This morning’s trade in silver demonstrates a pattern regular observers of this market will instantly recognize.
This pattern happens so frequently that any claim by the CFTC that they couldn’t get to the bottom of this sort of crap is just nonsense.
But we have a pretty good idea why the CFTC closed it’s investigation. How can you bust the government that your agency is a part of?
We see the firm control of manipulation algo patterns operating in the early morning hours both yesterday and today. Then, we have a flash crash running of the stops going into the COMEX open, which has been a one-two punch set-up we’ve seen countless times. The only thing different today is that there was more low hanging fruit to harvest on account of gold and silver speculators fearful of what a government shutdown could mean such that these speculators were operating with tighter stops.
This was furthered by the fact that support levels informing the views of these technical analysis dependent speculators were targeted and blown out of the water by the fast crash algo manipulation.
2:05 p.m. EST UPDATE:
Who let the dogs out? “The Doc” over on the Silver Doctors asked an interesting question following this morning’s flash crash. “Did Bart Chilton Predict Today’s Gold & Silver Smash?” Chilton did note on September 20th: “Under a shutdown scenario, government regulators will be handcuffed in our ability to go after crooks who are trying to evade our oversight and protection of markets. You can bet the “do-badders” are licking their chops.” Making the statement even more interesting is the fact that David Meister, head of enforcement at the CFTC announced yesterday that he’s leaving. He has been following Chairman Gensler’s career moves for some time and many speculate that Meister is jumping ship because Gensler appears to be on his way out at the end of the year given the end of his five year term.
All this said, I don’t think Chilton was even thinking about his warning in the context of the 24 hour period following a partial government shutdown. But that’s just a hunch on my part because it would be more logical to fear the 30-day window, not the immediate aftermath. But more to the point what we are seeing today is no different than what we’ve seen countless times. First, we see the firm control of manipulation algo patterns operating in the early morning hours both yesterday and today. Then, we have a flash crash running of the stops going into the COMEX open, which has been a one-two punch set-up we’ve seen countless times. The only thing different today is that there was more low hanging fruit to harvest on account of gold and silver speculators fearful of what a government shutdown could mean such that these speculators were operating with tighter stops. This was furthered by the fact that support levels informing the views of these technical analysis dependent speculators were targeted and blown out of the water by the fast crash algo manipulation.
Further anecdotal support for this thesis can be seen with the US dollar cross. Against the main index, the dollar has traded in a very tight range. Bonds are trading as one would expect; they’re getting a short-term parking spot flow of money, with the US Ten Year bond up 1.22% in price at just before 3pm EST, but the move, combined with the action in the dollar and a rising stock market is hardly the sort of intra-sector action one would expect on a day with gold down as deeply as it has fallen. Meanwhile copper is higher after only dipping briefly as precious metals dived. It’s only the precious metals complex and to some extent oil that’s taking heat. If you’re a central planner most fearful of reactions to huge debt burdens and interest rates in the wake of a government shutdown, you’d target precious metals and oil.
Again, this has happened countless times before. While the lobotomized lame-stream media likes to proffer arguments that a government shutdown is bad for precious metals, nothing could be further from the truth. In the intermediate-term the debt ceiling will be raised and eventually, the fight over Obamacare will be resolved one way or another.
If you’d really like to dive into conspiratorial pondering, consider the following framework of analysis. The banker oligarchy in the West is most interested in having no checks against its installment of a fiat debt based monetary system. That system is under attack directly by the BRICS, and by default given that the system has now grown through the process of financialization in the shadow banking system to the point of destabilizing EVERYTHING. These greedy bastards are in the fight of their lives just to buy time, lest interest rates slip out of their control, the interest rate swap derivatives market blasts higher and crashes the global economy. The fight over the debt ceiling has a known outcome at a probability level well north of 95%: it will be raised. But the instability caused by the fight itself is dangerous to interest rates, the interest rate swap derivatives market and even the credit default swap derivatives market.
Since 2008, all the Western economies have done is paper over the financial system’s problems with even more derivatives crap and even more consolidation among the too big to fail financial institutions. We are more sensitive to interest rate destabilization than at any other time in living memory. So, the US Government is forced to partially shut down and gold and silver, the smoke alarms for the interest rate markets and more get bombed? Well, duh… As if these idiots had an alternative SHORT-TERM option? The don’t.
It’s absolutely revolting what’s going on. Bart Chilton, you can see it to. Your cohorts at the CFTC never could deal with the silver and gold manipulation issue from day one and surely you must understand that now. Do the right thing, Mr. Chilton. The American people will support you if you only ask for their support. But no teasing this time. You’ve teased at least twice in the media, stating you would make statements if the CFTC didn’t. Well, the day has arrived. Claim your rightful place in history, Mr. Chilton.
As for you, dear reader, if you haven’t read the letter to Mr. Chilton yet posted here, what are you waiting for? Click here and read it. Sign the petition. You have nothing to lose.
– Eric Dubin
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Quite often, the talking heads on CNBC and Bloomberg like to ridicule those that point out precious metals market manipulation as nothing but tin foil hat nutters. But these very same media outlets are happy to give airtime to money managers that base their decisions on technical analysis and pattern recognition. Sad.
This morning’s trade in silver demonstrates a pattern regular observers of this market will instantly recognize. We have trading confined to a pattern that closely matches the swings exhibited during the same rough period of time during Monday’s trading. Furthermore, Monday’s spike higher happened as the London market was moving to close and the setting of the “PM Fix,” the establishment of the official close of market quotation for silver. That price serves as the primary settlement price for the vast majority of physical bullion traded globally and to see the price rocket higher going into the close is symptomatic of a tight market. Someone wanted physical via the LBMA exchange and satisfying that demand required a higher price and a temporary cessation of the manipulation algorithms governing computer trading earlier in the morning.
This pattern happens so frequently that any claim by the CFTC that they couldn’t get to the bottom of this sort of crap is just nonsense. All they have to do is pull the trading records for all the days like this over the last few years and look for patterns. With that as the bedrock to an investigation, still further evidence would be easily obtained because which doors to knock on would be known.
But we have a pretty good idea why the CFTC closed it’s investigation. How can you bust the government that your agency is a part of? How do you “out” what amounts to a national security policy governing the manipulation of precious metals in service of support of the reserve and trade status of the US dollar?
Are Kitco.com readers going to have to slog through yet another Jim Wyckoff “explanation” that refuses to deal with the clearly visible algo trading manipulation this morning? Probably. It’s just shy of 6 a.m. EST and we’ll have Mr. Wyckoff’s first missive in a few hours. Meanwhile, don’t be surprised when silver and gold firm-up going into the London PM Fix.
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If you missed our publication of an open letter to CFTC commissioner Bart Chilton, read it. Click here.