Back To The Old PM Agenda?

Last week Friday saw the London PM fix for gold back to $1755.95 from the PM fix at $1794.60 the week before and at $1823.70 two weeks ago. Silver was last fixed at a frightening new low London fix for 2021 of $23.01 and an even worse close in NY at $22.29 – bad news after the much more solid London fixes $24.145 and $24.055 on the preceding two Fridays, respectively. It had looked as if the two metals could be taking a breather following the earlier onslaught on their prices, but this was not to be. Now the prospect for a resumption of the bull market of mid 2020 appears dim again, shortly after the hopes of the Bulls had received some welcome signals.

In last week’s USM I wrote the net short position of the Commercials stood at 43 252; up by 5285 (+13.9%) from the week before. Further, the price of silver had moved higher out of the gap island that had formed during the previous few weeks to give a bullish signal. The Barchart CoT data for silver then was already a week old, given the lag in the Comex reports. It therefore looked as if the gambit to force the large and small Specs to close longs and go more, which had started in June and initially had worked very well indeed, was no longer effective. Last week’s action reveals that the Commercials are still highly concerned about a possible short squeeze.

In mid June it looked as if the price of silver would break above $28 to resume the bull market of 2020. The Commercial net short position was above 72 200 and if the price had continued higher, the effect on their financial position would have been a disaster. That was when the suppression of the metal prices again went into high gear. By the time a gap island on the weekly chart had formed in late August, the Commercial net short position had halved to 36 126, with silver at a low of $23.14.

That must have pleased the Cabal to the extent that they slackened their grip on the PM market. Gold improved to above $1800 and silver broke above $24. Sentiment started to turn bullish again and the Commercial net OI worsened to the 43 252 of two weeks ago and now at 40 156 last week – a little lower as the silver price held mostly sideways after breaking $24, but from the action to Friday still a matter of great concern for the Cabal.

Could it have been that the lowering of the selling pressure once the gap island had formed was on purpose, intended to have the Specs going long of silver again, only to be hit the hard last week with the new low price for the year? the 36 000 net short position still too far from their target, while the Specs remained too bullish still? We have to wait a week for the next CoT to find out how the Specs reacted to this new attack on the price, which might not even be over as yet after Friday’s low close.

The threat of a short squeeze in silver remains and clearly the Big banks are scared. Therefore it would not surprise to find out this week that the price is to be forced even lower, perhaps to reach the situation exactly three years ago when the Commercials had a net long position of more than 5000 contracts – with silver then at $14.25!

The way things are going with the Covid-19 pandemic, there is something that really needs to be said. The first step is to listen to Tucker Carlson‘s interview with dr Peter McCollough (revisiting a video of dr McCollough made in May this year). Then search for news on India’s successful treatment of the raging pandemic there in April/May this year – especially in Uttar Pradesh where a population of 240 million people by August had new cases in low double numbers and deaths often as single numbers.

Then look at the chart below for what happened in Japan when infections with the delta variant caused a third wave of the pandemic that totally dwarfed their previous two waves. Japan had prided itself on how well they had survived the first two waves, which thereby primed themselves for a panic when delta went bonkers. From weeks in July with daily new infections well below 2000, they peaked on August 22 with 26 121 fresh Covid patients. No wonder they searched for a solution – one different from the US motivated global standard protocol which patently was not delivering results.

Their medical professionals had noticed that Covid had hit Africa in an interesting way – while the northern and southern parts of the continent were suffering badly under Covid, the equatorial region was almost free of Covid. This is where Ivermectin was widely being used against tropical parasitic infestation. On August the Japanese health ministry instructed all doctors to treat patients who had Covid with this medication.

From 26 000+ daily new cases barely more than three weeks ago, Japan was down to 6000/5000 new cases on Friday/Saturday. shows the three waves in Japan and how fast new cases were reduced once Ivermectin - a most safe and cheap medicine – was used for early treatment of Covid patients. The two researchers who developed Ivermectin received the Nobel prize for medicine in 2015.

Dr McCollough sounds quite adamant that suppression of early treatment of a Covid infection is the result of planned and coordinated action as we are about the ongoing suppression of the prices of gold and silver. There is one major difference between the two: suppression of the metal prices has undesirable economic and financial effects on many people, effects that could be severe and impoverish workers that cannot find any employment as mines remain less than fully profitable. The other one costs lives.

The officially recommended – and in some places enforced by law - protocol for the treatment of Covid cases is, “If you feel ill, go home, take something for the fever and only when you can no longer breathe have yourself admitted to hospital.” The treatment will consist of oxygen to help you breathe and Remdesivir at $3000 for a course (which has only low to medium efficacy). Then if your condition worsens, you will be placed on a ventilator (if one is available) and your prognosis will be poor. As Israel has been finding out, serious infection is possible even if you have been fully vaccinated. To find out more, search for the interview between dr P. McCollough and Reiner Feullmich of Germany on 13th June where it might still be available.

Euro–Dollar

Euro–dollar, last = $1.1724 (www.investing.com)

Just when the euro had rebounded off the bottom of bull channel PQRS to break above line D to look bullish again, the dollar started to strengthen again. One could wonder what had happened to cause the stronger dollar, but any such speculation has to consider the coincidence of threatened weakness on Wall Street and the problem the Big banks are facing with the return of bullish sentiment in the PM market.

Chris Powell of GATA long ago observed there are no free markets; only interventions. People who differ from this view nowadays have to scurry around to avoid mounting evidence that his might be a true observation. Coincidences can only be stretched so far before they become suspicious and open to questioning. Line S is being tested again and we should know this week whether the dollar can strengthen further.

DJIA daily close

DJIA. last = 34584.88 (money.cnn.com)

For some weeks now, evidence has suggested that there was a large Buyer active on Wall Street to step in and absorb any increase in selling that threatened to become a sell-off. Initially, the stock market managed to close up or almost square on the days when selling became heavy, which was almost every day. Then, two weeks ago, the sequence of losing days stretched to four and continued after one day in the green.

Weakness persisted and was only broken on the odd day when a sustained buying spree during trading hours reversed earlier weakness on the futures market to send the DJIA steeply higher – only to be softer overnight on the futures market as selling resumed. A decline of almost 1000 points since September 2 then settled in a narrow range for the past week as the Buyer managed to short sellers in a manner that would chip away at their capital through frequent rallies designed to trigger stop loss levels, before letting prices slide again.

Similar to what the Cabal is doing in the PM market, this intervention can last a long time, presumably with the Buyer making decent profit along the way while the Bears are losing capital all the time. This activity could nurture a pretty nice conspiracy theory, except that the short term charts support evidence of such a strategy.

Gold London PM fix – Dollars

Much like the euro, the price of gold also swooned as the dollar counter-intuitively became stronger again. The recent rebound off support along line Y had the price back into bull channel RS, but the weakness in gold last week has the price again below the channel and also below the support of line D.

It is clear that the Big Banks are not yet happy with their net short positions in the two metals and – as often speculated by various commentators – pressure on the price of gold is being sustained to add psychological pressure on the silver bulls. It really does need a long term view and a resolute mindset to sustain a bullish attitude and to hang onto one’s long positions in gold and of course silver as well.

Gold price – London PM fix, last = $1755.95 (www.kitco.com)

Euro–gold PM fix

As applied to last week’s comments on the euro price of gold, the weaker euro to a degree compensated for the lower dollar price of gold, but the euro price nevertheless again broke below channel RS. This is evidence that the price of gold did not merely react to a stronger dollar, but was suppressed to a greater degree. At least the euro price has held clear above the strong support of line E, but given current events in the PM market there can be no guarantee that this will remain so indefinitely.

Euro gold price – PM fix in Euro. Last = €1493.79 (www.kitco.com)

Silver Daily London Fix

Silver daily London fix, last = $23.01 (www.kitco.com)

The chart for “pitiful silver” appears to inspire confidence with the close near support of line X. However, the early London silver fix had silver testing $23, but by the time the US market closed silver was at $22.29 – further down by 82 cents. One can only hope that the Specs will over-react to this move, whether by a human decision to cut the algo bullish positions or by the algos themselves going into digital panic mode to go more short.

Perhaps the Commercials will reach a position where they no longer have to fear the risk posed by a short squeeze and decide to terminate their intervention and go long while the Specs are shorting the metal – with a prospect of this time profiting directly from a silver and gold bull market. This is grasping at straws, perhaps; but at least that keeps the spirits up during these exasperating times.

U.S. 10–year Treasury Note

U.S. 10–year Treasury note, last = 1.363% (www.investing.com )

The yield of the 10-year Treasury note rebounded off line S to settle in a sideways range between lines S and F. At the moment there is little prospect of a change.

West Texas Intermediate crude. Daily close

Last week the price of crude oil broke back above the $73 level. It is not clear from the available evidence whether this move high is driven by increasing demand or a drop in supply. Given that the current administration appears to be pro-managing climate change and against use of fossil fuels, the odds may well favour a decreasing supply – perhaps coupled with other changes in the general economy.

For now the trend is bullish for oil, but the price has to break clear above the recent strong resistance along lines B and S before the trend will be confirmed. That would probably also mean a break back into bull channel KL for further confirmation of the trend.

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