Catch a falling silver knife - Notes on EJ's April 29 silver sell call

[jpetr48]

Re: Catch a falling silver knife - Notes on EJ's April 29 silver sell call

Fred,

Can you please update EJ's gold forecast? I recall he did say it was more difficult to estimate and that he expected prices to remain constant rather than fall as they did.

My question is now centered on a probable 15-20% S&P correction. It looks like gold will be liquidated as well in a market sell off- just wonder if EJ is more confident in forecasting gold now.

[FRED]

Re: Catch a falling silver knife - Notes on EJ's April 29 silver sell call

Today's update on the performance of gold and silver since the silver sell call April 29, 2011.

[bart]

Re: Catch a falling silver knife - Notes on EJ's April 29 silver sell call

Agreed. Those of us who poo-poo the suppression talk are not saying it is not being tried or that there is no motive, or even that it might mot be actionable by nimble traders, we just think it should not affect investment decisions as it cannot be a long term driver of price.

That would be a fair synthesis I think. If you or some other genius trader can profit from it, more power to you.

But when I see the "coiled spring" argument - essentially that suppression is powerfully effective and therefore the lower the price the higher it must go later, or whatever, that is when I reach for my gun....

Indeed - manipulation or vested interests or intervention or behind the scenes stuff does exist and can have substantial effects, but on something like the precious metal or hard asset long term trend, it has little long term effect when all is netted... and they can make a truly *huge* difference on the shorter term (a point which a certain "clownish" blogger can't or won't admit ;-).

Being aware of the tinfoil hat stuff sure does help in trading (and bah humbug on 'genius')(the majority of the stuff I use is 100% public), but perhaps surprisingly or non intuitively, they generally help more in the area of *not* making a trade than making one. Stated more clearly, various things I watch have an intervention indicator/algo attached and I won't start a trade when its high and close to the trigger point.

On silver itself, one of my top five reasons for getting back in back in 2003 was a GATA article showing how the commercials in the futures market had *never* been long - that's not conspiracy, that's a fact.

Overall, the only thing in markets are humans... and they can be very weird and illogical, and quite sneaky or even scummy too.

[rogermexico]

Re: Catch a falling silver knife - Notes on EJ's April 29 silver sell call

Sort of, but I do recall him quoting Volcker about gold being the enemy... which is part way there.

I also think he's not at all into the heavy conspiracy aspect of it espoused by many at places like ZH, as in his "sometimes a cigar really is just a cigar" overall view, or at least my take of it. When something goes parabolic or "excessive", it virtually always corrects - not unlike the mid 70s move of gold to $103 after hitting about $197.

Agreed. Those of us who poo-poo the suppression talk are not saying it is not being tried or that there is no motive, or even that it might mot be actionable by nimble traders, we just think it should not affect investment decisions as it cannot be a long term driver of price.

That would be a fair synthesis I think. If you or some other genius trader can profit from it, more power to you.

But when I see the "coiled spring" argument - essentially that suppression is powerfully effective and therefore the lower the price the higher it must go later, or whatever, that is when I reach for my gun....

[rogermexico]

Re: Catch a falling silver knife - Notes on EJ's April 29 silver sell call

My thought is that they're far closer to on the same team than not.

Precisely what makes the GATA crowd's perseveration about suppression incoherent.

Is gold a compelling investment in the presence of highly efficacious price suppression when the suppression is held to be so effective we should worry about it?

Makes no sense to me for the same reason it seems to make no sense to EJ.

[bart]

Re: Catch a falling silver knife - Notes on EJ's April 29 silver sell call

Agreed, and I check in with Sinclair's website regularly. But IIRC EJ consistently rubbishes the notion of gold or silver being intentionally kept down by the Fed and its proxies.

Sort of, but I do recall him quoting Volcker about gold being the enemy... which is part way there.

I also think he's not at all into the heavy conspiracy aspect of it espoused by many at places like ZH, as in his "sometimes a cigar really is just a cigar" overall view, or at least my take of it. When something goes parabolic or "excessive", it virtually always corrects - not unlike the mid 70s move of gold to $103 after hitting about $197.

[jiimbergin]

Re: Catch a falling silver knife - Notes on EJ's April 29 silver sell call

Agreed, and I check in with Sinclair's website regularly. But IIRC EJ consistently rubbishes the notion of gold or silver being intentionally kept down by the Fed and its proxies.

from Jesse http://jessescrossroadscafe.blogspot...at-end-of.html

"We looked into the abyss if the gold price rose further. A further rise would have taken down one or several trading houses, which might have taken down all the rest in their wake.

Therefore at any price, at any cost, the central banks had to quell the gold price, manage it. It was very difficult to get the gold price under control but we have now succeeded.

The US Fed was very active in getting the gold price down. So was the U.K."

Sir Eddie George, Bank of England, September 1999


"That day the U.S. announced that the dollar would be devalued by 10 percent. By switching the yen to a floating exchange rate, the Japanese currency appreciated, and a sufficient realignment in exchange rates was realized. Joint intervention in gold sales to prevent a steep rise in the price of gold, however, was not undertaken. That was a mistake."

Paul Volcker, Nikkei Weekly 2004


“Central banks stand ready to lease gold in increasing quantities should the price rise.”

Alan Greenspan, US Federal Reserve Bank, 24 July 1998

Re: Catch a falling silver knife - Notes on EJ's April 29 silver sell call

My thought is that they're far closer to on the same team than not.

Agreed, and I check in with Sinclair's website regularly. But IIRC EJ consistently rubbishes the notion of gold or silver being intentionally kept down by the Fed and its proxies.

[bart]

Re: Catch a falling silver knife - Notes on EJ's April 29 silver sell call

So that means....????

My thought is that they're far closer to on the same team than not.

[rogermexico]

Re: Catch a falling silver knife - Notes on EJ's April 29 silver sell call

And "GATA and Sinclair crowd" have similar expectations for gold as EJ, although EJ is not as "optimistic" on the eventual gold high.

So that means....????

[bart]

Re: Catch a falling silver knife - Notes on EJ's April 29 silver sell call

And "GATA and Sinclair crowd" have similar expectations for gold as EJ, although EJ is not as "optimistic" on the eventual gold high.

[rogermexico]

Re: Catch a falling silver knife - Notes on EJ's April 29 silver sell call

Can't the same question be asked of the GATA and Sinclair crowd with respect to gold?

I would and EJ has...

[bart]

Re: Catch a falling silver knife - Notes on EJ's April 29 silver sell call

I, like Adeptus, am trying to understand the movements of silver. I'd like to know if, in your opinion, the amount of second residences for sale correlate somehow with the silver market. The possible link: if confidence increases the amount of second residences for sale decreases and silver falls.

Thanks.

I don't track second residence sales so am not sure, but best guess I'd think the gold/silver ratio would have a better correlation than silver alone since the gold/silver ratio has a decent reverse correlation with liquidity, aka money printing.

Re: Catch a falling silver knife - Notes on EJ's April 29 silver sell call

How can silver have fundamentals so weak that the price can be so effectively suppressed, yet simultaneously the fundamentals are so strong that it must rise hugely when not being suppressed?

Can't the same question be asked of the GATA and Sinclair crowd with respect to gold?

[Chomsky]

Re: Catch a falling silver knife - Notes on EJ's April 29 silver sell call

Not really as first drop in April was preceded by something like 5 or 7 margin hikes in span of about a week. Latest drop was preceded by a another margin hike and perhaps some game playing by the majors.

Are margin hikes not consistent with a pump-and-dump, as EJ alleged the silver takedown would be?