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Looking Better

392
Thu, Aug 25, 2011 - 2:28pm

As predicted (hoped), both metals found some buying today after a successful test of overnight lows. Silver consistently found buyers near 39 which is right near that upsloping trendline on the 6-hour chart. Gold triple-bottomed at 1705 and has since rallied almost $60. I'd expect these rallies to continue into tomorrow. But, what happens next?

All of this will come to a head tomorrow and over the weekend. Get ready because here comes Ole Turd with another attempt to predict future events!

1) Tomorow is a "risk on" day. The POSX declines and everything else rallies ahead of the Jackson Holedown.

2) Intraday, silver trades as high as 41.80-42.20. Gold reaches 1790. Maybe even 1800.

3) Over the weekend, The Bernank "disappoints" with no QE. Instead, he issues some statements that sound a lot like the last FOMC minutes.

4) Monday is a "risk off" day. The dollar rallies and everything else goes back down.

5) Uh-oh. When the metals roll over from their highs on Friday, the charts conspicuously begin to resemble a head-and-shoulders top.

6) This re-invigorates every douchebag top-caller in the business.

7) Silver declines early next week, perhaps back down to 39.50 or even 39. Gold trades back down to near 1725.

8) This is your buying opportunity. It will take courage to step in and buy at this point but, those who do, will be rewarded.

Of course I could be wrong. Maybe The Bernank will announce a new, massive $2T money-printing scheme to match the new debt ceiling. If he does, you can forget all about the H&S top stuff as it will be off to the races, instead.

Remember, if you're going to survive trading the PMs, you always have to sell some when everyone is buying and you always have to buy some when everyone is selling. You had an opportunity to buy earlier today. You will likely have another opportunity next week. Of course, "sometimes the only winning move is not to play." That's OK, too. Just keep stacking the physical and enjoy the fireworks. TF

paper_8-25pmgold15.jpgpaper_8-25pmgold4.jpg

paper_8-25pmsilv15.jpgpaper_8-25pmsilv4.jpg

About the Author

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  392 Comments

Turdle GG · Aug 25, 2011 - 8:09pm

Turd,

I really like how you said "As predicted (hoped)..."

You are the real deal.

Turdle GG · Aug 25, 2011 - 8:12pm

He said:

"I have never seen such capitulation among people especially in outrageously undervalued gold shares"

Nice how he (?) showed those capitulators a lesson by closing TRX strong today.

gazkaz · Aug 25, 2011 - 8:14pm

Reasons to buy metals No 1,423 - time ticks until those derivatives - become payable liabilities that are too big to.........(answers on a POST(card :o)

BofA - A miniscule 0.01% loss on their derivatives takes care of Mr B's $5 Billion in the blink of an eye.
BANK OF AMERICA NA (Treasury Figs - see table 1)
(*)- No I haven't missed a number off line 2
52,504,829,000,000 Total Derivatives
*1,451,387,000,000 Total Assets
(----5,000,000,000 Buffets dribble would fit in here)

I will let you do the maths, (if the visual isn't enough)

At least Buffets tuppence ha'peny should pull the wool over the eyes (for a while)
https://www.occ.treas.gov/topics/capital-markets/financial-markets/trading/derivatives/dq111.pdf

And just for fun - to show all is well in casino land 
TOTAL COMMERCIAL BANKS & TCs WITH DERIVATIVES
243,991,249,000,000
(___14,000,000,000 & the U.S National debt by comparison - about here)

I Am The Unknown Comic · Aug 25, 2011 - 8:15pm

@tesla, friedeggs, scottj, and of course ginger, Turd, atlee, JoeKa, Pailin, and kind ol gun-totin' Granny (SilverWealth):

While you are reading my post, please enjoy this video that goes with the above picture:

https://www.youtube.com/watch?v=HaZpZQG2z10

Many here (especially the noobs) are asking "what will Ben say tomorrow" etc etc etc. I weighed in on this several times in the past few weeks over at Pailin's Trading Corner (silver forum on this website). In summary of those posts, here we go: 

1) The Fed has no other choice than to do some form of QE3. They are out of tools in their toolbox. 

2) This year continues to be a repeat of last year. Last year, the two days prior to J-Hole, PMs were taken to the woodshed and beaten like an old gypsy mule. The #1 J-Ho (Bearshankster) then proceeded to "hint" at QE2 and "discuss possible actions" that was all it took to send stocks and PMs on their steady upward pace. I remember this vividly as it was the time I lost a crapload because I was long VXX - a horrible and devastating call on my part.

3) Similarly, this year, The Beardmonkey (a.k.a. Chief J-Ho ....see picture below) will again "hint" toward QE3 and the VXX will begin to drop, and the Dow will begin to rise, and PMs will also begin to rise. From WHERE they will begin to rise is the question, because the EE continues to beat them down and will continue to do so into next week. What will QE3 be? Who knows what creative scheme they have in store for us. Judging by the successful sales of garbage US AA+ 2, 5, and 7 year treasuries this week, it probably involves "QE Twist" as it is called on ZeroHedge. We shall hear the details some time after it has already started, but doubtfully tomorrow. Bill Gross is quite certain of a QE3 hint tomorrow and I will hold him at his word. I will also trade on it. It will be nice to have some dry powder on hand next week as this kitty stalks Granny at the store to see when she sees a sale on gold and silver and buys some. Kitty will also be curiously studying the turds, reading them carefully for clues. 

Enjoy the picture of Benny the Spidermonkey J-Ho:

Turdle GG · Aug 25, 2011 - 8:15pm

"a sovereign central bank will soon announce that it is accumulating silver as a reserve asset."

Sorry, just catching up here on all the overnight news, but this latest from wynter benton is (if true) a massive game changer.

Pale Green Horse · Aug 25, 2011 - 8:19pm

Someone made the comment earlier in the blog about melting Pre-1965 coins and their melt value. Never ever, ever, ever, ever melt those coins. First they are 90% silver not .999. It costs you money to melt them, then when you go to sell the melt the specific gravity will be incorrect and an assayer will have to value them which will cost you more money. The coins as they are are easily recognizable and easily traded. Never even think about doing it.

I warned you!

Holy Grail - Killer Bunny
Jake silverbleve · Aug 25, 2011 - 8:20pm

Thanks for Posting

I know the site well and used it during my "informative years" trying to beat an unbeatable game. I can tell you that I had absolutely incredible good luck streaks. I experienced everything from wondering if I was a God to having such delusions of grandeur, that I would tell myself, (while pointing out a stranger across the bar), that I know something THAT GUY DOESN'T.

There's a book called "Does God Play Dice With The Universe". 

It discusses the idea that because existence is random, how could he have invented it? The discussion concludes that "Order" is actually the result of infinite entropy where randomness becomes totally homogenous, allowing for "God" to maintain his grasp on randomness without violating the concept of "True Order".

The main idea here is that our existence in the short term is characterized by a mixture of some randomness and some order which fools the human into thinking patterns are something that can be used to predict outcomes. 

The truth is-- this is why "traders" are fooled and can remain in a "fooled" state for lengthy periods of time.

The moral of the story is that unless your last name is Buffet and are privileged to be let in on decisions controlled by those who invent the future, you haven't a chance in the world of cashing in on predicting the future for your own gain. 

ghost Turdle GG · Aug 25, 2011 - 8:22pm

hard to decipher its entire message every time it makes a post.

notice the "strong sell" that it has in the post though... what do you all make of that?

Silver is money · Aug 25, 2011 - 8:25pm

Maybe Peru, not going to be Mexico. I doubt either to be honest. 

chinaussiedoll Eric Original · Aug 25, 2011 - 8:30pm

Dogs know ...

Justin · Aug 25, 2011 - 8:32pm

... does Warren Buffet's portfolio consist of large oil plays that have been doing absolutely nothing lately?(I have no idea what he holds other than BAC now) Maybe his attaching his name to BofA came with the stipulation that Obama and his boys at the CME would need to lower margins in oil to get that puppy heated up again. Seems like an odd time to LOWER margins on something when speculators are still long and strong in the markets, they're pretty much the only ones with the balls to take up positions in anything these days. I mean, seriously, $85 oil in peak driving season isn't doing any of those assholes any favors. Plus, we gotta get this economy slowing down just a tad bit faster if we want that next round of QE. $115 oil fits in perfectly with that scenario.

MollyRatchet · Aug 25, 2011 - 8:33pm

Interview with Peter Schiff ... and remember, Peter Schiff is always right ..

https://www.youtube.com/watch?feature=player_embedded&v=g_GPAK8xdM4

From https://silvergoldsilver.blogspot.com/

MR

ewc58 · Aug 25, 2011 - 8:33pm

Selling Against The Angels Expected

August 25, 2011, at 5:15 pm by Jim Sinclair in the category General Editorial | Print This Post Print This Post | Email This Post Email This Post

My Dear Friends,

I am amazed at the day later geniuses that send out dire warnings on gold. Selling against the upper two Angels was obvious. There is no top in gold.

Kenny places the odds at 50/50 that yesterday’s low was the low. He says that if it was not then the low is not far below.

I have never seen such capitulation among people especially in outrageously undervalued gold shares. Pros were dropping dead today. In bullion you had to walk close to the building to be safe from the golden flyers.

I have told you time and time again that gold will be violent in its exponential stage. What you have seen is nothing compared to what is to come. Truth be known, this kitchen is going to get hotter by the day so if you cannot handle the heat sell partially at each Angel until you have cut yourself back to the sleeping well size position.

For heaven’s sake stop barfing into weakness. Stop selling weakness and buying strength. That is a kindergarten type error.

Stop the margin. It will kill you. Stop watching every tick. That is certain to make you crazy.

You will in the future be very sorry you sold down to a sleeping position at Angels, but stopping pain is not an illogical purpose.

Respectfully,
Jim

SuperManny · Aug 25, 2011 - 8:34pm
Richard Booze wrote:
KC, I have had excellent experience with Gainesville Coins -- diversity of stock, good prices, quick shipment. 

Sounds like what we may "have here is a failure to communicate".

I agree completely, I've dealt with them in the past, and always had a good experience. My last order the credit card I was using wouldn't go through for some reason, (they ask for a small refundable deposit to lock in the price on big orders, even if you're wiring the funds). After a second credit card wouldn't go through, the guy says don't worry about it, I'll lock in the price for you anyways. I have always had good service, but I realize nobody's perfect...

I'd send back the coin and give them a chance to make it right, after all they're going on your word that they sent you a wrong coin. For all they know you may be trying to rip them off!! (Don't get me wrong, I'm not saying you are, but I'll bet it happens!)

bruinjoe93 · Aug 25, 2011 - 8:34pm

That's why they have a sell rating.

TruBlu11 · Aug 25, 2011 - 8:43pm

Anybody out there have the rather sudden thought that I had just now watching a Bloomberg interview on the $5B Buffet investment that maybe, just maybe, Buffet decided that his shareholders should follow his socialist bent lately (you know, the rich like him should pay more taxes speeches last week) and give money away for the good of the country? This is NOT Buffet's past careful investment style where he invests in solid existing management and a solid balance sheet. Far, far, faaaaaaaar from it. I was thinking earlier that he must be getting something for the investment (wink, wink, nod, nod) but I'm beginning to think that he is starting to believe his own press and actually likes to be known as the (humble) oracle of Omaha come to save the world and impart a kind gentleness upon all. What is this world coming to?

TruBlu11

TheGoodDoctor UncleFester · Aug 25, 2011 - 8:45pm

@UncleFester The major point of disagreement with you is the supply constraint. While the silver chart above says that 60% of yearly silver goes for industrial use I just don't see how you feel that the 8.3 times more gold than silver above ground with that heavy industrial use plus the surging investment/industrial use of silver in India and China is not bullish via a supply constraint on silver? I'll try and do a formula here.

Emerging Market Middle Class Population Growth Investment Demand + Emerging Market Industrial Revolution Demand > Yearly Mining Supply = Supply Constraint > Existing Mine Supply + New Mines Online = Silver Price Increase

In addition it is not only a currency crisis but a debt crisis. Not all currencies will fail or fail at the same time. So when the money flows to silver it will be to stronger hands to maintain wealth. You are right that there will be prices in which silver holders will sell, but we have seen a sell off with the most recent gold prices as well.

Demand could fall for industry but I don't think it will fall as you suggest. Not when all assets are inflating. Invariably, by suggesting that gold does not have any or little industrial usage you are suggesting that there is strong global demand for silver for industrial use proving my point about supply constraint.

You are suggesting deflation. If we are in a depression we still have seen silver go up in price. Many people are not buying things but yet silver goes up in price? This either suggests inflation or a supply constraint or both. If we end up in hyperinflation silver will be going up.

But once the currency is fixed, and the world will demand that it be fixed, the markets will resume and silver demand will revert back. Mr. Market puts metal where it is most useful, to maximize its utility. Silver's utility is industrial, gold's utility is in saving wealth.

IMHO it will revert back to what? The 16 to 1 ratio? Even at 40 to 1 if we get to Santa's number that is still $312.50 silver. So, even if we use that ratio and you buy 1000 oz of silver at $40 that is $40k. If you put the same amount of money into gold today you have 23 oz of gold (rounded up). Which would yield $287,500 at $12,500. For silver it would be $312,500. A net gain of $25k! Ok let's look at 16 to 1 = $781.25 x 1000 oz. = $781,250 or 10 to 1 = $1250 x 1000 oz. = $1,250,000. 1 to 1 = $12,500 x 1000 oz. = $12,500,000. I won't go into more than parity as you can see the numbers are exponential already. The gold gain remains the same at $287,500. That is not speculation in silver that is prudent investing. Got silver?

And as a side note. Just remember that this leverage is applicable to the miners as well. It costs on average $500 an ounce for gold and about $5 an ounce for silver to pull out of the ground. I'll take that leverage in silver miners any day of the week at 16 to 1, 10 to 1, or 1 to 1. Got miners?

I'll bet on 3 billion middle class Asians flush with cash from becoming middle class citizens.

TheGoodDoctor ewc58 · Aug 25, 2011 - 8:46pm

@ewc58 Now that is a Santa I can believe in! laugh

Shill · Aug 25, 2011 - 8:54pm

Seems to me the setup is clear and right in front of us, if we choose to look for it.

A: Margin hike yesterday.

B. Margin hike today

C. Ben speaks, and fails Wall streets wishes

People rush too treasuries and PM's, as well as mining shares.

Why have 2 back to back Margin hikes if you did not suspect a mad rush to safety? Oh and a complete collapse of the Euro states, ya that small problem as well.

Use this price correction to your advantage, I am not seeing the mad rush to the gates here folks, what I am seeing is buying on weakness.

Stay calm and vigilant let it come to you

Be well

( PS. FEED THE TURD )

SilverLeaf · Aug 25, 2011 - 8:54pm

Took a trip to my local coin store to buy some physical today, and couldn't help but observe the steady transformation that's occurred over the past six months. I remember going in when silver dropped from $30 to $26 in February and seeing the glass cases loaded to the gills with silver. The guy behind the counter was lamenting that people were panicking throughout the decline and unloaded a ton of silver that he had to buy.

Fast forward six months after silver drops from $43 to $39. Over the summer, they installed a "please take a number" dispenser to deal with the growing volume of customers that come in daily. Today wasn't manic, though there were about 6 people ahead of me in line. The bullion cases are nearly empty, with only a small assortment of tired silver coins and bars, and only a handful of gold coins left. And this is a big, big store!

I ask the guy at the counter if people had been unloading a lot of silver and gold the past few days. He said it was fairly steady, but that for every seller, there seemed to be more than one buyer, and their store's inventory had been nearly depleted during the dip.

I marveled at the amount of silver and gold that must be disappearing into strong private hands on every one of these manufactured EE dips. They're slitting their own wrists every time they do this...eventually, they're going to bleed out and die. Couldn't happen to a more deserving band of morally corrupt scumbags. FUCME and FUBM! Keep stacking!

------------------------------------------------------------------------------------------------------------------------------------

"Speaking the truth in times of universal deceit is a revolutionary act." - George Orwell.

Eric Original · Aug 25, 2011 - 9:02pm

The Walgreens website seems to be restocked on those hams, and still on sale. That's all I'm sayin...

https://www.walgreens.com/store/c/celebrity-boneless-cook-ham-with-natur...
Tesla · Aug 25, 2011 - 9:06pm

https://www.cmegroup.com/trading/metals/precious/silver_quotes_settlements_futures.html

https://www.cmegroup.com/trading/metals/precious/gold_quotes_settlements_futures.html

Compare todays #s to yesterdays #s for totals (keep in mind the numbers published today are from prior days session..8/24) 

porkyp · Aug 25, 2011 - 9:07pm

The HK Merc have not raised their margins for a 2nd time like CME or Shanghai, just shows you that an exchange like the CME which acts as the marketplace and Clearing House for its products can manipulate margins. HK Merc outsources its Clearing House to LCH London which does not run a market place which is independant and judges margins on true market risk/volatility.

Dr Durden · Aug 25, 2011 - 9:08pm

Gold is not longer the most speculative force in the Universe. Not by a long shot....

THE FED IS!

Why put so much energy into a proven narcoleptic, quiver-liped puppet liar? 

They're just sitting back laughing while the world shifts it's undies in it's crack in anticipation of the Gospel.

I fully realize the implications of every babbling syllable that falls out of his mouth, but come on! They guy is an empty suit.

Go rub your Eagles if you need to burn off some energy. Then read a bit of the Tao - it's all about finding the middle way.

See you on the other side...

gazkaz · Aug 25, 2011 - 9:15pm

1) As part of the deal Buffet got a pile of "options" -he made a BILLION+ today on those (so not a bad day at the office)

2) The main culprits of the Mortgage Backed Securites alleged fraud - were trying to settle a deal for a combined tap on the wrist for just over 100bn fine - (between them).

3) In the deal they get carte blanche, accross the board, get out of jail free, amnesty for any, and all, future misdemeanors that may come to light. (potential hundreds of billions in law suits)

4) Obstacle - the New York Attorney General

5) Reason - he was trying to up the ante of the tap on the wrist fine to a few hundred billion.

6) Obama literally just taken the NY Attorney General out the decision making process

7) Biggest alleged culprit re the MBS - countrywide. Who took them over B of A

8) Result the deal is now pretty much nailed on.

9) B of A pays it's tiny share of the tap on the wrist, and gets its - amnesty against future claims

10) Effect on share price when deal announced, and B of A are off the hook for the cost of just a few Billion ?

11) As I say a Gift to Buffet

12) In return ??

13) Buffet organising a fund raiser for Obama - Just $38,000 a plate.

14) And if anybody takes over B of A (eg JPM) - Buffet gets an instant 5% premium on the shares for any early settlement on the shares

Watch it roll out & Buffet trouser the GIFT

donnojackshit · Aug 25, 2011 - 9:17pm

A nice wholesome number. Wonder if this will make the Lame Stream News?

ginger · Aug 25, 2011 - 9:18pm

Eric ...lol.. ...'ham-pede'

....Also.. ...I need more sleep.. ...I saw Shill's post right after yours, Eric, and for a second my mind read it as think-buffett-investment-in-bac ....as BACON ....l.o.l.

Well.. ..it *was* right after your bacon post and .....I am tired.

heehee.

Eric Original · Aug 25, 2011 - 9:23pm

Ginger,

I stole "ham-pede" from Save-America1st. Sorry buddy!

Anyway (whispering) let's keep this whole ham thing quiet this time. Just between you and me......

ginger · Aug 25, 2011 - 9:26pm

Keep what quiet?

Smiley Shhhh....

:)

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