If markets are again predicting more QE, the metals will come under pressure under another disappointment only offset by those who know, QE III is not only underway, it is substantially bankrolling the Europe bailout indirectly. It's smart money versus the little guy, and the mine fields, if this week portends the same the last time, is the FOMC meeting in which no new news is not good news, and the Bernookie kerfluffle the next day.
I figure that, along with the new mine deal probably announced 22 March along with 4th QTR results, will weigh on the downside for SLW. All the other upside? Too well known to repeat.
With some expected inflation at the CPI and PPI, the Bernank has already tipped his hand: the expected pop in CORE and "real" inflation will be tolerated so that housing can bubble out of the hole banksters put us in 2003-7. Housing needs to come "back" to at least 1/2 the pop of 2007--worth $400K in 2004, worth $600K by 2007--now $375K, needs to become about $495K--call it minimum, ten to 12 years from 2008, allowing 10 years of loan paying, you'd be able to sell without coming up with money out of pocket--barely.
And of course, all that fiat they're printing in your stock account, they expect you to give it to the banks. See how that works?
Quadruple option expiration makes for a noisy week next. GLTA.
Monday Mar 12
4-Week Bill Announcement 11:00 AM ET 3-Month Bill Auction 11:30 AM ET
6-Month Bill Auction 11:30 AM ET 3-Yr Note Auction 1:00 PM ET
Treasury Budget 2:00 PM ET
Tuesday Mar 13
NFIB Small Business Optimism Index 7:30 AM ET ICSC-Goldman Store Sales 7:45 AM ET
Retail Sales 8:30 AM ET Redbook 8:55 AM ET Business Inventories 10:00 AM ET
4-Week Bill Auction 11:30 AM ET 10-Yr Note Auction 1:00 PM ET
FOMC Meeting Announcement 2:15 PM ET
Wednesday Mar 14
MBA Purchase Applications 7:00 AM ET Current Account 8:30 AM ET
Import and Export Prices 8:30 AM ET Ben Bernanke Speaks 9:00 AM ET
EIA Petroleum Status Report 10:30 AM ET 30-Yr Bond Auction 1:00 PM ET
Thursday Mar 15
Weekly Bill Settlement 3-Yr Note Settlement 10-Yr Note Settlement 30-Yr Bond Settlement
Jobless Claims 8:30 AM ET Producer Price Index 8:30 AM ET Empire State Mfg Survey 8:30 AM ET
Treasury International Capital 9:00 AM ET Bloomberg Consumer Comfort Index 9:45 AM ET
Philadelphia Fed Survey 10:00 AM ET EIA Natural Gas Report 10:30 AM ET
3-Month Bill Announcement 11:00 AM ET 6-Month Bill Announcement 11:00 AM ET
10-Yr TIPS Announcement 11:00 AM ET Fed Balance Sheet 4:30 PM ET Money Supply 4:30 PM ET
Friday Mar 16
Quaduple Witching Consumer Price Index 8:30 AM ET Industrial Production 9:15 AM ET
Consumer Sentiment 9:55 AM ET
Friday quadruple witching meets consumer sentiment, that last number is important, newly important I may add compared to scoffing critics the last twenty years.
Because sentiment has been "recognized" as psychobabble indicator #1, you can see how the market wants to go "up" generally, if it is looking for sunspots to make conclusions about market directions.
Today, silver will flirt with important averages, and the real action will be tomorrow Friday as the program traders decide to push which button when.
Silver is off 1% as market risk allegedly decreases--and bonds are selling off, so, where is the buying pressure on stocks? It's not a tear, just a hair, and builds as the day goes on, but you get the feeling bonds have lost allure considering what happened in Greece.
As bonds sell off, yields go higher, which means the Fed will have to adjust its short term for long term buying spree, to continue to pressure the 10 year rate affecting home loan and refi's.
I remain defensive on SLW, due to 22 March CC and projected deals, which we haven't had in two years. Deals surface when silver flucuates down, this is a dilutive event unless SLW can get a stream immediately productive, a la Barnes.
I guess we'll see.
Jobless claims down, but did I see .7% (8.4%) annual PPI inflation stuck in there amongst the gobbledegook?
But there's no inflation so, sell your silver and gold and buy more dollars, which inexplicably have seemed to stall out last night after a 7% pop this year.
I'm shocked. SHOCKED!
Talk about painting the tape. Bicycles anyone?
This week is a monster, and it's a market that wants to hear good news and is getting plenty.
Here's the way it sets up for the rest of the screenplay: Bernookie comes on after we get a load of a popping CPI to tell us, don't worry, that's the inflation he said he'd tolerate so we can destroy the dollar at the rate of six percent per year for the next five, so we can reflate housing to the prices that died in 2007.
Ok, he won't say that exactly, but it will be pretty much the same thing. That ought to set us up for the next run at triple point Dow, and give those technologists a shot at "we're "embedded" above 13000 and sky's the limit.
Silver will take a little off for the absence of risk, or the appearance of the absence of risk, and put a bunch on later in the day on its industrial side.
Friday's CPI will be more of the same, but we're used to that from Thursday BS session. You'll notice today that the Germans were publishing fluff pieces about solving Greece's near term problems more robustly than they'd hoped.
What a line! I haven't seen this much world wide choreography since Yankee Doodle Dandy.
Will it "work"? Well why not? I always liked David Copperfield.
Silver continues to sell off Wed night overseas on the absence of "risk" as the world makes believe it is getting "better", which is like pancake makeup on a Walking Dead zombie. The PPI/CPI pop this week Bernookie alluded to as "temporary" will be in the realm of an annualized 4.8% imho, but will be jawboned "away" at 0900 as the Bernanke kerfluffles about its "temporary" nature due to "gas". Talk about walking dead. And these are CPI/PPI where they've taken out most of food clothing and shelter from the equation. Pencils are getting cheaper tho.
Well there's a lot of "gas" going into the market, but as long as lemmings follow, there you go. Futures are once again flat as a board, silver is off as much as 1.5%.
As usual, first the risk equation leaves PM, then the industrial side ramps it back to where it once belonged. (oooooooooooooooooooooooooo)
Max Pain is at $35 for SLW for Friday, spikes to 37 for the next option time frame, and settles back to $35 for the rest of the year. A rash, good phrasing that, of challenges abound PM as the dollar has improved a whopping 7% from the bottom. The US emerges as cream of the crap.
Our presence in Afcamelstain and Iraq is drawing to a close. Our devil's bargain, pay for oil using petro dollars, made with Slobby Arabia by Nixon, allows us the meager value of 11 cents on the dollar since 1971, up from 10 cents.
Judicious selling of calls at strike, and just above? turn this into a 26% annual yield-er.
It's something to think about while all this kerfluffling proceeds.
Yeah, SLW kept going up this morning completely ignoring the fact that POS is red. Never seen anything quite like that. I thought we are following the dow for the industrial side. Then why the drop in the afternoon after fomc met? If we are following the dow in the morning, then we shouldn't dump the shares because the news is not in favor on the precious metal. What kind of traders are they? Just speculating for speculating's sake?
Business optimism soars with reservations, says the news. I'm confident but worried?
Flea market crapitallism is survival of the fittest, when wouldn't it be prudent to be paranoid?
We start with "turnaround Tuesday" up a 1/2 % general market, and flat as a board with PM and SLW a few pennies to the good. Looks like Greece is getting its first dollop of cash before 20 March, so they can return it to bondholders at 50 cents on the dollar, still about 10X too much, but IMF stuffed a dirty sock into that sucking chest wound for now, while the Germans rightfully complain structure change is needed for Europe.
We get the 1.1% snap in retail mostly autos, so there's the follow thru, but a lot is due to the price of gas, which Bernookie said was a fleeting issue. Not that that is a good thing, but the market heretofore took gas pains as necessary in a "growth" economy. There is no growth. There is only the 6% annual degradation of the dollar. So how the market views that half is problematic, but, any excuse for "up" is a good one.
They've kicked off the FOMC meeting, that isn't the issue. It's the Bernookie kerfluffle tomorrow that will hearten or scare PM investors. We get the same old same old--so--is SLW going to pop or drop?
Methinks flat as a board, but for general market moves. New deals, and expanding production, are what counts these days. What is, or isn't baked in, is to be seen.
Yeah, I think we are making a shoulder right now. This is the 2nd week. As long as it's a shoulder and no more deep drops I'm ok with it. Hate to say it, but I think we'll rise on bad industrial news. Mostly the dollars. Last night saw some charts on dollars looks encouraging.
And... they're off...and it's retail sales at 0830. retail sales 1/2 cars, 1/2 "the rest", cars are booming (aluminum use is skyrocketing AA fans), and the dollar is gaining on the outside, dollar gaining, Pac Rim soaring, as destruction of currency is coming up your rear, coming up your rear, it's a yen for destruction of currency.
Now just before lunch, everyone takes a breather in the backstretch, no not your brother on the phone with that list of phone numbers lost by Sigma Phi Nothing Sorority, it's FOMC notes at 2:30EST, 2:30 EST a drag on the market, drag on the market--no QE3 no QE3 and tho it's no surprise, no surprise as we round the end of day, tomorrow's race is the Bernookie Put at 0900 AM EST, smothering the market with mush words and no QE3, no QE3, and "toleration of inflation" with low irates till end of '14 (I mean '18), low irates against no QE3...
and the winner is
all the longs who sleep through this entire mess.
Wake me option expiration.
Yeah "(aluminum use is skyrocketing AA fans)" I'll send you an ALCOA sweatshirt. I have a sweatshirt of my ID, but I am afraid to wear it. If Aloca hits the fan we can both go live in the mountains. That should not be a problem since I can't remember anything other than direction on a few occasions where I disagreed with you. I trade AA, I never hold it very long.
No I haven't. Thanks for the recommendation. My suspicion is it's going to be just like the currency war.
slw is behaving strangely today. The rise at the opening is with big volumes. And we are out performing gold. It's strange.
I know you don't like shorts, but when you see an anomoly like that, you might try taking a position in put option below the money, with no time premium. They'll be at their lowest.
Then as the stock declines to "catch up" with the POS, you get rewarded. I'm talking hedge, without surrendering your long position.
There are option trading books you can take out at the library and explanations of strategies if you'll google them, and they are free.
Slow news day, note auctions precede the cringe in front of the FOMC notes, and Bernookie kerfluffle on Wed morning. Those hoping for an announced, rather than stealth QE3 are in for a disappointment. Not even a low irate stretchout till 2018, which is required, to inflate housing above drowned loan levels.
The eco is improving, retail will show some gains borne of decrepit dollar devaluation, and naturally, best selling hotties in the home market are $700-$1.1M homes. Usually, lower price housing leads, this time, the few, the rich and the bankers are out in force. Might as well, the corruption of the system is old news.
Hopefully those big buck homes are being sold to more than 2 earner, both McD employed partners in life. Don't look for any relief on the political front--one Party has a candidate worth $200,000,000 he thinks speaking engagements for $400K are chump change, the other guy needs more poor people he calls--voters.
Talk about a rock and a hard place.
SPAM bastids out big time. You can tell when the volatility rises, the mark of the spam sellers is, the weak hands will jump to any authority, so sell that spam! That's when those guys are primed to pounce.
I use it as a volatility index. I think we finish the week at $35 and change.
I don't even speak finnish.