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

About the Author

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turd [at] tfmetalsreport [dot] com ()

  392 Comments

stoneeh
Aug 26, 2011 - 6:56am

Bohemian

Then take your money out. If you're an Austrian citizen then you're covered (up to 20000€ I believe?) by state insurance. No worries.

Bohemian stoneeh
Aug 26, 2011 - 7:25am

@stoneeh

I think you're missing one zero, right? 200,000 Euro... I don't know. They have branches in many countries. I am Bohemian, 1 hour from Austria, 35 min from Bavaria, 15 hours from Los Angeles. :-) We're covered up to 100,000 Euro per one person, one account.

Shill
Aug 26, 2011 - 7:34am

Morning Turd-Town, I see the

Morning Turd-Town, I see the great Gold crash / Bubble is closing in on $1800 lol

Screw You CNBC

Miners look great in the futures long and strong.

Shill
Aug 26, 2011 - 7:43am
Silver is money
Aug 26, 2011 - 7:47am

WYO Silver - Hugo salinas Price

Please take the time to read this speech that he gave in London so that you can better understand his angle on the 'monetization' of silver. There will never be a monetary value printed on the coins, that is an incorrect assessment of how he is pushing this. He knows that he could never achieve it and the price fluctuations within the silver spot market worldwide would make the values counterproductive to the process.

https://www.plata.com.mx/mplata/documentos/images/Hugo_Salinas_Price_Lon...

Silver is money Shill
Aug 26, 2011 - 7:49am

Shill - $1800

Personally, I have $1809 at the top for this bounce, followed by further correction. If we manage to hold strongly above that line then I will reconsider my take on things.

FYI, my silver number is $41.43.

Orange
Aug 26, 2011 - 7:54am

German Market

Just heard that the German market is down 24% in one month. I wonder if this will have any influence on other markets.

Dave T
Aug 26, 2011 - 7:54am

Decency

Someone places a post here that has nothing more than the “F” word for the title and that post gets over 20 hat tips. To me there’s something wrong with that. Would you all want your kids coming here to try to get a fiscal education? I’m not for censorship, but I am for decency. Anyone who’s OK with your kids reading that kind of stuff please let me know. I want to make sure my kids don’t hang around with your kids.

GoldMania3000
Aug 26, 2011 - 7:54am

Interesting Suze orman says

Just saw her on NBC. Hey she's not bad. talking about gold and says next level of gold $2100. and that everyone should own at least 5-15%. Also indicated that now is a good entry point. The important point to this is that main stream news infuses a posistive point to gold. This helps build the momemtum. I remember Doug Casey said when you see gold on Slime...and mainstream that will be the sign that the bull market is upon us.

stoneeh
Aug 26, 2011 - 8:00am

Re: Greek 2 year bond

Where do I buy one? ;)

Tom L
Aug 26, 2011 - 8:04am

@Shill

DrC is leading the way again this morning at $4.12, pushing up through $4.09 resistance a couple of hours ago. That bodes well for the miners this morning as well as Gold.

Looking at Gold an hourly close above $1810 would complete a 50% Fib Retracement. I expect resistance there to be stiffer. The bottom may well be in, but we could very easily start a new trading range between $1700 and $1850. While I sympathize with the perspective that the EE wants to smash Gold to retain power, I have to disagree. Their goal is a managed retreat on gold while they debase the dollar. Letting Gold get away from them not only cost them money in the short term it cost them something more precious than digits... prestige.

And b/c of that I can't believe, unless there is complete coordination between the whole G20, a move to $1500 is likely in light of recent events. Chavez is the front man for a power play between the US and the BRIC nations over the slice of the new reserve currency pie.

Higher gold prices keeps China and Russia under pressure to increase reserves while the supply is tight and increases the reserve value of the US and the Euro-zone who have the most goal.

Remember, IMF SDR's are the new reserve currency. The question to be resolved is what % of the reserves backing the SDR's will each country national currency represent. That is the point of all of Rickards' talk about their plan and the coming currency wars.

I've got more coming into my head about this but I'm stopping here. Morning chores and coffee need my attention.

Ta,

ewc58
Aug 26, 2011 - 8:07am

Get ready for a good day troops

Sure glad I busted a move on those calls yesterday. Here's the new Hyper Report to help you wake up. If you can follow it, you're well on your way toward a proper level of caffein-ation. If not, get another cuppa...

Video unavailable
Shill
Aug 26, 2011 - 8:10am

Hoenig: America your on your own

Hoenig Says U.S. Should Focus on Fixing Finances

https://www.bloomberg.com/news/2011-08-25/hoenig-says-fed-should-focus-on-fixing-u-s-finances-instead-of-economy.html

“We can’t do it all,” Hoenig, the central bank’s longest- serving policy maker, said in an interview with Bloomberg Television that airs today. “We have a problem in this country with debt” and “if we don’t turn to the long run, we will be dealing with overnight crises for as far as the eye can see.

junoroland
Aug 26, 2011 - 8:16am

back to the real problem

i cant wait for this jackson hole nonsense to be over. while it may have some short term effect on market prices its not the real motivating story behind golds rise. the price targets for gold are based on the debt that already exists, more QE will just add even more debt therefor longterm just increase the gold target. if you are paper trading its been a rocky week and you needed to be nimble but if you are "stacking" its not even a blip.

So as soon as MSM can deleverage itself from Jackson hole the better. Sitting here in the Irish Debt Gulag I can tell you the real reasons for holding metal is taking a massive turn. You've seen the Greek 2year interest rates? That deal is dead and the EU is on holidays. Buy metal. We 've had the most austere 3 years ever in this country and yesterday the IMF toika junta said we have to find another 10 billion in cuts. there is nothing left to cut apart from front line services.

I received a record 3 calls from friends this week who had not metal protection pondering if the 120 euro decline over two days was a good opportunity to buy. More disappointingly i got 2 calls from people i had convinced to go into gold about 3 years ago frantic to sell?!?!? They decided to hold when i said i could line up buyers that would beat any sell quote they would get from a dealer right now.

one more thing on the EU front. Merkyl is screwed. she has run her party based on sentiment reports before and after her decisions. she has presented us with this notion that the germans (and many other EU states, Finland) dont want to bail out lazy EU countries . this is not true . my friends in Berlin tell me that the germans completely understand they are not bailing any of these countries but their banks. The reason why the DAX really fell off yesterday was that Merkyls mentor / hero publicly castigated her for her policy yesterday. the person she models herself off told her she had it all wrong! elections in september should be fun!

uptrending regards from the Dublin Gulag

Tom L
Aug 26, 2011 - 8:18am

Pre-Comex smackdown

commencing. Gold, Silver, Copper and Crude all under pressure.

Going to be a tense 20 minutes.

Ta,

Shill
Aug 26, 2011 - 8:20am

Greek Banks' Liquidity Is

Greek Banks' Liquidity Is Suffering - WSJ.com

Another Reason to Own Gold (that I never thought of before)
A Greek retiree withdrew his savings from bank, stashed the paper money in his brick wall. Rats devoured it. HT: EPJ

Shill
Aug 26, 2011 - 8:24am

Tom look at the very well

Tom look at the very well coordinated hit.

https://www.marketwatch.com/investing/fund/gdx

Nothing obvious here nope, not a thing lol

This tells me the GDP numbers suck big time?

ewc58
Aug 26, 2011 - 8:26am
Tom L
Aug 26, 2011 - 8:31am

@shill

NO man, there's no way there's any market manipulation, Jeff Christian and John Nadler told me so.

/sarcasm

On a brighter note I just figured out that my constant stream of twitter-bait caused Mr. Evil Shill of the Evil Empire Himself Nouriel Roubini has blocked me.

That's something to wear proudly there.

Ta,

ScottJ
Aug 26, 2011 - 8:40am

Early morning thoughts

Copper keeps rising.... good indicator for PMs coming.

-

Rick Santelli is in the CNBC studio today. Should be interesting to hear him rant.

-

Why is Jackson Hole in Wyoming??? Odd place for a bunch of bankers to meet....

Shill
Aug 26, 2011 - 8:41am

8:30aU.S. second quarter GDP

  1. 8:30a

    U.S. second quarter GDP revised lower to 1.0%

  2. 8:30a

    Lower export growth, inventories account for drop

  3. 8:30a

    Exports rise 3.1%; inventories total $40.6 billion

Ouch!

Wow nasty revision to Q2 GDP.

The increase in exports was lowered to 3.1% from 6.0%

Good thing we've destroyed the currency to boost exports.

1% growth
0% interest rates
9% unemployment

Hows that Hope and Change working for you?

sevin
Aug 26, 2011 - 8:43am

@Shill

Thanks for being so on top of all the breaking economic data reports. Now we don't have to tune to CNBS to get the info, we can get it from you with your commentary! Thanks!

¤
Aug 26, 2011 - 8:44am

SVM share buy back just released

press release

Aug. 26, 2011, 8:01 a.m. EDT

Silvercorp Metals Inc.: Update on Normal Course Issuer Bid

VANCOUVER, BRITISH COLUMBIA, Aug 26, 2011 (MARKETWIRE via COMTEX) -- Silvercorp Metals Inc. /quotes/zigman/33670 CA:SVM -2.12% /quotes/zigman/33653/quotes/nls/svm SVM -1.60% ("Silvercorp" or the "Company") announces that to date, pursuant to its normal course issuer bid ("NCIB") announced on June 17, 2011, it has acquired a total of 1,624,233 of its common shares at an average price of CDN$8.18.

The Company is purchasing its own shares because it believes that prevailing market conditions have resulted in Silvercorp's shares being undervalued relative to the immediate and long term value of Silvercorp's portfolio of producing and development properties in China and Canada. The Company notes that the short interest position in its common shares has climbed from 3.6 million as of July 29, 2011 settlement date to 9.6 million as of August 15, 2011 settlement date, the most recent date for which short interest data is known by the Company. Under the existing NCIB the Company intends to acquire up to 10 million common shares. All common shares purchased under the NCIB will be cancelled.

About Silvercorp Metals Inc.

Silvercorp Metals Inc. is engaged in the acquisition, exploration, development and mining of high-grade silver-related mineral properties in China and Canada. Silvercorp is the largest primary silver producer in China through the operation of the four silver-lead-zinc mines at the Ying Mining Camp in the Henan Province of China. The Company is developing its GC silver-lead-zinc mine in the Guangdong Province and recently acquired the BYP gold-lead-zinc mine in Hunan province. In Canada, Silvercorp is preparing to apply for a Small Mine Permit for the Silvertip high grade silver-lead-zinc mine project in northern British Columbia to provide a further platform for growth and geographic diversification. The Company's shares are traded on the New York Stock Exchange and Toronto Stock Exchange and are included as a component of the S&P/TSX Composite and the S&P/TSX Global Mining Indexes.

¤
Aug 26, 2011 - 8:45am

Tom L

I know you've been following SVM pretty closely also.

This has to help out the share price going forward....you would think.

Hell of a lot better then issuing new shares. Fingers crossed here.

Jimbio
Aug 26, 2011 - 8:52am

SVM. How can that be anything

SVM. How can that be anything other than bullish? SVM has bought 1.6M shares at an average of 8.18, and intends to buy 8.4 million more?!

Sure, SVM might play it cool and buy them back lower, but this must mean a bottom is really really close.

The only thing that concerns me is that why would they tell us? If they wanted to get the shares as cheap as possible, wouldn't that announcement be counter-productive? ... Unless they know we will consider this! Ow my head.

¤
Aug 26, 2011 - 8:53am

Since 1978, Kansas City Fed has held an annual Federal Reserve

Since 1978, the Kansas City Fed has held an annual Federal Reserve symposium in Jackson Hole, Wyoming. From 1978 to 1981 the symposia focused on agricultural economic issues. Since 1981 topics have been more broad and the symposia have gotten broader attention.[7] In 2003 and 2005, papers were presented at the symposium that were critical of the status quo, and predicted, for example, problems with the unseen risks of derivatives. These ideas in these papers were rejected at the time, but later were seen as having predicted the financial crisis of 2007-2010

https://en.wikipedia.org/wiki/Jackson_Hole_Economic_Symposium#Economic_Symposium

Silver2500
Aug 26, 2011 - 8:57am

Guys, where can I watch

Guys, where can I watch Chairsatan's speech online???

¤
Aug 26, 2011 - 8:59am

Question about shorting stocks?

Take SVM for example. If your a short and you've been shorting SVM recently or for awhile, what implications does this buyback pose to you as a big short?

Doesn't sound good at all.

What might happen or would run through your mind in such a scenario? Would it be sell your positions off asap or short feven urther like the EE does to the miners?

Not knowing anything about shorting stocks and the strategies involved it seems like you would sell and cut your losses asap.

Tom L
Aug 26, 2011 - 9:03am

@DPH: SVM

Thanks man, greatly appreciated. H/T's all around, of course.

This is a perfect time to be accumulating SVM. I keep coming back to Sept OI numbers. There are 25K calls at $9+ currently underwater and 25K puts at $9+ that are in the money. That is keeping the stock down. Oct OI numbers are miniscule compared to this. Now if this is the effect of the announced share buyback well then SVM's management just played the shorts perfectly by buying near this bottom.

If you have cash I would accumulate Dec/Jan calls at $10-13. Fortunes to be made in this one stock alone (as long as their mines aren't nationalized by the Chinese Gov't).

Ta,

Dakini Silver2500
Aug 26, 2011 - 9:07am

To watch CNBC Live ~

Thanks for the ? Silver2500.

Here's a link for watching live news streams on-line - https://www.rentadrone.org/

Don't know if this will be carried live on CNBC or not? So I would like to know where we we can watch Bernanke speak as well.

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