What Else Could This Be But Buggery

The only time i saw a pattern like this was after a mistake of some sort. News error or Computer glitch like over last Summer. Unreal what these guys are doing to the silver market. They have the rules stacked in their favor and backed by the government and cause pain for any amount of time they wish (keep printing more money). And when they don't like the rules, well they will just change them. I can't believe this is happening here, in the greatest country in the world!

So Everyone is Printing Money: Zerohedge.com

Henry Morganthau Jr., said in 1939:

Never in the history of the world has there been a situation so bad that the government can’t make it worse


Greenspan started this calamitous monetary expansion to bail out US Inc and banks from the tech wreck in 2000,as revealed in the chart of the price of gold  below.  Bernanke continued the stimulus and Darling/Osbourne, Trichet et had no choice but to follow.


The Japanese has had thrown vast amounts of stimulus money at the economy since 1990 to little or no effect and all they got was more debt


 Read More

SPX & Metals Update

What can anyone say about what we saw in Silver yesterday, I mean WOW! It was absolutely staggering (a fall of a cliff, it was like the day), the banksters waited until the close of the Comex and hammered paper silver into the ground. I am really nervous again today for I feel another haircut coming around the same time as we saw yesterday, can't assume its a one day phenomenon. Or maybe they dont want to mess around over the weekend, a lot can happen globally (Egypt, Libya etc). The physical players love it when the paper guys do this stuff and then they just come in and buy it cheaper. I was in a lot of pain yesterday.

Thursday's session began with a small gap lower and traded a few points downward before quickly bouncing to put the high of the day on the chart at 10:21. But from then until 2:00 pm sellers came in wave after wave and took the index down almost seventeen points to put the low of the day on the chart at 1:56. 


But a very sharp bounce ensued bringing the index up more than ten points off the lows in about forty-five minutes. But buyers weren't yet done; after a brief consolidation the index was ran up another five points. But traders surrendered a few points into the close to finish the session just into the upper third of the intraday range.


Yesterday I wrote about not buying this dip and once again my indicators (self developed of course) WRONG AGAIN. It looked for a while there as 15 minutes after i wrote dont buy the dip, the market fell harder. But as usual something happened that the market then listening to my call just stopped on a dime and reversed course and is up about 24 points off that low. On a consolation note I wrote about a short-term target of 1290, well we got as far as 1294 so, Ahhh i still dont feel any better. 


SPX breadth was positive. NYSE breadth was positive. NASDAQ breadth was positive. Yet many indices closed negatively. But the ten day average of Net Advancing moved upward today and the NYSE Composite Index outperformed the SPX. indices are in rally mode on Friday, there will is denying that the character of the market has not changed. SORRY BEARS.


Sectors stronger than the SPX for Thursday:
- Industrials -- Outperformed the SPX by +65%.
- Technology -- Outperformed the SPX by +45%.
- Health Care -- Outperformed the SPX by +45%.
- Consumer Discretionary -- Outperformed the SPX by +70%.
 
Sectors weaker than the SPX for Thursday:
- Basic Materials -- Underperformed the SPX by -42%.
- Energy -- Underperformed the SPX by -132%.
- Financials -- Underperformed the SPX by -14%.
- Consumer Staples -- Underperformed the SPX by -31%.
- Utilities -- Underperformed the SPX by -29%.
  

Time to step in and re-buy URZ

Been right about this stock since it was at 2 bucks, the MACD is at an oversold level the last time its was down here the price skyrocketed, the secular bull in Uranium is alive and well see previous posts on the matter. Its holding the 50dma. Put a stop close below whatever you are comfortable with, I'll take a 5% hit on this new buy.

I Would Not Buy This Dip!

At yesterday's lows, the S&P 500 had dropped 40 points in just two days. All February's gains were wiped out. Mom and pop investors, who piled in last week at the highs, are now uncomfortably underwater. The financial media is already telling people this is a buying opportunity all the sell-off are temporary. They weren't doing that before, especially when all the problems in Greece and Ireland started then it was a different tune I feel that people are less fearful now, and that makes me extremely cautious. and excuse me, but isn't this the same advice the talking heads were giving bond buyers last September? (Bond prices are down about 15% from their September highs.) 


Know you enemy! Greed and Fear are mine as with most investors we get scared out at exactly the wrong time. That why I have developed my tell for when I am wrong, if every bone in my body says buy, buy, buy, then I am a 100% wrong and visa versa. I want to buy this dip. I have to buy this dip! 


After all, I have missed the rally since August in the S&P. Been in metals and oil and Ag but not really believing this move.

We've had too many technical indicators stretch too deep into overbought conditions for too long but they have been no match for QE to infinity talk. So we'll see where this goes its to early to tell if we keep going lower than the 50dma. But for me if I need a sell-off below the 50dma with a failed test of that 50dma to be short anything except bonds of course which i have been since I started writing this blog.

Metals Update

Gold and silver rebounded beautifully from yesterday. Gold rose by $12.70 to$ 13140.70 Silver on the on the other hand did exceptionally well rising by 44 cents to $33.40. In the access market silver is now trading at $30.55 and gold at 1411.40. The banksters seem intent on building a wall at around 1420.00 or so, gold's previous high, if it can break that mark we could rally to 1520-1540.





The total gold comex open interest rose big time at14,285 contracts to rest at 502,119 contracts.The estimated volume at the Comex fell off again as the speculators seems to have left the area. Only players willing to take delivery seem want in right now, at 136,153. Look at the confirmed volume yesterday when the banking cartel provided loads of unbacked paper gold shorts. The confirmed volume was at 234,182 contracts.
In Silver, total comex OI fell by only 5090 contracts and that surprised me. I had expected a bigger contraction due to the increase in maintanence and initial holdings.


The estimated volume at the silver comex was nothing short of beautiful. The estimated volume today was a superb 118,542. The confirmed volume on the comex on Friday was get of load of this ; 180,614.

We have now scared off the week players and now the remaining players are resolute. Our banking cartel are not happy with this result. The Friday introduction of CME raises did nothing to our resolute longs. I think we have another 5 or 6 % move left in silver before we pull back to 30 at worse.

Bears In Control

Next target 1290

On Wednesday morning it looked as if the bulls were trying to draw the line at yesterday's lows and looking to see if they could convince buyers that yesterday was once again a one-day wonder. But futures dropped six points the hour just ahead of the open. We didn't have any major economic data to review before the open, and we were waiting on Existing Home Sales at 10:00 am, although I am pretty sure no one really cares about that data any more.

The session began without a significant gap and moved quickly to put the high of the day on the chart just fourteen minutes into trading. But then the bears once again took control and pushed the equities lower in multiple waves that really got underway in earnest just after 11:00 am. At about 12:20 the SPX bounced off support and soon retested the level and attempted to bounce again. But this was quickly snuffed out before support was briefly violated and the SPX bounced once more. The low of the day was painted at 1:19 and this mid afternoon bounce carried the index almost thirteen points off the lows. The closing hour was even choppier than the rest of session as the index closed with a sell-off and ended at about the middle of the intra-day range.


Volume was once again heavy today and clearly the intraday volume patterns spiked on the downward moves. Looking at the Nightly Breadth Indicators is interesting again last night as several of the indicators are moving upward while the McClellan Oscillator is reaching into oversold territory.


On an interesting note the Agriculture stocks like Agurium, Potash, CF industries, Mosaic and the like painted really nice looking hammers. Unfortunately above my bids. I had mentioned in my post about them yesterday that they had sold off prior to the market fall off a cliff and they may rebound before we put in a bottom to this correction. I am usually never right about this, having finally acknowledged that, I'll be right just this the one time!


Sectors stronger than the SPX for Wednesday:
- Energy -- Outperformed the SPX by +260%.
- Financials -- Outperformed the SPX by +65%.
- Consumer Staples -- Outperformed the SPX by +36%.
- Utilities -- Outperformed the SPX by +38%.
 
Sectors weaker than the SPX for Wednesday:
- Basic Materials -- Underperformed the SPX by -12%.
- Industrials -- Underperformed the SPX by -115%.
- Technology -- Underperformed the SPX by -66%.
- Health Care -- Underperformed the SPX by -36%.
- Consumer Discretionary -- Underperformed the SPX by -86%.

China Bans Reincarnation Without Government Approval

http://maxkeiser.com/

20dma Breached

SPX Gives up all the gains for Feb in one day! And now its given up the 20dma. Next stop 1290. Last time I said that it rallied to the Feb High so don't listen to me on this one but THIS TIME IT FEELS A LITTLE SCARY. By the way how are Portugal, and spin and Ireland and Greece doing, Yep, they forgot all about those guys right, I'm talking about the financial media. Take profits buy metals not too late for that but oil cures itself as people will just not fly, or drive or car pool or wait for it maybe the bozo's in Washington will finally start using the Nat gas thats pilled up, that can sustain us for 500 years or so they tell me. C'mon "wake up DC". China is buying up Nat gas, coal resources etc for a reason. India and other developing nations use Nat gas to power their vehicles, why can't we. I own no Nat gas stock or ETF its been dead money for a long time, Full Disclosure.

OIIM

This sell-off maybe the best opportunity to get this stock. Look to enter piecemeal from 7.5 and 8 bucks we get lucky and this selling continues. This is a play on the secular growth in the Chinese consumer, do your own homework on the funde's. 

Stock to Watch

I recently learned about a deal in a company called Gold bag soon to be renamed Focus Gold (GBGI OTCBB) . The company has properties in both Mexico and the Timmins district. The company recently released a Technical Report (the "Report"),pursuant to National Instrument 43-101, on the company’s recently acquired Huicicila Project in Nayarit state, Mexico. The report was prepared for Focus Gold by consulting geologist William Feyerabend (the "Geologist").

The report describes the project as an "economic to bonanza grade goldsilver deposit" with the identification of "multiple veins with high gold analysis and gold demonstrated over 200 vertical meters." The report also points to the potential of discovering "more ore shoots of roughly the dimensions and grades of the SARCO historical reserves." Because of the high gold values shown in multiple veins, the reports states that "a focused exploration program could thus discover 500,000 ounces of  gold" and that, "no social or environmental issues were discovered."

  

The company has also announce the renewal of the Mining Leases for the Watabeag and Russell Creek properties has been approved by Ontario’s Ministry of Northern Development, Mines and Forestry. On October 10, 2010, Focus Gold announced an option agreement with Victoria Gold Corp to acquire the properties located in the Timmins Mining District in Ontario, Canada, one of the world’s most prolific gold mining areas. Under the terms of the Option Agreement, Focus Gold will acquire 100% ownership of the Properties upon issuance of 250,000 shares of common stock and the expenditure of $2,000,000 for cumulative Exploration and Maintenance on the properties, to be completed on or before the third anniversary of the date of the Agreement. Renewal of the Mining Leases will allow Focus Gold to commence exploration and maintenance on the properties.

Therefore, the company is position on both  Mexico and Timmins two of the most mining friendly districts in the world. I expect aggressive drilling in the Huicicila project going forward.  Therefore, this is the type of deal I like in that it has the potential to create a small resource then aggressively drill to expand on that resource. I bought a financing in the deal and I expect it to move higher going forward.

There has been a big seller in the stock over the past few days with over 1 million shares traded in the past few days. However, the stocks seems to absorbed a lot of this selling. Therefore, if this individual continues to sell you still might be able to get some cheap stock going forward. Once the stocks works through this selling it might move significantly higher.

Remember as before, this is a secular trend (higher gold and silver) so there is no need to rush in and take big positions, there are always pullbacks but at the 150 here, is a good spot to open a 50% position and add as desired. 

GREAT ARTICLE

The daunting tower of national, state and local debt in the United States will reach a level this year unmatched just after World War II and already exceeds the size of the entire economy, according to government estimates.

But any similarity between 1946 and now ends there. The U.S. debt levels tumbled in the years after World War II, but today they are still climbing and even deep cuts in spending won’t completely change that for several years.

As President Obama and Republicans squabble over whose programs to cut and which taxes to raise, slow growth and a rising tide of interest payments – largely beyond their control – are making the job of fixing the budget much harder than in the past. Statehouses and governors face similar challenges.

After World War II, the federal debt – including debt purchased by the Social Security Trust Fund – hit nearly 122 percent of gross domestic product. State and municipal debt back then was minimal. By the time Dwight Eisenhower was elected president six years later, the federal government’s debt had dipped to about three-fourths of GDP.

The key factor in the rapid drop in government debt, said Harvard University economist Kenneth Rogoff, was fast economic growth. Spurred by a young labor force, world-leading manufacturers, high personal savings rates, a pent-up demand for consumer goods after years of war and the Depression, and a bout of inflation, the economy grew 57 percent in six years. Thanks to sharp postwar cuts in defense outlays, federal government spending also tumbled for a couple of years.

http://www.washingtonpost.com/wp-dyn/content/article/2011/02/20/AR2011022003201.html

Start Nibbling on Fertilizer (Stocks that is)

It was all about oil as the violence in Libya took center stage. Global markets were lower over the holiday lengthened weekend and the futures in the U.S. suggested a more than 1% drop at the open. The holiday shortened week began with a nasty gap lower. An early low was painted just six minutes into the session and dip buyers quickly mounted a charge. Within forty minutes the SPX had recovered more than ten points, certainly bringing to mind all of the disappointments that bears have experienced for months. But this day was different. The bears recovered control and the index began to sell off. After ninety minutes the lows of the day were once again at hand. And then the bears showed some muscle and pushed us into a rare low after the first hour of the day. From 1:30 pm through 3:00 pm was consolidation near the lows before the final hour of the session saw the index break through support. The SPX 1315 area was tested at least four times today before eventually going lower but coming back to close there.

The late session news that Qaddafi ordered the destruction of oil pipelines certainly could drive the price of oil upward even further and thus bring inflation fears to the forefront and cause the SPX to sell even further.

This was widespread sell-off affecting all sectors. Except, wait for it Precious metals (but not stocks in that arena) and oil ETF and some oil stocks.


For the SPX Index there were 35 components advancing and 449 components declining. On the NYSE 3,162 issues were traded with 356 advancing issues and 2,751 retreating issues, a ratio of 7.73 to one declining. There were 133 new highs and 14 new lows. The five day moving average of New Highs is 272 while the five day moving average of New Lows is 11 and the ten day moving average of Net Advancing is 175.

Declining volume was higher at a ratio of 10.52 to one. The closing TRIN was 1.36 and the final tick was -700. The five day average of TRIN is 1.08 and the ten day average of TRIN is 1.06. The NYSE Composite Index lost -2.14% today while the SPX lost -2.1%.

For the NYSE, relative to the previous 30 session average, volume was 27.78% above the average. Of the last 15 sessions 5 sessions ended with volume greater than the previous rolling 30 day average volume. Of the last 30 sessions, 23 sessions ended on a positive tick, 8 of last 10. For the SPX, the day's volume was 125.7% of the average daily volume for the last year. Volume was 136.2% of the last 10 day average and 143.2% of the previous day’s volume.

There can be little doubt; breadth today was strongly bearish. Yet the ten day Net Advancing remains in positive territory quite close to 200. We’ll need to see another day close negatively before we get too excited on the bearish side.

Total tick for the day was -377,000 and the average tick for the day was -244. There were 13 ticks greater than 600 and 239 ticks more extreme than -600. There were no ticks greater than 1000 and 34 ticks more extreme than -1000. The tick action suggests institutional distribution.

Volume was heavy today; the heaviest of the year. Intraday, the largest spike of volume came with the break of the lows just after 1:00 pm. Looking at the Breadth Indicators its is a bit curious as several of the indicators are up but overall, the most sensitive indicators are showing the impact of today's selling. Still, we will need to see follow-through on the selling. Bears have had their buts handed to them since august of 2010 as every sell-off turned into a buying opportunity. THIS CYCLE MUST BE RESPECTED, I have been wrong on every sell off, and so if anyone wants to go short just do the opposite of what I have been doing in terms of SPX.

As I stated yesterday, the SPX has been holding the 20dma and it did that yesterday, futures are up slightly this morning so today is the important day if you are shorting this market, if bulls don't hold I think we go to 1290 next in the very short-term. One to two sessions, last December we had a similar sell-off of 40 points and the 50dma held.

Also that talk for QE3 has already started and it should happen and that again is going to trip up bears. For anyone who missed the chem/fertilizer trade, they started selling off before the rest of the market did (this is a great opportunity at cheaper prices, I would keep an eye on this group, for the next 2-3 decades this will be a great place to be, I like Potash (POT), and Agurium (AG) because they are in Canada (much more stable than the US will be) been long MOO for a while now, I think the prices of the metals will be so high that tractor and other machinery stocks may not do so well.

I put in a bid at 82 

Put in a bid at 150.50

Metals update to follow

Markets Clubbed

Asian stock markets took a beating Tuesday as investors sold down stocks across the region on worries about raging political tensions in the Mideast and North Africa.

Japanese stocks were hammered down as selling pressure mounted after Moody’s Investors Service lowered the nation’s ratings outlook, while New Zealand shares and currency skidded after an earthquake in the country’s second-largest city of Christchurch.

International turmoil in the Mideast and the Dow [Jones Industrial Average] being closed for an extra day have seen European markets lead the way with falls [Monday] and that is affecting sentiment.

US futures are also getting hammered and yes for those of you who are new to the markets the red numbers means selling.

Probably won't last with the FED programs back stopping the markets, but I don't with oil up 8% just this morning alone over Libya refinery shutdowns (wow), commodities at all time highs, who know what they will do, but Big Ben has said there isn't any inflation to worry about, and Washington obviously doesn't really care about debt issues, just play lip service to it. 

Lets see if the 20dma holds here, the open will put us at or near that level, see how much pressure there is going to be or people will think of this as a buying opportunity. 

Metals Update

Gold closed in London (12 noon est) at $1408.50 a rise of $20.30. Silver exploded northbound with a rise of $1.70 to finish at London closing price of $34.00 flat. There was a sense of panic on the shorts to cover as there were only buyers present and no sellers.

It is getting closer and closer to a systemic commercial failure(see below for an explanation). The comex was closed today so all the fun with begin starting late tonight. 

Wednesday night the official March contract goes off the board. Also all option-holders with in the money silver that wish to take delivery of metal must exercise his option and then wait for a delivery of a March future contract and then stand for delivery. The March contract continues to trade as the stragglers must decide whether to roll their contracts or stand for delivery. On the 28th of February at precisely 1:30 pm, we get to see how many open interest will eventually stand. We also see the total number of notices filed to be sent down for servicing. Deliveries may begin on March 1.2011 and continue throughout the month. If we have greater number of oz than exist anywhere then a commercial failure is upon us. In that scenario, expect cash settlements and a run on the banks and the comex to fail. 

There has never been a failure in silver and gold. The closest we have been to a silver default was the Hunt brothers in 1980 but the bankers were bailed out by the Government. The USA had 2 billion oz of above ground silver then. Today they have none!!

Read About Systemic Commercial Failure

America Is Broke

Saturday, the House of Representatives passed legislation with more than $60 billion of budget cuts. It is the proverbial “drop in the bucket” when compared to the $14.1 trillion (and counting) outstanding federal debt. Soon, this ever increasing national debt will eclipse the Gross Domestic Product (GDP.) That means America will owe more than all the goods and services it produces in one year. When you owe more than you make, isn’t that a sign you need to change course? The new Speaker of the House, John Boehner, said this just after the budget cut vote, “We will not stop here in our efforts to cut spending, not when we’re broke and Washington’s spending binge is making it harder to create jobs.” I think it is ironic Congress wants to cut $60 billion today and then turn around and consider raising the debt ceiling $1 trillion tomorrow. This is crazy, but that is exactly what’s going to happen because if we don’t, Treasury Secretary Tim Geithner says it could cause, “catastrophic damage to the economy.”

read more

Gold Update

Gold futures rally above $1,400 an ounce

LONDON (MarketWatch) — Gold futures surged Monday above $1,400 an ounce, as political unrest in the Mideast and North Africa unnerved investors and prompted them to seek a safe haven in the precious metal.

Gold for April delivery, the most actively traded contract, rallied $14.40 to $1,403 an ounce in electronic trading on Globex.

OS

News: Arab stock markets fall as commodities leap

TEL AVIV (MarketWatch) — Stock markets in the Arab world fell and key commodity prices leaped on Monday, as demonstrators dug in throughout the Mideast and North Africa, demanding more political and economic freedom.


OS (original Source)

Metals Update

For those of you who are listening to the the jokers on financial media suggesting that there is plenty of silver, please take a look at the exploding silver lease rates: (you can find them on KITCO.COM)

all lease rates above 1%. take a close look at the 30 day lease rate where it registers 1.2% and it is higher than the 60 and 6 months and 1 yr lease rate. What does this mean? Simple!!! there is no silver at any vault.
When you have the lease rate at 1% and investment rate at .1% per annum, you are automatically in backwardation by a full .9% per annum. I think there is plenty of trouble ahead.

As many of you are already aware gold and silver were up on (Silver as been on fire). Gold climbed by$3.50 to $1388.20. However the star of the show was silver climbing by 73 cents to $32.30. During the session it reached a high of $32.87 as the banksters panicked and started to cover their massive shorts.

The total gold comex open interest rose by 2369 contracts to 481,548 from Thursday's level of 479,179.

The front February delivery month saw its open interest rise from 648 to 653 despite 4 deliveries on Thursday.  The next delivery month of April saw its open interest also rise from 311,585 to 312,764. However the volume at the gold comex was still very low coming in at an estimated 104,766. The volume on Thursday was also quite low at 103,537.

This is of concern to our commissioners as business is leaving for London. It may indicate that investors want the physical metal and are not willing to wait for a future month to obtain their physical metal.

The total silver comex open interest rose to an unheard of 150,615. We reached this level before but that was when we had considerable calendar spreads which had no economic benefit. These spreaders have since departed so this volume is a true indication of demand. The rise in open interest from Thursday was a rather large 2349 contracts. Despite schemings of you know who, the massive buying in silver continued on Friday and the banksters finally gave up by covering massive short positions.

The estimated volume at the silver comex yesterday was 103,401 which is huge with small amounts of rollovers. The confirmed volume yesterday was also high at 103,195. The banksters are running scared!!

SPX Recap

As the Friday open approached futures were on a four point bounce after the overnight lows around 5:00 am and were at the overnight highs. Asia had closed consistently green and Europe was mixed.

The February options expiration session opened without a significant gap and traded slightly downward for several minutes before beginning to ascend. This session avoided the first hour lows and gently traded upward to the high of the day at 12:27 before an almost six point sell-off leading up to 2:30. But the final ninety minutes of the week were a very low volume rally as the index managed to close back near the highs of the day.

The pattern of closing at the highs has been persistent. In the last fourteen sessions the SPX has closed in the top 15% of the daily range eleven times and only once in the bottom 60% of the intraday range. But today was different in a couple of regards. The NASDAQ 100 (Qs) was down for the day, the second consecutive day and Russell 2000 closed lower than the open. So there may be a few signs of weakness creeping in, although in this strong uptrend that may mean little.

Checking the Market Leaders board we find a mixed board with the Russell Technology and Sox both closing lower. But half of the leader board closed at new 52 week highs so the market rally continues.




It’s interesting to notice that advancing volume was only equal to declining volume when advancing issues were 1.37 to one advancing. Volume Friday was dismal; all the volume was at the open.


Sectors stronger than the SPX for Friday:
- Energy -- Outperformed the SPX by +32%.
- Financials -- Outperformed the SPX by +10%.
- Industrials -- Outperformed the SPX by +9%.
- Consumer Staples -- Outperformed the SPX by +8%.
- Health Care -- Outperformed the SPX by +6%.
- Consumer Discretionary -- Outperformed the SPX by +34%.

Sectors weaker than the SPX for Friday:
- Basic Materials -- Underperformed the SPX by -129%.
- Technology -- Underperformed the SPX by -34%.
- Utilities -- Underperformed the SPX by -3%.