipline of NO margin.
Stand strong in your Swiss Franc and Canadian dollar positions.

Survive the MOPE and market manipulation that is so obvious today.

Respectfully, Santa

About the Author

turd [at] tfmetalsreport [dot] com ()


Jun 24, 2011 - 5:56am

Very confidence instilling

Very confidence instilling words by Santa.

Well, they've already admitted to continuing QE as QE Lite, but I too think that will not prove to be enough. But it's already enough to push gold and silver prices much higher, although they are of course, right now, artificially held down (with great effort I might add - look at the now nearly 2000 tonnes of silver that were sold from SLV into the open market over the last 1, 2 months).

I wouldn't describe the current situation in the PMs as despair. I personally find it boring.. perhaps a little exhausting. But obviously the lows have been found (a little under 1500 for gold and a little under 33 for silver), and from here it's just waiting for it to go up again.

- Markus

Jun 24, 2011 - 5:58am

Ah yes and it helps too that

Ah yes and it helps too that the 200day MA in silver is now around 31,5$. Every day this is moving more towards the current level of around 35$.

You gotta realize that a drop towards the 200d MA would cause a lot of people that are sitting on the sidelines to buy.. in a already tight market. The EE cannot allow that to happen.

- Markus

Jun 24, 2011 - 6:05am

Re: beatlebum19

"The United States once held more than 85% of all the silver in the world in the 60's the U.S. alone had 353 billion ounces of Silver, there is now a recorded 33 Billion ounces of silver left."

Where do you get your numbers mate? According to my numbers, world inventories are around 1-3bn oz.

You wouldn't even get to a 33bn oz number for the US if you count all the government owned silver (none), those of private individuals (very little) and the funds (also very little to none).

But yeah, anyone who can add 1 + 1 should be able to come to the conclusion that due to the fact that silver is used and gold is hoarded AND that there are a lot more years of mining supply in gold left than in silver, that silver will at one point be more valuable than gold.. and that despite the fact that gold will also rise dramatically.

- Markus

Capt. Willard
Jun 24, 2011 - 6:20am

Brainstorming the PMs

Where is Gold going to close?

Below 1517 $/Oz., because very few want to carry their positions over the weekend?

200d MA for Gold is somewhere at 1408 $/Oz. Is Gold going to range trade and wait for the 200d MA to catch up a little around the month of August? It's hard to wait for RSI and all the rest of the indicators to touch oversold, if you eyeball Santa's prediction for the PMs to rallye during the summer.

I feel like a fox chasing after two rabbits and they seperate to the left and the right. I tend to believe we're seeing lower prices still. Franklin Sanders over at goldprice.org commentary believes the point to back the truck up is approaching and close, but there will be lower lows before that.

Jun 24, 2011 - 6:59am

Crime Stoppers


Every city has a police dept. anonymous tip help line. They offer some cash reward for good information to solve crimes. They call it the"Crime Stoppers" tip line.

I just wonder why one or two high net worth types, or a bunch of little Turds, don't offer a reward of some kind for some good whistle blower information.

Andrew McGuire gave up some information for free. There has to be some down on their luck or greedy guy or gal who would gladly give up some good info for some cash.

When I hit the lotto I will be giving up some BIG CHEESE for some step by step....this is how they're sticking it to you in 3 easy steps....solid, verifiable, stop the presses the game is over information.

I want names, faces, favorite color, everything about these Silver Manipulation Masters...........BASTARDS!!!!!!!

Have a nice day. Good job on the website Turd!

Jun 24, 2011 - 7:43am

Was it always like this?

Rumours have been around since 1999 about Comex default, PM manipulation and gold and silver to the moon. Is it really different now? I am just asking because I want to try to get a balanced perspective. Things get pretty hysterical and cultish around here. To make good investment decisions you need to be balanced.

I remember Greenspan was worried about deflation in 2000. For those old enough to remember - was there talk of fiat collapse in 2000 and 2002 too? Is this just Groundhog day?

Jun 24, 2011 - 8:03am
Jun 24, 2011 - 8:22am

Too funny

"I am just asking because I want to try to get a balanced perspective. Things get pretty hysterical and cultish around here. To make good investment decisions you need to be balanced."

First laugher of the day, and it's a good one!

Jun 24, 2011 - 8:31am


  1. 8:31a

    Q1 GDP below up 2.0% forecast

  2. 8:31a

    U.S. Q1 GDP up 1.9% vs 1.8% prev est.

  3. 8:30a

    May durable-goods slightly above expectations

  4. 8:30a

    U.S. May durable-goods orders up 1.9%

Jun 24, 2011 - 8:32am

Well, well. well, those July

Well, well. well, those July 40 calls I've been holding for a while and expire in a couple of days are consigned to the turd bucket. Not you turd but the real thing! Yesterday ask was $0.07, no takers. lol Can't expect every trade to be a winner............ O but those Oct. 30 puts I picked up a couple of days ago, sweet. Hopefully I can get out with a small gain to make up some flat. Turd I'm still reading every day, hang in there. Doldrums can dishearten even the most disciplined.

Subscribe or login to read all comments.


Donate Shop

Get Your Subscriber Benefits

Private iTunes feed for all TF Metals Report podcasts, and access to Vault member forum discussions!

Key Economic Events Week of 8/19

8/21 10:00 ET Existing home sales
8/21 2:00 ET July FOMC minutes
8/22 9:45 ET Markit Manu and Svc PMIs
8/22 Jackson Holedown begins
8/23 10:00 ET Chief Goon Powell speaks

Key Economic Events Week of 8/12

8/13 8:30 ET Consumer Price Index
8/14 8:30 ET Retail Sales
8/14 8:30 ET Productivity & Labor Costs
8/14 8:30 ET Philly Fed
8/14 9:15 ET Ind Prod and Cap Ute
8/14 10:00 ET Business Inventories
8/15 8:30 ET Housing Starts & Bldg Permits

Key Economic Events Week of 8/5

8/5 9:45 ET Markit services PMI
8/5 10:00 ET ISM services PMI
8/6 10:00 ET Job Openings
8/8 10:00 ET Wholesale Inventories
8/9 8:30 ET Producer Price Index

Key Economic Events Week of 7/29

7/30 8:30 ET Personal Inc/Spending & Core Inflation
7/30 10:00 ET Consumer Confidence
7/31 8:15 ET ADP employment
7/31 2:00 pm ET FOMC Fedlines
7/31 2:30 pm ET CGP presser
8/1 9:45 ET Markit Manu PMI
8/1 10:00 ET ISM Manu PMI
8/2 8:30 ET BLSBS
8/2 10:00 ET Factory Orders

Key Economic Events Week of 7/22

7/23 10:00 ET Existing home sales
7/23 10:00 ET Richmond Fed Manu Idx
7/24 9:45 ET flash Markit PMIs
7/25 8:00 ET Count Draghi/ECB policy meeting
7/25 8:30 ET Durable Goods
7/25 8:30 ET Wholesale Inventories
7/26 8:30 ET Q2 GDP first guess

Key Economic Events Week of 7/15

7/15 8:30 ET Empire State Fed Index
7/16 8:30 ET Retail Sales and Import Price Index
7/16 9:15 ET Cap Ute and Ind Prod
7/16 10:00 ET Business Inventories
7/17 8:30 ET Housing Starts and Building Permits
7/18 8:30 ET Philly Fed
7/19 10:00 ET Consumer Sentiment

Key Economic Events Week of 7/8

7/9 8:45 ET Fed Stress Conference, three Goon speeches
7/10 8:30 ET CGP Hump-Hawk prepared remarks
7/10 10:00 ET CGP Hump-Hawk House
7/10 10:00 ET Wholesale Inventories
7/10 2:00 ET June FOMC minutes
7/11 8:30 ET CPI
7/11 10:00 ET CGP Hump-Hawk Senate
7/11 12:30 ET Goon Williams
7/12 8:30 ET PPI

Key Economic Events Week of 7/1

7/1 9:45 ET Markit Manu PMI
7/1 10:00 ET ISM Manu PMI
7/1 10:00 ET Construction Spending
7/2 6:35 ET Goon Williams
7/3 8:15 ET ADP June employment
7/3 8:30 ET Trade Deficit
7/3 9:45 ET Markit Services PMI
7/3 10:00 ET ISM Services PMI
7/3 10:00 ET Factory Orders
7/4 US Market Holiday
7/5 8:30 ET BLSBS

Key Economic Events Week of 6/24

6/25 10:00 ET New Home Sales
6/25 1:00 pm ET Chief Goon Powell
6/25 5:30 pm ET Goon Bullard
6/26 8:30 ET Durable Goods
6/27 8:30 ET Q1 GDP final guess
6/28 8:30 ET Personal Income and Consumer Spending
6/28 8:30 ET Core Inflation
6/28 9:45 ET Chicago PMI

Key Economic Events Week of 6/17

6/18 8:30 ET Housing Starts and Building Permits
6/19 2:00 ET FOMC Fedlines
6/19 2:30 ET CGP presser
6/20 8:30 ET Philly Fed
6/21 9:45 ET Markit flash June PMIs

Recent Comments

Forum Discussion

by Boggs, 20 min 49 sec ago
by Scarecrow, 5 hours 34 min ago
by Scarecrow, 5 hours 52 min ago
by Scarecrow, 7 hours 16 min ago