As we move at crawling speed towards the end of the current consolidation pattern, I am considering 3 main ideas: The first is calculating when the pattern will end. The second is recognising the signs which will confirm it's end via realtime observation. Third is the killer trade to exploit the answers to 1 and 2 above. I suspect that since metal swaps are at the base of price supression, an early diagnosis can be made from looking at the swap structure. This for bullion banks or their colleagues to sell the future and buy the spot. In so doing they exploit zero interest rates. That's because the ZIRP provided capital at xero cost to fund a carry trade over time. That is to say that state sponsored free money enables the price supression mechanism, and the end of extremely low cost carry trade capital will cause the end of precious metal price supression. Now I expect that interest rates will go negative before TPTB throw the towel into the PM ring. But that time is relatively close. It seems clear that the beginning of the next PM bull will be simultaneous with a rise in interest rates. Now if the Japanese screw with the JGB, (Kyle Bass post xmas interview) and manage to torpedo world bond markets, this will set a few big dominoes crashing against each other, and when it comes home to the dollar bonds they will start falling. But it doesn't have to be the Japanese that set it off. I do think however that bond yields are the key to the lock of our PM treasure box. So the 3rd question still stands. How to create the ultimate, non counterparty backed, non margined asymmetrical bet? Something like 1000:1 would be nice! Buying future deliveries of PMs for a small present day fee comes close. The streaming companies have it, but surely something else, or structure of other things, can be made to embody the same characteristics at a lower valuation? Ideas for THE BIG TRADE would be welcome, and also critiques of the reasoning above.
The setup for the big trade
(IMHO) It appears we are within the reversal/continuation pattern for the precious metals, and several other markets.
I suspect the silver low has been put in at end December, and the final low for Gold, which could have been early January, will come on the cyclical reversal of mid February.
Now every inflection point reflects the market has become finely balanced for an instant, so in a realistic analysis of the situation it must be accepted that MANY actors for TPTB are highly likely to initiate their diversionary tactics at that point, and whether they succeed for fail, the oncoming market reversal can change instead into a breakout. Either way there will be a big geopolitical mess and the market perceptions of that, whatever they be, is all that matters.
Last 3 days - Visible geopolitical footprints of TPTB's actors:
Israel jets attack Syria, Suicide bombing of US Embassy Ankara, North Korea declares state of Martial Law, 4th largest Dutch bank SNS Reaal NV collapses - first TBTF bank nationalization in 5 years
and the visible financial footprints of TPTB's actors in the markets:
We should be able to watch the usually invisible "grey men" and their paid stooges step out to do their stuff over the next couple of weeks.
Here is a little chart of what I have in mind:
You will notice this is the Euro cross, which is neutral, compared to the bullish dollar version at the moment, and the more bullish Sterling and Yen crosses.
The trendline out of the Feb inflection into 2013 can be at any angle, up, sideways, or even down, to be measured by the success or not of the interventions to come. The angle presented in the chart is my best guess based on events to date. I will quantify rallies and falls in March and adjust the chart based on the metal's performance.
Here is a glimpse into the next 5 days in the PMs.
The chart has red bars where volume is high. Blue where it is low. The black vertical lines are past forecast dates the price has now passed by, the coloured vertical lines are incoming event dates. Orange = minor = weekly swing; blue=bigger of size to form monthly high or low; red=financial earthquake of size to form annual high or low.
Minor reversal due Feb 7th.
The bigger reversal on Feb 11th will take the price towards a highly significant level the following week. At that point a major price event may occur.
Great care required!
Only in this thread. Soon to be on your charts.
Well the 7th has arrived and so have our colleagues, just in time.
Comex charts enclosed this time for stateside readers, though I use the Euro crosses mostly.
If I was taking an inkblot test I'd say it looks like a dog shaking a rat!
Maybe there are a few rats involved ..... .
See you on 11th Feb.
And what about this development:
Far too soon to consider the" print" relay race baton has changed hands already, but it might have gone to Draghi.
If it's still there after Feb 22 I'll give it more recognition.
It is make or break time. The opposing sides have run it to the wire, and a victor must emerge.
Therefore one side will have to cover their positions. Decisions are being made for a last titanic intervention which may save the day, and next week they will be arranged. This is to prevent entrenched naked shorts being overrun by longs.
Right now weaker naked shorts are squealing under the pressure, and fear of their survival if the bear squeeze succeeds. The stronger bankster shorts will be trying to get them to hang in a little longer right now. I expect margins and rules may get tinkered with. The new retail bulls that observed record coin sales and traded paper on margin now represent fresh meat to naked short sellers, but buy and hold forces increase the danger considerably.
This is being fought out not only in metals but also in stock indices where distribution to the public is probably incomplete, and the bag is still held by big market entities to a sufficient extent they don't like. It must be hard to want to collapse metals now, but at the same time want to keep stocks up for a little while longer when both are inflation hedge assets.
The actions in Japan have precipitated this, but they provided the fundamental trigger, at a cyclically appropriate time. The gold-euro chart above says that Japan have already stopped for the moment, (probably due a JPY bounce) and the EU has gotten it's turn to print next .
Cyclical Timing for next sequence of events:
The intervention pullback before this is the 11th - 12th Feb.
News events are prepared.
After 12th it is not safe without good stops all timezones all markets.
There may be a small timeframe breakout that begins on 14th. News releases begin to support whatever.
Resolution between 19th and 22nd. News goes mainstream. The weaker side (most likely retail) loses and covers, market accellerates against the losing side. This means it can be a breakout, or a reversal, but it's due at that time, and the situation after it is a clean slate - a fresh situation, a fresh direction, with fresh momentum.
Slight pauses and pullbacks arrive on 27 Feb.
Next swing: The metals and Nikkei 225 will be a whole new ballgame after this inflection has passed. Assuming the 19-22 Feb marks a selloff low, then the metals will rally up to a new high in mid March 2013.
My take: I closed phyzz silver longs yesterday, hold physical gold only now, go from 13-20 Feb long phyzz gold/flat-short paper silver, reverse to all long silver and gold 22 Feb or in a discernable selling climax. Fresh funds going to brokers this week to enlarge positions for the new campaign.
OK My head is now firmly placed upon the chopping block in so many different ways with this post. We can observe and/or trade the event and evaluate later.
All of the above (and all my posts in this thread) should be prefaced with the phrase "in my humble opinion", and being opinion is not investment advice. More money can be lost trading than was initially invested, do your own due diligence before trading, get the advice of a professional. These opinions are presented here for a demonstration of what cycles can do when used via an exact precise method, and for discussion purposes only.
Five minutes after posting the above ... I come across this:
Another cycle chart for gold.
The weekly highs and lows.
15 February and 3 May come up .....
These fit in with what many other methods are presently hinting at.
Remember ... cycles can swop highs into the place of lows at any time, (and vice versa) but their reversal dates tend to be respected whatever the market exercises it's choice to do.
Well today is Monday and here we are at the micro rally top right before the incoming selloff low. Tomorrow price might peep up a little higher, or may not. I expect the dog shaking procedure together with a nudge downwards from our friendly algo wielding colleagues. But they can only do this safely at certain moments, not any time, if they wish to keep their silk shirts. Today-tomorrow is such a (minor) moment.
I reduced my gold phyzz holdings by 70% today, so mostly out, flat, cash ready to go long into a proposed quarterly to annual low.
We are inside the predicted low's error tolerance period, so I will not watch it rise out of reach. However I DO expect some kind of vicious selloff this week to shake out more loose open interest and allow TPTB to stock up.
I am watching variations in volume at price carefully just now. So my proposed strategy for gold is to buy heavy on 19th Feb into a low, and maybe to buy heavy again on 21st Feb into some sort of failure to breakdown to new lows, or other low, if such should provide an opportunity.
The market may make me modify my strategy, but I am flexible and will not sit idly by and watch a rise after midweek this week without adding some longs.
The plan is to move excess of 100% long by Feb 22nd. Gold seems more bullish than silver just at the moment, and I expect the AU-AG ratio to widen somewhat in the first leg of the new bull if all goes to plan.
Sorry no charts ... proprietary stuff today ..... will provide some later in the week.
Now an interesting item for discussion right now is what fundamental news is being prepared to make the markets jump next week.
It may sound crazy, but I expect some or all of the following to tick a few boxes : invasion of a country, assassination or death of political leaders, corporate leadership resignation, rise of new parties, natural disaster events, mass public protest on the streets to demand political-social change, fall of a power. You know, the sort of random significant events the average person could never predict, and the markets will have to revalue prices violently when said information comes out ......... off the charts, ... soon to be on the charts!
To readers of this thread: Have fun this week!
Ooops ... should have mentioned that bank and broker failure are EXTREME for next week. And failed bond auctions will occur if any are held, so a bond auction may be pulled at the last minute.
And our colleagues have shown up at the appointed time .....
Chart basis the EUR cross.
This week I expect to see the trailing edge of consolidations begin to get very spiky as shorts become exposed, and "ticked into", before shoving it harder. So sign of this yet ....
The first big power change is in: http://www.bbc.co.uk/news/world-21411304
Pope Resigns. .... " corporate leadership resignation" (see post #9 above dated Feb 11th)
Announced today ... a minor turning date "Cyclical Timing for next sequence of events:The intervention pullback before this is the 11th - 12th Feb." (see post #5 above dd Feb 8th)
His resignation effective 28 February .... 24 hours from "27th Feb" another minor turning date (see post #5 above dd Feb 8th)
This is only the start of the coincidences.
Meanwhile the waterfall continues ....
10 minute Au-USD for stateside readers
We will see where tomorrow gets us, then the pressure should ease until closer to the big turning period next week.
I'm impressed. Wish I had bought gll and zsl on Friday as I had considered after reading your posts.
I'm impressed. Wish I had bought gll and zsl on Friday as I had considered after reading your posts.
Considered it myself, but we are close to the end of the time for shorts. Truly it can fall vertically as long as it is time for shorts, but the rally at the end will be a horrific bear squeeze to get caught up in.
I guess I'm admitting I chickened out!
Incoming pivot bars of significance basis the Gold-Euro daily chart
Highlighted bars are high volume = TPTB said hello. Timelines are shown for the past approx 45 days to give an idea how these things work.
... should be the same for Comex. No need to do a separate analysis, these days stick out a mile when they arrive.
The 14th Feb is really small, a ripple, not anything like the importance of the other Feb dates. (But you can't ignore it completely because the gf/other half will kill you! )
We are with 24 hours of 14th which may be the last inflection before 19th-21st Feb event. The gold and silver bounce off yesterday's lows looks fragile but is still intact ....today-tomorrow intraday looks like a micro bounce for the moment.
If EuroGold drops a couple of ticks through 1217, which it looks like doing soon, it is clear running to the low of May 2012 at 1203, the annual low I have been expecting and the purpose of this thread .
Given there is nothing to talk about yet in the price, lets have a look at some news:
Head Of Italy's Second Largest Industrial Conglomerate Arrested
Mario Draghi Speaks In Spanish Congress with Media Blackout
Remains found in California cabin after standoff with fugitive cop
The central bank of Russia host of this week's meeting of Group of 20 finance officials in Moscow, urged joint action to achieve balanced global growth and called on nations not to resort to trade protectionism and currency devaluations
A French court on Monday declared U.S. biotech giant Monsanto guilty of chemical poisoning of a French farmer, a judgment that could lend weight to other health claims against pesticides
Coronavirus: Signs the new Sars-like virus can spread between people
Cryosat Spots Arctic Sea Ice Loss
FM orders a review into the case of an Australian, mystery prisoner who reportedly hanged himself in 2010 in an Israeli jail
All I'm doing here is drawing attention to connections between items of power transfer which otherwise seem disconnected, except for their time synchrony.
We have 6 days to go, which is plenty of time for global geopolitical paranoia and power shift news releases to accelerate into a climax of public perception and revaluation of assets.
PS Only one reply so far to a lot of information which is way ahead of "normal" technical analysis.
I thought it might stimulate some opposition at the least. Though I accept that a desire by readers to wait and see more confirmations of unusually precise and ahead of event analysis is perfectly reasonable. I'll keep the monologue up until a week or two after the incoming major event, and if it doesn't interest folks at that stage let the thread drop down the list into the dust.
Keep it up bro, great reading!
This is in SLV but it's a nice clear view of the timing expectations which revolve about what the alternatives are if this works out as a double, or triple or single bottom.
The top is the cycle picture if the cycle works out as expected.
Under it is the analog I like to use, a more robust forecast, and it has been going quite well recently.
Both of them provide dates which are similar to but not precisely the same as the more accurate dates I've already posted in this thread . That's because cycles are less precise than other prop techniques, but when the cycles tell a very similar story, as they do now, it pays to notice that.
The first low is already in (31st Dec to 4 Jan depending on whether you look at gold or silver) .
The 19-21 Feb date is when I expect highest likelihood of the absolute low for this move.
The 27 Feb date is another inflection point ... it could be a lower low, but I am not counting on that. It could be a higher low, last chance to jump onboard. But this date could mark an attack into the price rise off of mid Feb. We have to wait and see from what direction price enters into this 27 Feb period to judge. And we expect another change when it gets there.
The mid March date is big, but I've got to get there first with my funds intact or preferably bigger than they are today. I have seen other analysts mention that they are watching "the Ides of March" too.
The analogs in my charts are time and direction specific only, they are not designed to give the slightest forecast of the magnitude of a swing. A tiny drop of an analog may match a massive vertical move of price, and that is ok with their intended purpose. Big moves are to be expected at the dates I have outlined.
The big picture is the metals are declining erratically towards the main target period, and other fallback periods are in place to exploit any opportunities arising or correct inadvertent errors made. Our ship to carry THE BIG TRADE is on course. That is the purpose of this thread - to meet it and get on board safely with as few trading errors in the process as possible.
Action required: a steady hand on the tiller.
This is a very big reversal (if it occurs) and an error of 3 daily bars either side (more likely prior) is acceptable for silver, 2 bars for gold.
Meanwhile intraday, the 14th Feb rally occurred on the 13th and is still hanging in there today 14th (am), really just an interruption in the down trend. It's spiking upwards just now as I type.
Today is the most suitable day for TPTB to act safely, and hit it, even if it is micro intervention that may not require much volume. They want it down on the weekly and monthly chart support lines to kill traders who bought at the lows during the past 18 months, and take their positions.
Still too soon to buy the dip in my humble opinion, but we are nearly there.
Bullion banks target could be 1625. It is potentially do-able in the brief time left. They will roll out a lot of traders if they get it there, but the TPTB will have to fight value buyers to do so. Life is not so easy for them as value buyers from Asia join the fray. Remember that as well as Bullion Banks, the politically motivated Central Banks also want traders PM assets, and this time they will aid the bullion banks to push it down. The bankster gangs will therefore merge to oppose us better.
I will wait and see.
With the proposed end of a short term rally, and the incoming (within a week) major low we should still see a sort of building-up process of a certain ... err ... tone or characteristic type ... of shall we say news releases.
Think in terms of: winner/loser emerges from conflict, clearance, victory, death, power swing crucial moment, euphoria and capitulation when evaluating these over each day this week.
So far we have:
Richter, Basquiat Top $127 million Auction at Christies .... “People are looking to buy art any cost,”
Berkshire Hathaway & 3G capital to Buy H J Heinz for $23 + Billion ....
Barrick Gold Takes $3 Billion Writedown on Copper Mine
Merck & Co. to Pay $688 Million to resolve two class-action lawsuits ...
Euro Recession deepened more than economists forecast with the worst performance in almost four years
Dubai Plans to trump New York's Bid for World's biggest Ferris Wheel
American Airlines & US Airways $11 Billion Merger
also - I apologize for omitting to mention in an earlier post the
North Korea Atomic Weapon Detonation
Now if anybody thinks we are getting average daily news items this week, I will not try to differ with them, as this is an admittedly subjective side to what I do, but just allow the rest of this week bring us whatever it will.
Banque Monte Paschi scandal Italy arrests, police seize Eur40 Million/$54 Million
Transocean Macondo Oil Spill, Guilty Plea to criminal charges accepted by US
Burmah police fired white phosphorus grenades at copper mine protesters
Business as usual ... no .... not this week IMHO. This is the week even Lloyd Blankfein types (including governments and corporations) will be "all in" and experience back-to-the-wall-against-opposition moments. Some will survive and some will fall. Watch their "Baghdad Bob" style PR emissions as it plays out.
I find the listing of exceptional headlines a bit of a bore, and so won't continue it to annoy everybody and clog up the thread with incidental details. I expect readers by now have figured out what particular kind of headlines I consider worth taking note of, and which would be symptomatic of a major support level breakout/reversal. So from here on I'll only make reference to the really huge power play stories that the last few days will bring (or not bring, if I'm full of BS! ) and try to stick to the charts as much as possible.
TPTB are punctual (see above post #14 with chart dd Feb 12th).
The Doc says 90 million ounces of silver was dumped. http://www.silverdoctors.com/raid-90-million-ounces-of-paper-silver-dumped-to-smash-silver-towards-30/#more-21484
Nice that they picked a time I mentioned a couple of days ago.
It's hard not to begin acquiring into this, but we are not there yet. I'll try my best but feel (!) like nibbling.
Amazing stuff, I am impressed. Been trading along time, I just read through your entire thread, it is a shame you have not gotten more replies! You may seem a little out there to some but I think I just read someone of experience and of great intelligence!
I can't hold it any longer
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