SD Weekly Metals & Markets 3/23: Cyprus is Lehman & MFG- Financial System on the Edge!

Youtube SD WeeklyEric Dubin & The Doc break down the trading action in gold and silver and preview next week’s options expiration in the metals.

We discuss the implications of the Cyprus bail-in, whether bank runs are imminent in Greece, Italy, & Spain, and the likelihood that a full-blown contagion has been triggered due to the loss of confidence in the banking system.  

SD Weekly Metals & Markets is below:


2013 Silver Eagles IN STOCK As Low As $2.59 Over Spot at SDBullion!

 

      1. Gold & silver price Re-cap:
        Silver closed at $28.76- basically unchanged for the week
        Gold closed at $1609, up roughly $25 for the week

        1. Signs of probable SILVER short covering w/ Thursday morning pop higher on Comex open;  GOLD was moving higher earlier in the week on fear of banking sector contagion

        2. Friday trading:  Can’t have strong trading and testing of GOLD’s upside resistance at $1620 and $29.50+ SILVER going into the weekend and with Cypress still unresolved;  GOLD hit before COMEX open;  SILVER hit on COMEX open – probably new shorts.

        3. SILVER has three tests of $29.50 in the last two months, each failing a few pennies lower each time;  meanwhile, the bottoms are rising a few pennies higher each time.  Range tightening.  Normally, given fundamentals, one would expect upside breakout but….

        1. SILVER Options Exp. Next Week:  Heads-up, short-term!

silver

      1. Cyprus
        -Banks closed through at least Tuesday
        -ECB enacts capital controls, will keep Cypriots savings accounts frozen even when banks re-open, and reduce ATM withdrawals
        -Cyprus as Lehman Brothers & MFGlobal rolled into one
        – Spain, Portugal — bank runs next week?..

      1. Jim Sinclair Meeting
        -Cyprus a major misstep for the IMF/ECB
        -Western Central banks testing policy shift from quantitative easing to bail-in wealth taxation.
        -Spain has reportedly just changed constitutional rules to allow depositor haircuts
        -New Zealand is attempting to pass legislation that depositors would see haircuts in all future bank failures
        -2 years to withdraw funds from IRA/401k
        -silver to pass $100, will not reach $500, will have an orgasmic like rally and subsequent crash;  SILVER not monetary metal per Sinclair and on this score, he’s wrong and silver will not likely crash – just huge volatility.

      1. FMOC meeting:  Same old MOPE story

        1. note 4 year pattern of stronger econ in 1st half
          -Uncle Ben:  “green shoots” mid 2009
          -Uncle Ben:  “we have exit strategy” WSJ editorial, summer 2010
          -same pattern this year – strong in first half
          -QE programs primarily launched Fall/Winter
          -2013 Economic slowdown later in year
          -Exit strategy:  nothing but jawboning given Fed purchase of over 50% of Treasuries