More Downside Ahead?

Tue, Oct 4, 2011 - 4:01pm

Wow, this is really getting ugly. Metals down. Miners down. Yuck. Can it get worse? You bet it can. How much? I guess that depends upon whether or not this is "IT".

Gold 1596. Silver 28 and change. ABX 43. EXK 7.60. SLW 25.97. YIKES! DOUBLE YIKES!! But there is currently a pretty significant rally taking place in the stock market so maybe all is well. OK, probably not. It's more likely just The Fed painting the tape through the intercession of their primary dealers.

Here are your updated PM charts. This latest selloff has made their nascent recoveries look tenuous, at best. Both appear poised for a mid-week test of last weeks lows.


Having fallen this far, it's hard for me to believe that the metals won't test their respective long-term trendlines before they are done. Here are re-prints of the weekly charts I posted back on Sunday.


And here is a 5-year chart of the HUI. The 480 area has often acted as support but it wouldn't surprise me to see this index fall all the way to 450. Of course, if the U.S. stock market collapses this month like it did 3 years ago, it ain't gonna stop there so, if you own the miners, you should stay very cautious.


And this, from ZH, offers about the best advice available right now:

Now, go forth and prepare. We may be on the verge of the great collapse that so many of us have been expecting. We might also not be. Maybe the proverbial "can" can get kicked a bit further down the road once again.

Who can say for sure?

If we aren't on the verge, we should consider ourselves blessed for having additional time to prepare.

If we are on the verge, God help us all. TF

About the Author

turd [at] tfmetalsreport [dot] com ()
Does Feb19 Comex gold close above $1250 on Friday?
Total votes: 191


¤ · Oct 4, 2011 - 7:09pm
¤ · Oct 4, 2011 - 7:12pm
Be Prepared · Oct 4, 2011 - 7:14pm


It's sad to think that was done at least 40 to 100 years ago..... but it still just as relevant today. The underlying premise certainly hasn't changed much..... except the gouging of the American Public has increased in intensity and ferocity.

2turdledoves · Oct 4, 2011 - 7:15pm

Wow, I hit the target.

Regarding the S&P Breakdown. I wrote this on the 3rd:

"If this doesn't hold (1100) its Bye Bye. Next support at 1076. (Watch for the PPT to step in)"

Sorry to tute my own horn, I am just extremely surprised it happened exactly as predicted. Too bad I didn't take profits at 1076!

¤ · Oct 4, 2011 - 7:18pm
ScottJ · Oct 4, 2011 - 7:20pm

Excuse me, Scott...

...but I must chime in here.

I am short term neutral-to-bearish because:

1) I don't think The Cartel is finished covering shorts yet so I expect more downside.

2) The charts look like shit.

WHEN I feel The Cartel is done and WHEN I feel that the charts have found a solid bottom, I will alert everyone.

p.s. I think Matt Damon is a first class delta bravo. I like a lot of his movies, though.wink

¤ · Oct 4, 2011 - 7:21pm

The more things change, the more they stay the same

 DPH: I think that says 1934 Chicago tribune

Jack · Oct 4, 2011 - 7:26pm

World Collapse in 3 minutes

For those that haven't yet seen this, it can be used to explain Europe to our friends that wonder what we are doing all day on TF Metals Report. (That is if it can be done without busting a gut!). Enjoy and test your personality type with your response; does it make you laugh ...or... cry?

¤ · Oct 4, 2011 - 7:27pm

Time for a little Mr. Mojo Risen

For those that didn't know this, Mr. Mojo Risen is Jim Morrison all scrambled up.

The Doors - LA Woman
¤ · Oct 4, 2011 - 7:28pm


If your around, throw out the name of a old tune you want to see and hear.

It is your website after all. Thanks for everything.

Shill · Oct 4, 2011 - 7:31pm

Evening Turds.. Hell of a

Evening Turds..

Hell of a close today, these stretch marks on my Anus proves it.

¤ · Oct 4, 2011 - 7:34pm

Declaration Of Independence / read aloud

Declaration of Independence
cpnscarlet · Oct 4, 2011 - 7:36pm

So far - PM Silver Spike

So far we have just two stabs at why the float up on silver was so sharp this PM -

1) Asians have had it and are going to start early in the GLOBEX instead of HK open

2) No Rhyme or Reason - everyone is nuts/running scared - no logic


Bay of Pigs · Oct 4, 2011 - 7:36pm


John Embry - Silver is Completely Flushed out to the Downside

When asked about silver specifically, Embry stated, “I have a number of thoughts on this situation. First, I think the CFTC has sort of pushed off the ruling on the position limits for a few weeks to give the large bullion bank with the enormous short position more time to deal with it. Part of dealing with it involves getting the price down as low as possible and getting all of the speculators out.

The open interest in silver is back to what it was when silver was $7 to $10, you haven’t seen it this low for a long time. So this has been effective, they have gotten the paper speculators out.

My coin guy came over to see me yesterday and I asked him, ‘How’s your silver market these days?‘ He said, ‘I just got three boxes of maple leafs in or about 1,000 coins.‘ I asked him how they were selling and he said, ‘They are going out the window, all but 50 coins are gone.‘ I asked him what price he was selling them and he said, ‘$38 an ounce.‘ That’s with the paper price $30 to $31. So the smart guys know this is a rig job and they are getting their hands on what silver is available as fast as they can.”

Last Rebel ¤ · Oct 4, 2011 - 7:40pm

@DPH,Sweet. Doors were


Sweet. Doors were awesome. Thanks.

aurum argentum · Oct 4, 2011 - 7:41pm

Face it

The average guy can't win. As George Carlin said over a decade ago, the system is rigged. When it's in the banks and governments interest for gold and silver to rise, they will... until then, none of these experts know squat.... Agree or disagree. I'm vaklempt.

silvergoldsilver OC15 · Oct 4, 2011 - 7:44pm


how was that not a bloodbath?

ivars · Oct 4, 2011 - 7:44pm

EUR USD long term prediction chart


I have been staying up late since i felt I need to produce EUR/USD exchange ration prediction to understand better the default/devaluation ( Europe) debt deflation/default ( USA) sequence I have been looking at lately. Finally i got an idea how to do it- it may help also for other currencies, have no strength to continue now. It can be used also short term, e.g predicting that EUR will regain some ground=USD will weaken (till 1,40 +- 0,03) until the end of 2011- that is good for PM and commodities.

So here it is with few comments:

And here is the graph... i like it-if its totally wrong, it still looks logical, majestic piece of PAST pattern based charting ...

¤ · Oct 4, 2011 - 7:45pm

Judge Napolitano / a history lesson

The Judge on the Decline and Fall of Roman Empire and Future of America
· Oct 4, 2011 - 7:45pm

The Turd requests

"Cover of the Rolling Stone" by Dr. Hook.

apex101 · Oct 4, 2011 - 7:46pm

China looks like its going to

China looks like its going to implode any day now. Commodities could correct even further. Id be surprised if China makes it out of the year end without some type of crash. Gold might be OK but silver might get slaughtered.

¤ · Oct 4, 2011 - 7:47pm
· Oct 4, 2011 - 7:48pm


That was priceless! Sell everything! Man the writing is more than on the wall ...

Shill · Oct 4, 2011 - 7:52pm

My sense is we saw a

My sense is we saw a late-session short-covering rally today. Viable rallies rise in a purposeful give-and-take manner. This straight up stuff is the hallmark of shorts getting out of the way at any price, including the gamblin' hedgies. The near-term S&P trend remains down, the "live" p/e 17x and what may be an iffy Q3 earnings season in the balance.

ScottJ · Oct 4, 2011 - 7:54pm

@ CPN Scarlet

3) This market is completely algorithm controlled programmed with behavioral finance well intended.


I am a sucker for Matt Damon movies... have you ever seen Good Will Hunting?!?! laugh

I guess I had this coming after I criticized Bono... what comes around goes around, point well taken. cool

@ Turd

Sounds good, was just putting my views out there. Was not trying to undermine anyone, just putting my thoughts for others to contemplate. Thanks for your responding viewpoint. We will see how the charts look tomorrow.

¤ · Oct 4, 2011 - 7:54pm

Dow is up 400+ points from low on bank-led reversal

Oct. 4, 2011, 5:27 p.m. EDT

U.S. stocks rally in bank-led reversal

Losses vanish after report that EU plans to shore up banks

By kgibson[at]marketwatch[dot]com (Kate Gibson), MarketWatch

NEW YORK (MarketWatch) — U.S. stocks Tuesday made a swift, late-session rebound that drove the Dow industrials up more than 3% in the last 40 minutes of trading, after a report that European officials were moving toward a plan to recapitalize the region’s banks.

The final-hour rebound ensured the S&P 500 and Nasdaq Composite indexes stayed out of bear-market territory, a status they had flirted with during the session. It also inspired hope that markets were finding support after breaking through some key technical levels in the prior session.

Click to Play

The case against commodities

Dylan Grice, global strategist for Société Generale, explains why investing in commodities is a bet against innovation and why gold is an exception.

The S&P 500 Index /quotes/zigman/3870025 SPX +2.25% ended up 24.72 points, or 2.3%, to 1,123. 95. Financial stocks powered past the index’s nine other sectors, closing up 4.1%.

During the session, the S&P 500 had fallen at least 20% from its April 29 high of 1,363.61. A close at the lower, intraday levels would have been considered a bear market by many technical analysts.

The late turnaround, following the index’s break below its August lows of about 1,100 in Monday’s session, was a good sign, according to one stock watcher.

“The late-day rally — spurred on by the FT article discussing bank aid — took most of the market with it,”...

¤ · Oct 4, 2011 - 7:55pm

The least I can do....Enjoy!

Cover Of The Rolling Stone-Dr.Hook
Stormdancer · Oct 4, 2011 - 7:58pm

FWIW II - silver

26 Sep we got 11 1hr candles where the price remained below $30 for the full hour.

28 Sep 6 candles below $30

29 Sep 3 candles below $30

30 Sep 1 candle below $30

4 Oct 3 candles below $30 for the full hour

We ain't spent a great deal of time consistently below $30 since the 26th :)

CreditCrumbs · Oct 4, 2011 - 8:05pm

Hypothetical Question

I have a question to readers here. Has there been an instance in history when democracy survived under the stress of declining natural resources? Do you know any? These questions are out of my sincere curiosity. 

I am thinking that all democracies we have were formed during the last few hundreds of years occurred during the time where natural resources became more abundant, in particular energy (switching from wood to coal, and from coal to oil). Is this form of government strong enough to survive a sustained decline in energy availability? Has there been historical precedent? 

CreditCrumbs · Oct 4, 2011 - 8:06pm

Hypothetical Question

Sorry for the duplicate. Msg removed.

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