The gold price was traumatized yesterday by the Gold Cartel's forceful raid, plunging right through important support at $1,270 all the way down to $1,260.
While a technical breakdown was created, enough buyers showed up to take the price back up to a touch away from $1,270 through the early London trading hours. Efforts to break through that former support point were thwarted twice. Then it was pressure on a couple hours ahead of our Comex opening ... which took the price back down to $1,263.
The effort to keep gold off the investment radar screen in the east is at play, made even more noticeable with bitcoin gaining mainstream headlines with a move through $12,000.
Fast forward -- make that bitcoin approaching $13,000, receiving Alan Greenspan's comments on CNBC today. Of note was the CNBC host saying the rise in the price of the cryptocurrencies is a result of the proliferate quantitative easing by central banks and the desire of investors to get some of their money out of the system.
Obviously one of the major goals of gold and silver investors has been to do the same, for that very reason. But because of the blatant price suppression, our efforts have been thwarted, revealing just how extensive the manipulation in our sector really is. The bitcoin phenomenon is a tell of what the precious metals are going to do in the future due to an inevitable inability of the Gold Cartel to continue carrying on such as they are.
Can you imagine the uproar if gold traded anything remotely close to bitcoin? What do you think the headlines would be in the financial pages? Perhaps this is a reason the precious metals are under the Gold Cartel's thumb like never before. Bitcoin they can handle, but not confirmation of its move by gold and silver following suit.
Silver still cannot get out of its own way. Recoveries above $16 yesterday afternoon and overnight went nowhere. It wasn't that long ago that talk was about a silver magnet at the $17 level. Just like that a new one seems to have been planted at $16.
Gold's AM fix: $1,268.55. The PM Fix: $1,263.70. The silver fix: $16.1150.
The gold open interest fell 611 contracts to 472,795, but the silver open interest rose 2,915 contracts to 192,970. The coming commitment of traders report on Friday ought to reveal whether JPMorganChase and Gang are pressing the case on the downside or whether the horrendous price action has brought a sizeable amount of specs to the short side.
Speaking of silver, some input via Dave from Denver:
"Based on the last commitment of traders report, it looks like the banks might be starting to cover their shorts and the specs are unloading longs and adding to shorts. But it was small amounts. We'll have a better indication after this Friday's report.
"Here are the two big questions:
"1) The cartel capping of the metals is the most intense I've seen in more than 16 years of following the sector. Why?
"2) If bitcoin and cryptocurrencies are what the cryptocurrency bulls say they are -- 'the new gold' -- how come central banks tolerate them and are not including them in their reserves?"
From James McShirley this afternoon:
"The siege is on, and for whatever reason silver is absolutely being held under water, with no ability to even catch a single breath. As if the lunacy can't get any more intense, it now takes 750 ounces of silver to buy 1 bitcoin and 1,512 ounces of silver to buy 1 Dow unit, and the silver/gold ratio is fast approaching 80 to 1.
"If ever there was a commodity that is a screaming buy, this should be it. A quick check around the cartel horn, however, shows every cartel rule firmly in place. The New York trading hours have become Death Valley, and the PM fix is an assured loser.
"The silver open interest situation is fairly astounding. Silver open interest is going nuclear with a staggering 193,000 and growing. Why would you be piling on shorts down here unless you were a sovereign with no regard for profit or reality?
"I hope whoever is getting the cheap physical appreciates the gift.
"Thank you, pathetic mining companies, for cheerfully allowing the plunder and pillage of your business.
"The silver relative strength index is now in the 20s. You'd think a relief rally is imminent. On the other hand, I thought a relief rally would happen over a dollar ago when silver was $17. If silver ever gets away from cartel control it will make bitcoin look modest." ...
... For the remainder of the commentary:
www.LeMetropoleCafe.com
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