Not much good news to report today but, of course, this is no surprise as we remain on the sidelines, waiting for the CoT to completely rinse out and the disinflation bias to abate.
It got pretty ugly in copper overnight as price fell all the way to 2.066. As we've been stating, once copper broke the August 24 intraday lows of 2.20, it was just a matter of time until it threatened 2.00 and now, here we are. Though copper has since rebounded to last of 2.11, this does little to change the overall picture. And, so long as paper copper threatens a complete washout, paper silver (and gold) will remain under pressure.
"Under pressure" would be a good way to describe our precious metals this morning as both are finally threatening to run the sell stops below the lows of last summer. I've got lasts of 75 and .17 so it won't take much of a shove for The Forces of Darkness to make this happen. Frankly, whether or not this happens today is irrelevant...this is going to happen. It's only a matter of time. As we finally found out yesterday, yes the CoT structure is dramatically improving. However, it still has a ways to go, particularly in silver. How will The Banks engender enough new selling to completely rinse The Specs back out? By maneuvering price to new lows and running the stops. Again, this is seemingly just a matter of time now.
And I thought this was cute...Bloomberg chimes in on how silver had declined for a "record losing streak", the worst since 1950. Of course, no mention is made that as of late October, when the "losing streak" began, the Silver Commercial NET SHORT position had soared to nearly 70,000 contracts, the highest since early 2008. No way that the esteemed reporters at Bloomberg were going to be astute enough to decipher this clear CAUSE AND EFFECT. What a scam this all is. https://www.bloomberg.com/news/articles/2015-11-17/gold-holds-drop-as-in...
So, here we are. Madness is full view all around the globe. The French seem ready to get full involved in Syria while Russia has announced that it was definitely a bomb that brought down that jet two weeks ago. The global economy is in shambles and the US barely sputters, with "growth" only possible due to double seasonal adjustments and other statistical gamesmanship. By the way, have you seen the Baltic Dry Index lately? It's nearly back to multi-year lows. Nothing says a booming global economy like collapsing shipping demand!
And don't forget about your friends at Glencore. Back to unchanged on the day but still in serious trouble below 90.
DoucheBank still looks terrible, too:
So don't let today's follow-on, nonsense rally in the S&P deceive you. The index is pressing right up against its 200-day MA at 2064 and I suspect that's about the limit of the central bank pumping. I could be wrong, of course, so watch the close to see where it ends up.
OK, that's it for now. Let's see what the rest of the day brings and then sum it all up with a podcast later.
TF
