gold, silver, the ratio, platinum european fears, and central banks

response to your question

Traders in general bet very bullish at tops and bearish at bottoms due to the way there algorithms and trend follwoing tools are in place

GOLD

many traders got hurt buying gold all the way down and had to blow out under 1550

1530-1550 area is being called a range bottom with intermediate resistance at 1642 then 1699-1718 then 1777-1800

GLD and SLV investors have held strong thru this downturn as shares outstanding have remained within 5% of the all time highs

Large upside call buyers have been placing huge money bets that between now and April 2013 will will be over 2000, specifically 2000-2100

conclusion from this is that ALGO's/Quants/Machine traders, etc have gotten destroyed over the past few months buying tops and selling bottoms

SILVER
more traders are warming up to silver as gold has made a clear move away from its low

silver traders are staring to believe that this could be an "inside range year" of say 27-37, we are at the lower end of the range

option players have put decent premiums back in the upside calls meaning they are just as scared of silver going to 35 as they are 25

large option funds selling downside puts to buy upside calls around the 20 level and the 35-37 level, generally struncturing ideas that will get them long at 20.0 and really long between 35 and 37 (this years highs)

silver futures spec open interest is amonst the lowest in ten years, which has generally signified a bottom

PLATINUM
Largest evry open interst in COMEX Platinum was June 1st, 2012 primarily Spec short, that has decreased by 35 percent in two weeks meaning that platinum looks like it is eting a range of 1390-1740

IMPLATS, the 2nd largest Platinum miner in the world, in Rustenburg ZA has been experiencing supply disruptions as workers strike for better pay and working conditions, also the ZA govt is cracking down on illegal immigrant workers coming over the ZA border to work for Implats. This is going to cause a decrease in production this year of at least 16% worldwide.............to counter that though European demand will be down too, due to the ongoing finacial crisis there

many traders have tried the old buy PL sell GC trade they always get forced out at bad prices like 180 credit, eventually that spread should come back in line where PL is 10-25 premium to GC bu that does not look like it is in the books now. I f a supply disruption can't bid up PL not sure what will

I hope spell check worked, and this is more useful, sincerely........qsilver007

 

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Either way i was going to post this a week ago but was tied up i would advice anyone to stay away from PMs for a bit till we have better picture of Euro crisis, Gld/Slv can easily test their 52 week lows depending on what happens in Greece.

 

The Euro was finished a long time ago. What remains is how long they can keep hiding it by creating debt that can never be paid back. In regards to Greece, it doesn't matter who gets elected. They can never pay their debts and the people won't tolerate any further pushed into austerity.

 

I do think that gold prices are being held deliberately low. This is coming however a the cost of what seems to be great amounts of gold flowing from the west to the east. China has been quietly buying unprecedented amounts of the stuff while prices are low. It's amounting to multiple 10's of tons of gold each month.

 

silver trends

All this is quite interesting. Because I keep a complete set of Silver Eagles each year I buy one to update the set and keep it complete.
This year in January I got a new 2012 ASE for $38.50.
Some dealers were asking $39 and $40.
Anyway as we know silver went down and they were priced at $34.
Last Sunday at a coin show I had a chance to buy random years ASE in those Littleton holders for $31 each. I like the Littleton display holders and was tempted to buy some but passed. My thoughts were- Well already have some of those plus several other raw ones and my complete set 1986-2012. Maybe I'll get stuck holdng the bag if silver drops further.
To get to the point, any buying now by me would be purely for hoarding and possible speculation.
In this thread one post advised to stay away from silver and gold now. And I know enough from past history not to sell now.
So I guess my question to the metals traders here is this:
With prices at about $28 to almost $29 per troy oz. for silver are you buying? Are you paying $32 or $34 for silver eagles? And if you are not buying now tell us why. Thanks.

 

PROFESSIONALLY WIDE LONGER DATED CALL SPREADS GIVE YOU A TREMENDOUS BANG FOR YOUR BUCK iif you like futures the sep 30/35 call spread and the dec 32-40 are good choices
etfs similar stikes different months january is very popular with etf players

as for europe and selling metals down here?
buying silver with a 28.00 handle is very friendly

there is not really that much uncertaintity in europe if you dig deep into the situatution, the ECB has already stated thatey have created a 1.6 trillion euro bailout fund which they will lever up to 4x
thata 6.4 trillion euro or 8 trillion dollar based on the last of 1.27

europe will survive just as we did in 2008

the only question is how many euros will it take to keep the financial system a float temporarily, at least 8 trillion according to ecb.............they call this essf, we called i tarp, talf, qe, blah ,blah, blah...........in the end euro, yuan, rupees, dollars, pounds are all going to be created at a quicker pace.........Bank of NEgland just said they are going to do more stimulus...................ill be the first one to say this year will be a bumpy road going forward.

there will be few straight shots up like last year.

people using too much leverage will get blown out just like they did on friday june 1st

stay nimble buy small on dips and if you trade its easier to use options in this environment as you can script you PL to different scenarios

when all the eruos move thru the system bonds will be yielding so little PM will be a more obvious buy, but once everyone is in the boat its kind of too late

i said before and i ll saay again this is shaping up to be an iside range year silver 27-37 and gold 1530-1800 what you do with your investments is you own choice and i would wish each the best of luck have to go into work now at least i had my first fatehrs day with the son. will check back in with you all in a few days...............................qsilver007

 

I stopped reading when he didn't capitalize January. I won't stand for it, it's outrageous!

 

Well then you missed friday june 1st! LOL
Seriously some of this stuff is informative.
Just wonder what it all means to a common coin collector or someone not into the stock market.
There was once a guy on this forum from Texas making some wild noise and claims for a few days. I started to PM him and he held off for a while talking everyday coin things.
But then he started sending messages trying to sell me bullion
gold eagle half ounces at rediculous prices. Turned out he was a sales rep for some marketing firm around Dallas.
So now I choose carefully who to listen to.

 

People, I think qsilver007 just happens to not speak English as his first language. But I guess letting your paranoid delusions run crazy because he misspelled something is more fun. So weird you people are.

 

A very interesting thread.

Thanks for sharing your perspective, qsilver007.

If silver does head lower, I would be looking to sell SLV puts and using the proceeds to buy calls.

 

Thanks for sharing your unique perspective qsilver007. I agree with a lot of what you've posted, but would add BitCoin is another currency without a central bank which is a big part of why it has any traction. It was a challenge to read it all though. I am reminded of the Churchill quote "The length of this documents defends it well against being read".

More money will need to be printed to keep the debt and derivatives bubbles inflated, and all fiat currencies are in a race to the bottom barring fiscal responsibility. I wouldn't be surprised to see gold and silver denominated in USD go lower if the European situation falters, but any benefit would be temporary IMO as the counter party contagion risk would impact banks in the US as well. I also think it would be difficult to find silver at $20/oz. Any new low would incite buying of physical metal even if the paper price keeps going further down. Sure it will be out there, but few people will be selling physical for that price except the companies that are hedging, and I doubt they'd have much in stock. Plus hedging will only be viable so long as banks are able to remain capitalized otherwise those avenues will be limited and we may see more MF Global type situations.

The European situation is also bullish for gold because it will be in higher demand during any currency transitions. Athens alone has thousands of gold dealers, and the people who can't afford gold will go for silver. I don't think the GSR will benefit silver until prices begin to rise again, and the further the rise the greater the benefit. This seems plausible as a delayed effect (as more people get up to speed and on the bandwagon) from a possible deflation scenario since the further the price drops the more that the physical supply will decrease and could make the price go higher than otherwise if low prices actually cause a supply issue. Lots of ifs...

 

Did you forget the Chuchill quote by the second paragraph?

 

All I read here is a lot of far out speculation. Can anyone honestly say with a straight face that bullion is the answer to the world's financial problems? If it was I can guarantee there wouldn't be any available for personal investment because the world's central banks would own every last ounce of it, and would hold it. Because this is the opposite of wht is really taking place, I find it difficult at best to imagine the benefits.
Guy

 

If the world moved back to a gold & silver standard, why would central banks exist?

 

Whoa.

 

Holding some gold & silver is an insurance policy against inflation or (worse) fiat currency collapse/disintegration.

 

As with any term of measurment, it's all relative.

 

I can and will say it with a straight face. Monetary standards based on metals have self regulating policy due to the supply limitations not in place when money can be fabricated from nothing. It would have prevented the debt bubble we have. It would have prevented massive spending on wars, nation building, and infringement upon national sovereignty of many nations by the military industrial complex. It would have prevented insolvent institutions from snuffing out free market competition by granting government handouts. It would have enforced fiscal responsibility by only allowing us to live beyond our means to the extent that we have creditworthiness and are attractive to other nations for loans. If the central banks owned all of it there wouldn't be any for the rest of us, and the price would skyrocket to meet demand.

 

All I was looking to do with this post was to enlighten some people, and give a WS perspective, you can laughat my spelling and grammar, I am a big boy, I can take it. As for guarantees, in investments, there are none. All I do is qualitative and technical trading. Gold and Silver are the only real money, always have been always will be. Europe is not fixed nor is the US.

The world is laden with debt, and cheap money, and money printing will only accelerate over the next few years.

From a trading pespective Silvers low's have been higher each time, 26.75, 27.15,27.25, 27.50, 27,83, 28.02. Like it or not once/if it gets thru 29.02 it will challenge 30.00. With all the algos now short on the lows if it breaches 30.00 on the upside 31.50 and 33.00 shall be the next targets. Can it go down form her, ABSOLUTELY. But I will go back to the huge call buys in DEC 2012 and JAN 2013.

Most intelligent Central Banks have been cranking up Gold reserves at parabolic rates in the past siz months. Turkey, China and Russia mainly.

My opinion as a trader is that 1528 and 26.75 were the year lows. They were very close to triple bottoms from Sept 2012 and Dec 2012. Each time thereafter Gold was 1700 and Silver 34-37.

No guarantees in life. No risk no reward.

just my thoughts have to go to work check in with you guys in a few............qsilv

 

The question in my head is why the short positions in silver at JPM and why does gold seem to be artificially low? Someone else mentioned the massive buying of gold by China. Why? Someone else mentioned that central banks would be buying gold/silver if we would return to them as a currency backing.....well someone else correctly asserted that central banks wouldn't be if gold/silver were money. Fiat currency is backed by faith and by liabilities, specifically faith in repaying said liabilities with more fiat or possibly tangible collateral. Fiat money cannot exist indefinitely, gold and silver or other tangibles are bound by physical laws to exist only in physical form, you can't make any more than that which exists already in nature (though you could find/mine more thus affecting supply somewhat).

There isn't enough gold/silver to use as currency all around the world to replace fiat. I think some 6 trillion dollars worth of gold exists today, which is but a small piece of the world's economic pie. A "tangible standard" consisting of gold/silver/platinum/etc could exist if the world held enough of that wealth but I don't know the specifics of how. The fiat currency will fail when they want it to. I can't wait personally. Fiat can be manipulated too much and only the people 'in the know' are privy to useful and profitable information thereupon. I believe in equally protected natural rights and the right to a fair and impartial financial system.

Inflation is theft.