In The Woods

312
Thu, Sep 8, 2011 - 9:25am

The overnight action is the PMs is certainly encouraging and it would seem as though the half-life of central bank gold intervention is now about as long as central bank currency intervention. We all know, however, that it is still too soon to let our guards down. The quick recovery in price may only serve to embolden our increasingly desperate adversary, so, much caution is still warranted.

That said, I do not want to minimize the importance of the overnight reaction in price. The SNB attack of early yesterday sent the metals markets reeling. The attacks were timed to have a spillover effect onto the Comex and December gold traded as low as $1794 by mid-morning. In the old days, this would have sent gold into a tailspin as weak-handed longs began to race each other for the exits. They knew they were no match for the central banks and The Cartel.

Note, though, how yesterday was different. Once the Comex was closed, things began to improve almost immediately. Baby steps at first but then a full-blown rally overnight in Asia. Our longs are no longer weak-handed. They are resolute. They are buyers of size and they seem to pounce on discounted prices. This must be very discouraging to The Cartel. They are trapped in an untenable short position and they are being forced to cover at increasingly higher prices. HAHAHA!

To that end, I feel I must state this again. Please be sure you are making note of which "analysts" and "traders" are calling a "bubble". One only needs a cursory understanding of the Commitment of Traders data to deduce that there is no such thing as the CoT data since early August has clearly shown that the primary driver of price to this level has been Cartel short-covering. A bubble presumes retail buying. Average, everyday investors rushing in to buy something. The greater fool theory in action. Think dot com. Think Las Vegas real estate. Cartel short-covering does not create a bubble. As stated ad nauseam, the weekly CoT report is a very important, fundamental statistic. Any serious metals analyst knows this. Accordingly, any serious metals analyst knows that gold is not a bubble. The boneheads calling gold a bubble are, therefore, not serious analysts and should be ignored. Do not forget them, though, as they will most assuredly resurface in the future to once again proclaim an end to the gold bull. Remember who they are so that you can ignore them in the future, too.

The next question we need to ask is: Why are the banks so desperate to cover? Ponder that one for a while. I've got my thoughts on the subject. I'd be curious to hear yours.

Here are your charts for this morning. I see they are already becoming outdated as the metals have continued to rally while I type.

Remember today that my warning of yesterday was not to sell, it was not to buy. I stand by that. With the active central bank intervention of earlier this week, it is still too dangerous to be boldly buying with confidence. For now, I am simply holding my positions. The only trades I made yesterday were to re-cover my October gold calls. You may recall, I have been long October calls but, from time to time, I've been selling some calls against them (creating a spread) whenever I felt that risk was high. I've been taking the "short" side off and "opening up" my calls when I feel that risk is minimal. My current trading portfolio is as follows:

Long Oct 1900 gold calls vs short Oct 2000 gold calls

Long Dec 1900 gold calls vs short Dec 2200 gold calls

Long Dec 50 silver calls vs short Dec 60 silver calls

About 25% cash. Patiently waiting.

Lastly, I would be remiss if I didn't print the chart below. Several Turdites have sent it to me looking for my opinion and I feel it deserves your full consideration.

About the quickest way to go broke trading futures is to go around declaring that "this time is different". However, in this case, I feel this time truly is different.

This chart covers the previous 32 years of Keynesian central banker-dominated thinking. We are at the end of the Great Keynesian Experiment. The current system will not be continuing much longer. A new paradigm will soon be emerging. Therefore, while price will still correct from time to time, historical correlations such as this one are of minimal significance.

I've got lasts of 1862 and 42.42. It will be a very interesting day so try to keep an eye on things. More later. TF

About the Author

Founder
turd [at] tfmetalsreport [dot] com ()

  312 Comments

Tesla
Sep 8, 2011 - 2:44pm

Thanks Turd!

The SNB move was HUGE

BagOfGold Economical Disaster
Sep 8, 2011 - 2:46pm

Economical Disaster...

We have lots of gold!...Come to Canada...& I'll dig some up for you!...I find it all over the place!!!...

Bag Of Gold

margaritatime
Sep 8, 2011 - 2:46pm

Eco Disaster

Sorry, I disagree... That statement is parable to saying China has no gold reserves. Perhaps you should look in to Canada's philosophy of holding 'ore in the back' with it's principles in mining. [Federal Government Land acquisitions and Sensitive Lands reclamation projects that coincidentally included over 30 inactive Gold & Silver mines.] Canada has been amassing large amounts of gold reserves - albeit quietly. Don't believe everything you hear from the muppets.

Lord Koos
Sep 8, 2011 - 2:47pm

"German Politicians Want

"German Politicians Want Italy And Spain To Sell Their Gold"

Well that would work out really well for the EE as it would hammer down gold prices, hard. Hopefully these sovereign nations will not buckle under the pressure from their partners. Of course the USA would love to see them sell the gold as well.

jlee2027
Sep 8, 2011 - 2:51pm

Yahoo takes down Ron Paul debate poll winning

This article included a debate poll to vote for Last Night's GOP winner. Ron Paul was clearly ahead and Yahoo has now, apparently, removed the poll!!!

https://news.yahoo.com/now-know-perry-doesnt-debate-reason-143833846.html

Ah, a refresh and it's back up? Never mind...

murphy
Sep 8, 2011 - 2:51pm

Tom, Vet and Mikey

Thanks for all the input. I may post it all on Terri's option thread, it may help newbs like me. Thx again

exiledbear
Sep 8, 2011 - 2:52pm

Heh

The Gold OI decreased almost the same amount as that 7000 short position. That's what I figured, they can take the price down in the short run, but the market is now big enough to absorb shenanigans like that. I suspect (I don't know, but I suspect) that whoever holds those swiss gold contracts will want to take delivery. And whoever it is will walk away and not come back either, I imagine too.

Years ago, 7000 contracts would've destroyed the gold market. Now it's just a temporary setback.

stoneeh
Sep 8, 2011 - 2:52pm

Now would you look at that

Now would you look at that POS fly!

Tesla
Sep 8, 2011 - 2:54pm

@California Lawyer

I agree 100%

Jake
Sep 8, 2011 - 2:55pm

BREAKING NEWS: THE MANCHILD MAY HAVE TO POSTPONE HIS SPEECH

He Wrote his plan on a napkin from the clubhouse and it blew onto the green at the 18th hole: He's Got 4 Hours to Find it!

¤
Sep 8, 2011 - 2:57pm

The Blue Pill

You never disappoint.

~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~

More Bernank and the moment thoughts...

Maybe the Bernank was just "off' today and not feeling great. He's human (maybe) lol

What I think I saw, was a man who is under enormous pressure for "the answer" and it's getting to him. And he has none.

What I think I saw, was man who has come to grips with the future and he's read the writing on the wall and accepted it. He knows where this is headed and how close it is and how it unfolds.

If we see the same type of performance at the next meeting on Sept. 21/22 from him body language and speech/voice inflection wise, then it's confirmed imo.

We'll know if he is going through the motions because he'll telegraph it loud and clear. He appears to be a man who has come to grips with reality and his place in it. The pressure must be enormous. How could it not be?

That's what I think I saw in the man today.

Shill
Sep 8, 2011 - 3:00pm

As I noted the witching hour

As I noted the witching hour something will give, and it has...to the upside.

Go Get'em folks. A nice vertical climb into the close will give us a nice going into the weekend long parting gift lol

Economical Disaster
Sep 8, 2011 - 3:01pm

@margaritatime The Queen is the sole legal owner of all the land

You're completely wrong on that one. the Queen and the MONARCH own Canada and its land. Only 9.7% is privately owned. CANADA has NO gold, does not own any and mines it for foreign interests. I have studied CANADIAN mining for 30 yrs.

https://www.whoownstheworld.com/canada/

Tesla
Sep 8, 2011 - 3:02pm

Silver OI (-1,312 total contracts)

Daily Settlements for Silver Futures (PRELIMINARY)

Trade Date: 09/08/2011

Month

Open

High

Low

Last

Change

Settle

Estimated

Volume

Prior Day

Open Interest

SEP 11

41.520

42.620

41.520

-

+.907

42.479

232

873

OCT 11

41.450

42.635

41.450

-

+.899

42.491

288

362

NOV 11

42.060

42.475

42.060

-

+.900

42.512

21

15

DEC 11

41.655

42.725

41.285

-

+.899

42.530

29,771

76,866

JAN 12

41.765

42.485

41.765

-

+.904

42.553

40

188

MAR 12

41.605

42.530

41.605

-

+.904

42.558

1,184

7,943

MAY 12

-

-

-

-

+.910

42.564

27

2,498

JLY 12

-

42.260B

-

-

+.911

42.553

11

1,955

SEP 12

41.845

41.845

41.845

-

+.913

42.528

9

538

DEC 12

41.740

42.480

41.530

-

+.920

42.462

1,012

9,042

JAN 13

-

-

-

-

+.922

42.424

-

1

MAR 13

-

-

-

-

+.928

42.352

265

460

MAY 13

-

-

-

-

+.920

42.293

-

40

JLY 13

-

-

-

-

+.919

42.231

20

2,204

DEC 13

-

-

-

-

+.918

42.109

295

7,015

JLY 14

-

-

-

-

+.918

41.858

-

232

DEC 14

-

-

-

-

+.903

41.714

1

1,202

JLY 15

-

-

-

-

+.903

41.448

-

156

DEC 15

-

-

-

-

+.903

41.233

-

536

JLY 16

-

-

-

-

+.903

41.008

-

11

Total

33,176

112,137

Last Updated 09/08/2011 01:32 PM

graphs compliments: https://www.dailymarkets.com/commitment-of-traders/

margaritatime
Sep 8, 2011 - 3:02pm

right

EcoD; Again, I disagree. No hard feelings, but you might need to research that further friend.

Tesla
Sep 8, 2011 - 3:02pm

Gold OI (-6,162 total contracts)

Daily Settlements for Gold Futures (PRELIMINARY)

Trade Date: 09/08/2011

Month

Open

High

Low

Last

Change

Settle

Estimated

Volume

Prior Day

Open Interest

SEP 11

1839.3

1860.7

1835.0

-

+40.2

1854.4

70

549

OCT 11

1814.9

1866.0

1814.0

-

+40.3

1855.2

8,765

34,487

NOV 11

1838.4

1863.1

1829.8

-

+40.1

1856.3

98

65

DEC 11

1819.5

1868.7

1816.2

1857.2

+39.9

1857.5

187,553

345,479

FEB 12

1819.2

1870.0

1819.2

-

+39.9

1859.2

903

31,673

APR 12

1821.4

1867.3

1819.8

-

+39.9

1860.9

370

8,400

JUN 12

1843.8

1864.1

1837.5

-

+40.0

1862.9

280

17,040

AUG 12

1844.4

1867.1

1842.1

-

+40.0

1864.8

90

6,358

OCT 12

1855.0

1869.0

1842.2

-

+40.0

1866.7

39

4,305

DEC 12

1856.4

1877.3

1845.7

-

+40.1

1868.7

173

13,886

FEB 13

-

-

-

-

+40.1

1870.9

9

3,121

APR 13

-

-

-

-

+40.1

1873.0

-

333

JUN 13

-

-

-

-

+40.1

1875.4

155

12,273

DEC 13

-

-

-

-

+40.2

1886.1

188

12,831

JUN 14

-

-

-

-

+40.3

1898.6

25

4,801

DEC 14

-

-

-

-

+40.7

1913.1

-

10,381

JUN 15

-

-

-

-

+40.7

1932.1

5

5,207

DEC 15

-

-

-

-

+40.7

1953.3

285

4,667

JUN 16

-

-

-

-

+40.3

1975.7

-

26

DEC 16

1995.0

1995.0

1995.0

-

+39.9

2001.7

26

1,240

JUN 17

2029.0

2029.0

2029.0

-

+39.9

2033.0

1

10

Total

199,035

517,132

Last Updated 09/08/2011 01:32 PM

graphs compliments: https://www.dailymarkets.com/commitment-of-traders/

silver foil hat Timber Tim
Sep 8, 2011 - 3:04pm

@scottj... perry / paul pic

It's almost like the unpublished caption ends with "....like Lincoln and JFK"

(here's the pic again, for refresher)

Mikey Tesla
Sep 8, 2011 - 3:07pm

@Ca Lawyer, Assuming you are

@Ca Lawyer,

Assuming you are correct, which sounds darn feasible to me, wouldn't the Swiss cratering be right in line with the plan as China is largest dollar holder(besides us). Keep the buck stronger helps them out.

Shill
Sep 8, 2011 - 3:13pm

US Senate Starts Process For

US Senate Starts Process For 2nd Debt Ceiling Boost

$14.23T up to $14.62T and debt to the penny says: $14,717,757,015,045.83 today.

Folks, just buy Gold and STFU lol...


Sep 8, 2011 - 3:14pm

What Will it Be Like Under Eastern Power?

This to me is the area to concern one's self intellectually.

I try to think about opportunities starting at the point when the transition to Eastern power is half-way completed. I don't think it is wise to get too far ahead on this, because I have learned in my career to never underestimate the ruthlessness of a powerful interest that is about to lose power. It is best to be a safe distance away. The winners in all of these fights are not the ones doing battle with the ogres, but the winners are the ones who come in soon after the ogre dies, and restores order. See, the combatants have no interest in ruling, they only have interest in defeating the ogre. This is the warrior mentality. History has shown this time and time again.

So, for long term analysis, and survival, it pays to be the one watching the fight at a safe distance, and being prepared to swoop in at the opportune moment.

For example, here is one idea that I cannot let go of, and it haunts me daily.

China has no general aviation. This is because China'a airspace is under govt control, and there is no ability for small planes/helicopters to fly around, due to govt restrictions on airspace. But, what if China were to open up its low altitude airspace, like here in the US? To me, that would signal a HUGE, once in a lifetime opportunity, to immediately relocate to China and help them develop their general airspace industry. Think about infrastructure, like hard assets such as airports, fuel transportation, storage, navigation radio aids, etc. Think about regulations, development thereof, pilot training, maintenace training. Think about manufacturing of small general aviation aircraft. Think of the demand by the citizens for flight training. The list is just astonishing.

So, at what point do I gear up and launch on over there? Certainly not now, because the power shift transition is really just about 10-20% started.

But, are there similar opportunities here, in the US, for when the power shift moves past 50%? For example, would not the Chinese elites want to own stuff here in the US? Maybe setting up some sort of tourism agency now, to get the groundwork all done, is a good idea? Maybe optioning up a load of raw land, with the view that the Chinese will want to play golf on a massive scale, is a good play right now, since when the time comes, it will be a simple transaction to put in place a nice development deal. I mean, look at what the Chinese did in Idaho?

Anyhow, these are my nascent thoughts on this whole thing. They are truly nascent though, but I am always thinking.

¤
Sep 8, 2011 - 3:14pm

Turd (edit)

Read that ZH article after my initial Bernank post and my latest one.

I'm left with the same feeling as you after the article. That the Bernank looked and sounded like a man who "knows" exactly what's up and where were headed is troubling to me.

I didn't like the impression the speech left and it wasn't the content. jmho

edit: I can't help but think he may know something about MENA also.

FFF
Sep 8, 2011 - 3:18pm

SVM...

After hitting an intraday high of $9.23, SVM has pulled back to the $8.95 area. At what price would you guys feel comfortable in adding to your long stock position? Everytime I try to read a chart, I am WRONG!!

TIA

Las Vegas Dave
Sep 8, 2011 - 3:18pm

was the 7000 contract dump a fools errand?

a relic of the days when a drop like that into a thin market would have spooked the market for days/weeks?

And if it were a miscalculation, why wasnt it followed up with an increasingly larger short?

could the seller have possibly folded his hand and walked away?

A very mysterious and maybe futile gesture?

By far the most interesting trade of the last 30 days

Larry
Sep 8, 2011 - 3:20pm
Shill
Sep 8, 2011 - 3:21pm

Lawmakers seek 'conforming'

Lawmakers seek 'conforming' loan limit extension - MarketWatch

Butting heads with the Obama administration, a group of 37 lawmakers on Thursday called for a short-term extension of regulations that would allow the maximum size of loans that can be guaranteed by government controlled mortgage giants Fannie Mae and Freddie Mac remain at the current level of $729,750.

Cocaine is a helluva drug. We have reached peek screwed ness.

Economical Disaster
Sep 8, 2011 - 3:23pm

@margaritatime YOU better do some research

Can't be any clearer then that LINK!

All physical land in Canada is the property of the Crown, Queen Elisabeth 11. There is no provision in the Canada Act, or in the Constitution Act 1982 which amends it, for any Canadian to own any physical land in Canada. All that Canadians may hold, in conformity with medieval and feudal law, is “an interest in an estate in land in fee simple”. Land defined as ‘Crown land’ in Canada, and administered by the Federal Government and the Provinces, is merely land not ‘dedicated’ or assigned in freehold tenure. Freehold is tenure, not ownership. Freehold land is ‘held’ not ‘owned’.

Queen Elizabeth owns 2,467 million acres in Canada, 1,900 million acres in Australia, 114 million acres in Papua New Guinea, and 66 million acres in New Zealand.

The Latest Gold Fraud Bombshell: Canada's Only Bullion Bank Gold Vault Is Practically Empty

https://northerntruthseeker.blogspot.com/2010/04/ok-where-has-all-of-can...

Aronnax Economical Disaster
Sep 8, 2011 - 3:23pm

Canadian land ownership

See, this is yet another example of why coming to this site is worth it. Had no friggin' idea.

Would be interesting to know how many OTHER countries are set up with similar, deeply embedded restrictions? Much like the property taxes in the US, this makes land ownership at the will and whim of the British Crown?

https://www.bclaws.ca/EPLibraries/bclaws_new/document/ID/freeside/00_96245_01#section1

How are the 10-11% of privately owned lands 'private'? Are they any more 'private' than the Crown Grants?


Sep 8, 2011 - 3:24pm

@Mikey

That is exactly what I was thinking. Short term, the Chinese do not want to lose everything by their possession of dollars. Allowing CHF to be a safe haven flow, would have allowed the CHF to compete against the dollar for sure.

Look too at the AUD/USD cross, basically a double top at 1.09 on the daily chart. On the monthly chart, the peak seems to be in as the MACD is showing way overbought. I got in and shorted a little too early on Aug. 22,, 2011. But, I am very confident that the AUD craters as the world undergoes a slowing. My thinking goes like this: the Chinese are managing their own slowdown, and the risk-off commodity trade like the AUD, NZD, etc., will slow as well. This will drive the AUD down, so the Chinese do not want to tie their currency reserves up in falling currencies. In a risk-on scenario, like now, with the US tanking and all hell breaking loose in europe, the Chinese wanted to keep the dollar from falling faster than everything else. So, the Swiss are "encouraged" to devalue the CHF, and voila, there you have it.

I am going to ride the short AUD/USD to around parity, then bail, and then buy more physical. I hope I am right!

bensgone ScottJ
Sep 8, 2011 - 3:25pm

In response to Scottj's very interesting post.

Scottj said;

"The 7,000,000,000th human being will be born in 2011, each on his/her own individual cycle of life, with our own unique circumstances in which manifests our reality. For there is no inherit difference between any single human being on this planet, no matter how such an argument else-wise may be justified. Statistically there is no root difference between any man, woman, or child of any heritage, as each of us are a culmination of circumstances in which we cannot consciously decide. While we may differ in skin colors, languages, ethics, habits, beliefs, cultures, countries of origin, sufferings, injustices, struggles, luxuries, and overall environment, we all as individuals share a root common ancestry in which ties the human race together, better known as history."

Since philosophy has always been such an intense part of my intellectual interests and pursuits, I am compelled, therefore, to respond to your interesting post.

Fundamentally we all as human beings share this one primary attribute which separates us from all other living organisms on this planet, i.e the capacity to think are reason using concepts, ideas, symbols, or word. It is this faculty which gives us immense freedom and free will, potentially. We are also essentially beings with a soul and are spirits incarnate. Each of us is totally unique and there is no other person exactly the same as anyone of us, in all of the present and past humans that have existed in all of history. There are literally thousands of factors contributing to this uniqueness, some of which you mention above. We are not, nor need we be, victims of our circumstances. We can and frequently do rise above these powerful influences. It is these things that you mention that tie us together as groups of individuals. But, the real things that tie us together, are our belief systems, as expressed in our morals, religions, philosophies, and political persuasions.

Scott, with all due respect, you appear to be a fatalist/relativists, subjectivist. I think there are fundamental principles and axioms, or laws if you will, that determine how successful we will be as human beings. It is the power of these laws that that we accept or refuse to understand and obey that will determine whether we will be essentially right or wrong in our thinking and in the life we lead. Mankind is the sum total of all the history proceeding us. We are in our present state and condition, as a consequence. However, the future is determined not by our common past but by what we decide to do about the present situation, and what we think is possible to us as a specie and as individuals. Hopefully, we will identify our errors and mistakes and take steps to mitigate the consequences of the past, by doing the right thing in the future. Proper identification requires reason, logic, and critical thinking skills. Without these skills we are hopeless and helpless to overcome adversity and to make the necessary changes to secure a healthy prosperous future. It is not a matter of relativity therefore, but of actuality, rationality, and objectivity, regardless of how all things may be related.

I sincerely hope that this helps you and others to see more clearly our possibilities and choices as human beings. If I have misunderstood you in any way, I stand corrected and relish your response. Peace.

Vincent
Sep 8, 2011 - 3:26pm

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