The Cartel Is Terrified

The question of "manipulation" in the Gold market has been asked repeatedly. If ever there was a single day that represented this "capping" of the Gold Price, today may be it. The ever eloquent Dan Norcini over at Jim Sinclair's MineSet http://www.jsmineset.com/home.asp today put into words what many of us have been observing and bitching about for months:

Folks - I have to say that today was one of the most blatant capping efforts I have seen in gold in some time and that is saying something. With the dollar breaking through major support and with crude oil moving up along with the CRB index, to see gold struggle to keep its head above water was almost comical if it weren't so obvious as to what is going on.

You have to wonder what it is about the number "666" that the enemies of gold are so obsessed with holding the gold price below it. I mean, we could not make this stuff up if we wanted to for Pete's sake!

The official sector is so terrified of letting the gold price get away from them that they are making fools of themselves since even the most obtuse are beginning to realize that something stinks to high heaven in the gold market. My own personal view of this is that anyone, and I do not care how well-respected or how well known they are, who denies that there is official sector intervention to keep the price of gold down is willfully blind and has forfeited any right to be listened to when it comes to commenting on gold. I have been a trader for nearly 20 years now and have seen all manners of markets trade and all manners of price action and will state categorically that no other market on the planet trades like the gold market. The price action in gold cannot be explained any other way than by attributing it to official sector intervention.

Market commentary from the usual nitwits to explain gold's weak price action was encapsulated in the view that gold traders were waiting to see what Fed Chairman Bernanke would be saying in his speech at 1:00 PM EST. Oh sure, I get it, traders are concerned about the dollar's reaction to any talk of Fed action on the interest rate front. Meanwhile the dollar falls into a black hole! And to think some people actually get paid to produce this sort of swill...

The friends of gold can rest assured that those who are vainly expending energy and resources into suppressing it are spitting into a hurricane. They should really give it up since they are no longer fooling anyone. Once a ploy becomes widely known, it no longer serves any useful purpose. Screwing around with a yardstick does not mean that one can alter the fact that there are 36 inches in that yard. In the same manner, attempts to alter the barometer of gold have ZERO affect on the conditions that are calling for its inexorable rise higher...

And despite the vigilant efforts of the "gold cartel" to suppress the price of Gold it continues ever higher. As the monthly chart of Gold above clearly shows, since double bottoming in 2001 Gold has RISEN steadily. Since clearing the launch pad at 415 in the Summer of 2005, Gold's ascent has been prominent. Looking at Gold on a monthly chart makes one wonder what all the worrying has been about...powerful bull markets climb a wall of worry.

Gold is not going to stop at the Moon. Gold is going to the heavens. Stage One's ascent following liftoff in the Summer of 2005 has been rewarding for those fortunate enough to be on board when this bird took flight. The smart money, Gold Bugs, and contrarian speculators long ago packed their bags for this trip, and have been picking up supplies on the cheap along the way. The ship is less than half full of passengers at this time. Investors are now queuing up for Stage Two. As Gold breaks the downtrendline of the May 2006 high, Investors will begin fighting for a seat at $682. Since carry on baggage is not permitted for new passengers, these "investors" will be forced to pick up supplies along the way at ever rising prices. Stage One ticket holders stand to benefit immensely from these investors joining the passenger list.

All aboard! Next stop $1045 Gold.

The company's bugler is licking his lips as the US Dollar collapsed today on news of China's trade Surplus. December 2005's low of 80.35 is the cliff the Dollar is fast approaching. If it goes over the edge here, our bugler will be playing taps as the Dollar falls into an abyss below.

Gold and Silver by all rights should have been SUBSTANTIALLY higher today on this collapse in the Dollar. I'm confident it soon will be... 664 Gold was noted here as dem Rat Bastids "last straw". They certainly rose to the occasion today. Silver vaulted 12.75 today and singed the the Vermin and their paper Comex short positions. Silver was capped at the 12.95 50% Fib retracement of the June '07 high. The downtrendline off that same high was clearly broken at 12.75. I suspect we will see only higher lows from here in Silver for the balance of 2007. The 13.10-15 area is our next target. I suspect we may not see a "tradeable" high in Silver prior to the 13.70s.

Begin to focus on the Gold/Silver ratio again. A break below 49 could send both Silver and Gold lurching forward.

Buried in a Landfill Of Debt

What is a country whose GDP is built on a foundation of debt? DOOMED...

AP
May Consumer Borrowing Jumps 6.4 Percent
Monday July 9, 7:09 pm ET
Consumer Borrowing Posts Hefty 6.4 Percent Increase in May, Propelled by Credit Card Debt
http://biz.yahoo.com/ap/070709/consumer_credit.html?.v=11

The Federal Reserve reported Monday that consumer credit rose at an annual rate of 6.4 percent in May, far above the small 1.1 percent gain of April.

The increase was propelled by a surge in the category that includes credit cards, which rose at a rate of 9.8 percent in May after having a tiny increase of 0.2 percent in April. The jump in credit card debt was the largest since a 14.5 percent rate of increase in November.

"April consumer credit surprised us by being weaker than expected, and the May performance was stronger than expected. Probably, the best thing to do is average the two months," Wyss said.


The overall economy, weighed down by a slump in housing, grew at a lackluster rate of 0.7 percent in the January-to-March quarter, the weakest showing in more than four years.

But economists believe strength in employment and consumer spending will help provide a stronger performance in the April-June quarter, with many looking for the gross domestic product to expand at a rate of 3.5 percent or even better.

The report on consumer borrowing will provide support for the view that consumer spending has held up, despite the weakness in home sales and soaring gasoline prices during the spring.
For May, consumers increased their borrowing by $12.9 billion to a record level of $2.44 trillion. Economists had been forecasting that consumer borrowing would rise by a much smaller $6.5 billion.


Strength in employment and consumer spending? LOOOOOOOOOOOOOL!!! The strength in employment is blatantly fictitious and the strength in consumer spending is obviously the result of a multiplying mountain of debt. IMO they should have a new GDP report that is "ex credit card debt". For without the plastic, this country's economy would certainly be going in reverse. These numbers are, and should be, alarming. They should not be trumpeted as "positive for the economy going forward". They certainly didn't lend any aid to the tumbling US Dollar. Rising consumer debt, government debt, corporate debt...never forget: Each and every Dollar is a promise to pay a debt. The world is awash in Dollars, and therefore an insurmountable pile of debt. A pile of debt that will one day bury our nation in despair. Rise above the pile of debt...BUY Gold and Silver.

I stop to ponder...how much of May consumer credit card debt was to purchase food and gasoline. Oh, that's right, I forgot...nobody buys those items. That is why we don't include them in the national Consumer Price Index. What year is it anyway? 1984?


Gold made an impressive move today through 658. Gold tried to break away from da Rat Bastids on the Comex this morning, but was quickly capped at 663...within a whisper of the last straw at 664. Gold and Silver both fell quickly after the Comex open this morning, despite rising Oil prices and a relatively flat Dollar. The Comex Vermin are going to fight furiously and without honor to suppress both Gold and Silver as we move ahead.

Silver made a made dash thru 12.75 to post a high of 12.86 at precisely 8:45AM EST. And battled with the Vermin for the balance of the day to successfully close above it's 65 week moving average and key Fib resistance noted yesterday as well.

Silver was well into the 13s, Gold was trading in the 670s, and Oil was capped at $67 the last time the Dollar was this low in late April. Gold and Silver are wound very tight right now. It should be noted that the MACD on the daily chart of Silver only just crossed over bullish on Friday. Four days after Gold's daily MACD crossed over bullish on the 1st of July. We've only just begun. And what have we begun? The beginning of the end for dem Rat Bastids.

Gold support should begin to firm now at 653, with silver support now at 12.46. Gold may well bang around between 656 and 663 for the balance of the week prior to Friday's Retail Sales Report. Silver may do much the same between 12.62 and 12.80. A consolidation in Oil prices here is/was to be expected with hidden resistance at 73.75. Prices hit 73 on Friday. Oil prices should remain above 70, with solid support at 67-68. Consolidation in Oil prices may not be enough to hold back a rise in the Precious Metals as the metals have some catching up to do. Copper closed above 360 today. Silver and Gold both are lagging Copper. Gold needs to reach 675 just to catchup to Copper now. Could Copper breaching 375 signal a Gold move to 700 is imminent? The Dollar remains at a crossroads here with few friends and little in "economic data" between now and Friday to try and hang it's hat on. Friday's Retail Sales data could be the straw that breaks the Dollars back...but I won't hold my breath. It's 1984...

All The World's A Stage

For Gold, All the World's A Stage...and the stage has been set. The battle between the forces of good and evil in Gold is on. In the words of Bob Chapman, The International Forecaster, "The cartel is in trouble."

Turkey’s gold bullion imports almost tripled in June as the wedding season held forth. That is a 178% increase yoy.

The stage is set for a bitter wage despite in the South African gold mining- sector after employers tabled an offer of a 6% increase compared to demands of 15% to 20% from the main trade unions. The 6% offer doesn’t even match inflation. We do not see an early settlement. Be prepared for at least a one-month strike.

Worldwide gold producers are facing mounting costs and they cannot make money at these gold prices. Central banks and Western governments cause all of these problems. They are increasing money, credit and inflation and simultaneously selling gold into the market. This is not a free market. It is a corporatist, fascist market. Yes, investors and companies get hurt financially, but much worse workers worldwide, who work for mining companies, get hurt much worse. You can see how much the rich elitists care for the common man. These Illuminists are not just hypocrites; they are criminals.

Commodities were strong and copper is about to breakout over $3.60 again to retest $4.00. All those in the pits, especially in London, know there are fully paid warrants claiming between 140% and 169% of the copper in stock. The copper market is soon going into default. Stockpiles have dropped for the 8th consecutive session, falling 2,425 tons or 2.2% to 107,950 tons. This year stocks have fallen 41%.

The Fed can now only stand still and watch. The game is almost over. In four years there may no longer be a Federal Reserve. There game and the game of the other Illuminists will be over. The dollar will soon test 80 and it will break, as interest rates move higher.

http://news.goldseek.com/InternationalForecaster/1183931692.php

Fridays action in the Precious Metals was very encouraging as the US Dollar failed to catch much of a bid off of the June non-farm payrolls numbers and quickly slipped back underwater boosting the metals. Silver had a remarkable day Friday, closing 38 cents off it's low of the day. Is the rest of the world finally catching on to the farce these non-farm payrolls numbers represent? Dan Norcini over at JSMineset, http://www.jsmineset.com/home.asp , had some wickedly amusing commentary regarding these "bogus" numbers on Friday:

The big market mover today was the monthly exercise in statistical gymnastics by the Labor Department, aka the Payrolls Report. This time around, the pencil pushers – check that – the keyboard pounders – managed to find 132,000 new jobs for the month of June. That surprised the “expert analysts” who had placed their money on the red for an average of 120,000.

In another astounding feat of data prestidigitation the feds managed to “discover” another 33,000 for the month of May as they revised their previous “esteemed accurate count” of 157,000 to 190,000. Not satisfied with that bit of legerdemain they proceeded further on back to April and pulled an extra 42,000 jobs out of their black hats, revising that number upwards from 80,000 to 122,000.

Folks, I have to ask you, how many of us who live in the real world could consistently produce such grossly inaccurate and bumbling reports time after time and still retain our current paid positions in the workforce. Imagine a corporate planning board basing their business strategy off of estimates being created within their own firm that contained this degree of accuracy – off nearly 20% one month and 50% the prior month!

What is perhaps more amazing to me however is that so many people actually believe this swill that the government serves up.

And now, the stage is set. Gold is banging it's head on the downtrendline off of the May high, the 50% retracement of the same May high, and the neckline of a Reverse Head & Shoulders that has developed around the June 26th low simultaneously as I type this Sunday evening. A break and close above 658 may be just what the doctor ordered and light a fire under the shorts in this market. Is a short squeeze imminent? Dem Rat Bastids will not go down without a fight. Look for a marked increase in volatility as Gold attempts to power higher from here. 664 may be the Comex Vermin's last straw before their backs are broken.

Silver's battle for control of it's 65 week moving average continues at this hour. 12.64 is the line we must gain control of if Silver is to move higher. It should be noted that the 65 week moving average coincides with the 38% retracement of the February high off the major low of June 2006. Note also that the last time Silver was below it's 65 week moving average for two weeks running was the low established in August 2005. Silver went parabolic following it's recovery from this major low and ascended to it's highs in the 15's in May 2006. Past performance is no guarantee of future success, but the Summer of 2007 is looking more and more like the Summer of 2005 as each day passes now. The similarities of the two consolidations following major tops in Silver is uncanny. Da Rat Bastids know the consequences if Silver breaks back above today's triangle...their demise. Friday's 12.74 high was our first look at the battle line. I expect the Comex Vermin to fight dirty to hold this line. 13.03 will reappear eventually as the last straw that could break dem Rat bastids backs once and for all this year.

Please click on charts from http://www.usagold.com/live/price-break.html to enlarge.

Conjunction Junction

Leave it to Jim Willie CB, at GoldenJackass.com to tell it like it is in his most recent piece of eloquence: Garbage Bonds & Bonfires.

Without a doubt the USDollar is the weakest link, as numerous holes must be plugged to in the leaking dike. Gold and silver must be prevented from a zoom rise in price, since they serve as warning signals. Crude oil and natural gas must be prevented from a zoom rise in price, since they directly strain the USDollar. The long-term interest rates must be prevented from jumping higher. The stock market indexes must be prevented from falling sharply, since the public sees stocks as a visible signal of wealth. The USDollar must be prevented from a sudden freefall. The entire Wall Street and US Federal Reserve leadership is in the process of soiling their skivvies. The best investment might be in Depends Adult Diapers.

In the face of a weak link USDollar, a fast eroding Petro-Dollar defacto standard enforced by Persian Gulf principal players, one should expect the crude oil price to hurtle higher. It is doing precisely that. Blame had been put on the Nigerian situation, but that is but a false facade and distorted assessment intentionally given. The links have always been firm between the USDollar and crude oil. The alchemists cannot control them, while at the same time keep their controls in place on the vast price capping required throughout the Western bond world on long-term interest rates.

In time, the push upward in crude oil price will be matched by a push upward in the gold price. The two are strongly correlated. A systemic bonfire has been lit, the effects of which will undermine the confidence in the US banking system, the US bond arena, and the USDollar itself. To date, the authorities have succeeded in tossing a wet blanket over the gold market. See the monumental official gold bullion sales out of Europe. But they cannot break gold, which has been successfully defended at the $650 mark. In time, analyses will surface that the entire US banking system is at risk, possibly to repeat the Japanese 1990 decade outcome.

Gold over $700 by year end seems assured, but one is hard pressed to exude confidence at this point. Take comfort in its resilience. And by the way, watch gold but ride the silver vehicle, which will outperform gold by a 2:1 ratio, as usual. Central banks dump gold, but nobody dumps silver. The powers scramble to meet delivery in silver, in fact. Also the very large commercials are in deep trouble on their short silver positions, unable to cover at these lower silver prices.

http://news.goldseek.com/GoldenJackass/1183659327.php

If you have the time I highly recommend reading his entire post at goldseek.com. Jim Willie minces no words and definitely calls it as it should be seen.

The US Dollar is a slow motion train wreck. I lost count of the times I saw Gold mentioned today in various media as "weak in the face of Dollar strength". LOL, if today's action in the Dollar is regarded as strength, I pity the fools buying them.

If I read Jim Willie correctly, a "conjunction" of financial elements is coming together that once lined up, could unleash economic kaos across our once great nation...and probably the entire globe. A kaos we hope to profit from with our positions in Precious Metals firmly in our grasp.

Of the four charts I have today, probably the most interesting is the HUI/Gold chart. There was a major breakout in Gold Stocks today relative to gold. A downtrend line in this ratio going back to the May 2006 highs in Precious Metals was broken for the first time today. This could be huge. Gold Stocks historically have a tendency to lead the metal higher [and also lead it lower]. It is my belief that major short players in Gold Stocks are beginning to cover their shorts in earnest as they begin to see the writing on the wall: The US Dollar is toast...burnt toast.

The HUI Index as you can see above is poised for a breakout. I have lost count of the failed breakouts in this index over this past year, but the HUI looks poised today to take advantage of the coming "conjunction" of financial elements.

The rising price of Oil and the impending demise of the Dollar are probably the two most recognised Elements of Conjunction. Rising copper prices leading to a spike in the CRB index, and crashing US Treasury Bond prices are also elements of this coming conjunction. Oil is nearing possible hidden resistance at 73.75 as internal indicators RSI and MACD become overbought. The path of least resistance in Oil now is clearly up, with $67 now looking like a formidable floor in price for the balance of the year. The Dollar is teetering on the edge of the cliff as we breath daily. Today's intraday low [81.24] was one pip below the intraday low at the beginning of May [81.25].

Please click on the charts above to enlarge them and see further analysis contained within.

Gold and Silver were once again bombed and pillaged at the open of the Comex this morning. The desperation of dem Rat Bastids grows by the hour. It is becoming more obvious by the day that the ONLY time the precious Metals come under significant pressure is during the Comex hours of "paper trading" in the metals. The Asians love it, and scoop up the metal on the cheap daily now...the shorts in these metals have to have their fingers resting on the panic button...the jig is almost up as fewer hands are willing to part with their Gold to assist the shorts in covering the colossal positions.

Silver held 12.46 again today to maintain pressure on da Rat Bastids in that market. Gold bent a little today but has bounced hard off hidden support at 646. Silver needs to gain control of it's 65 week moving average before we can make plans to the upside. Gold must solidly regain the lines at 653 and 656 before we can get to excited. If Oil prices stay above $70, Silver and Gold should soon hook their engines to that locomotive and the train will leave the station.

Catalytic Copper?

The Fourth Of July has now come and gone. Our Independence, "questionable" at this time in our history. 60% + of our nations Debt is owned by the Japanese and the Chinese...I'd say that make us pretty dependent these days. What a sad state of affairs...

Cheer up! Gold and Silver are still available at sale prices. Both metals performed admirably on Tuesday in the face of obvious pressure by dem sleazy Rat Bastids on the Comex. "Remarkably", both Gold and Silver were tanked right off the open on Tuesday. An obvious attempt by these weasels to take advantage of the days light volume in New York ahead of the holiday. The Dollar found tepid buying at best Tuesday and the metals in no way deserved the reaction they got at the Comex open.

Silver held the line at 12.46 and Gold held the line at 653. A big round of applause for both. Gold now needs to clear 656 and challenge the shorts at 660. Silver needs to reestablish bullish control of the 65 week moving average and prepare for the Battle royal with the shorts at 12.75.

Is the two month consolidation in Copper ending? Will a breakout from resistance at 350 Monday lead to a new upleg in Copper to test May's 380 high, and could this breakout be the catalyst for a big move up in all commodities and Precious Metals? Time will tell...either it will or the continuing failure of the US Dollar will. The balance of this traditionally light trading week will prove most illuminating. The rest of the World doesn't go on vacation when we do...and it appears the rest of the World is becoming intent upon taking control of the US Dollars fate.