As we once again await the Fedlines later today, here are some charts for our consideration.
First of all, it's great to see the metals rallying, especially after all the wailing and grinding of teeth over the weekend. On a personal note, it's always somewhat gratifying, too, when "Mr. Wrong 99% of The Time" actually gets one right. I hope that, by following along closely, you've had your stress limited.
What kills me today is the shock and surprise at the GDP numbers. Everyone (myself included) was saying in November and December that Q4 GDP would be down or negative due in large part to Hurricane Sandy. You simply don't slide a storm like that into NJ and NY and not see an economic impact. But, again, all of this was forgotten when The Forces of Darkness picked up the "6.5% inflation target" ball and ran with it back after the last FOMC meeting on 12/12. Whatever. I know it's hard to keep track of all this stuff...which is why I'm always begging you to simply btfd and keep stacking. The day-to-day noise can make you crazy and cause you to doubt yourself. Know that, long-term, physical gold and silver are your only solution and your only protection.
Regarding the Q4 GDP, here's the only news story you need to read and, from the article, the only chart you need to see. (Anyone got any bananas?) https://www.zerohedge.com/news/2013-01-30/us-ends-2012-1038-debt-gdp
The resultant rallies in the metals have carried gold to near its usual +1% cap and silver has not only breached $31.60, it has also now moved through its 50-day MA near $31.90. Very nice. Very nice, indeed. Now, can we just get a further spark to really get some short-covering going? Something from the Fedlines or the BLSBS? We'll see. For now in gold, keep an eye on significant chart and psychological resistance at/near 1700 as well as the Apr13 50-day near $1691. IF WE CAN GET A POP, the next challenge will be the 100-day MA, near 1720.
Silver is cooking, too, and there is plenty to be excited about. But, first, silver must still pass The Big Test. Can it burst higher, taking out last week's highs, chart resistance and its 100-day MA...all between $32.50 and $32.75? IF IT DOES, we can all begin to get excited. Until then...well, just try not to get too emotional about it.
That's all for now. Look for another thread later today, after the Fedlines.
TF
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3:00 PM EST UPDATE:
Rather than start a new post, I thought I'd just update this one. Besides, since there wasn't a rigged selloff post-Fedlines, all of the charts are still relevant.
The Bernank said nothing new and mainly just reiterated all that was said back in December. The only new item was a stated recognition that "economic activity had paused in recent months". I wonder how all those who foolishly cling to the belief that QE is related to economic activity will try to spin that one?
Squeaky (Bill Gross) said two interesting things during the CNBS coveage:
- That Fed policy has "distorted prices in all asset categories".
- That he agrees with The Fed that unemployment targets will not be reached until 2015, at the earliest.
And point #2 is the one that so infuriates me. You see, I watched The Bernank's press conference, post the Fedlines back in December. He clearly stated that the 6.5% unemployment number was only being given for "context" and "transparency" and that, since The Fed doesn't see unemployment dropping to 6.5% until 2015, they're essentially saying the same things as always. BUT, NO!! All the naysayers, boobs and monkeys picked it up and ran as if QE will be ending as soon as this autumn! What a freaking joke!! Again, these types of FACTS often get lost in all the day-to-day angst and stress over price swings. Just keep buying the freaking dip and all will be well.
Just a few other things. On page 3 of this thread I posted some charts of an ugly-looking Pig. It is rolling over badly and looks like it may soon violate critical support near 79. Let's remember to watch this closely over the next few days and weeks.
I also posted a chart of Sylvia Platinum. It is rallying back from another successful hold of 1660 support and looks poised to take another (#8) stab at $1700. I keep watching this because a successful breach of 1700 and rally beyond will, no doubt, add some spillover strength to gold and silver.
The 10-year is declining again today with yields reaching 2.03% right before the Fedlines were released. I received this chart by email earlier today and I liked it a lot. It's a chart of the price of gold divided by the price of the 10-year note. Pretty interesting.
Speaking of interesting charts...Paul Coghlan passed along a video showing how successfully his "forks" had helped position traders for the huge rally this morning. Again, I want to re-emphasize...If you're attempting to trade gold and silver without their assistance, you're crazy. I set this up for you for a reason and too few of you are taking advantage of it. Just look at Andy's numbers in the adbox on the right side of he page. And that's just trading one contract! Please don't waste any more of your hard-earned fiat attempting to out-fox the foxes. Join The Army. Survive and prosper. https://www.coghlancapital.com/node/5188
And I need to comment on the OI numbers. Even with the impending expiration/FND of the Feb13 contract, the gold OI numbers are astonishing. While gold was rallying $8 yesterday, the total OI declined by over 8000 contracts to 430,712. This is down an amazing 30,000+ in over a week! That level is the second-lowest for 2013, coming in just above the 428,747 seen on 1/4/13, just after the brutal 1/3-1/4 beatdown. With price $40 higher, that's a lot of paper being shifted from weak to strong hands.
Now get a load of this...The CoT survey was at the close yesterday. For the reporting week, gold fell $32 and its OI fell by 30,500 contracts. WOW! But check out silver. For the week, price fell by exactly $1 but the total silver OI rose by 6,000! Talk about fuel for a short squeeze! Needless to say, this week's CoT, once it's finally released on Friday, is going to be interesting. Very interesting, indeed.
OK, that's it for today. As I close, I see that The Monkeys and algos have decided to hit the metals on The Globex anyway, regardless of the Fedlines. Gold has dropped over $5 while I've typed! Whatever. Reports have it that today was London's strongest physical demand day yet for 2013. Realization that QE really is to infinity will only serve to drive demand even higher. Once again, BTFD!
TF
