With Gold and Silver Hit Hard This Week On The Fed’s Rate Hike Threat, Craig Hemke Joins the Show, Discussing:
- Support at $1250 & $16.50: Will Gold and Silver Hang In There?
- THIS IS THE HAMMER – Chinese Buy Barclay’s 2,000 Ton Gold Vault Built in 2012
- Why Won’t Anyone Stand For Delivery and CRASH THE COMEX?
- Fundamentals Snap the Game!: “We’re Shaping Up For Something That’s Going to be MONUMENTAL”
- New Bull Market Is SNORTING – Institutional Investors Are BTFD!
Doc, Dubin, & Craig Hemke Break Down All the Action In a Critical Market Update:
Handicapping the antics of Fed “jawboning” with Craig Hemke is always great fun, and this week offers a target rich environment. Despite market turmoil, Hemke makes the case that the minimal damage we’ve seen since FOMC minutes release is the sort of trading one would expect from the new and unfolding precious metals bull market.
Gold found support this week at its 50 day moving average and the mining shares continue to brush aside cartel antics like Yellen and company are nothing more than annoying gnats.
The lion’s share of this week’s show handicaps how precious metals have been trading differently in the face of efforts by central banker masters of the universe. We’re not out of the woods yet. But without a doubt, precious metals markets are trading differently this year, and the bull is alive and well.
Isn’t it rather amusing that the same FOMC meeting can be spun in multiple ways? The April Federal Reserve confab included ample opportunity for “jawboning” via the official statement release. Federal Reserve officials made multiple appearances on the rubber chicken circuit and made multiple statements to the media that week and subsequent weeks. The tenner of Fed messaging has been more dovish than not, and this built upon Janet Yellen’s surprisingly dovish comments to Congress earlier this year; Yellen went as far as to warn that the Fed couldn’t rule out negative interest rates.
Fast-forward to this week and the minutes of the same April meeting are now cherry-picked to emphasize risks that going-forward economic data remains supportive of interest rate normalization (stop laughing).
Truth be told, the rate of the U.S. dollar’s April decline likely factored in Federal Reserve (and Treasury) thinking. At the close of April, the dollar was in a world of hurt and on May 3rd, the first trading day of this month, the “DXY” dollar index spiked down to 91.88 on an intraday basis. A concerted effort to switch that trend was put in place.
By last week’s SD Weekly Metals & Markets, with the DXY having hit an intraday peak 94.845, I could see the effort had run its course and that’s why I forecast that DXY 95 would not be breached and that we were going back down.
That is exactly what started to happen early this week. But the Fed put a stop to that dynamic, and with the added spin of Wednesday’s FOMC minutes release, the DXY leaped to an intraday high of 95.51 on Thursday – but not before China sent a shot cross Janet Yellen’s head by devaluing the renminbi.
Above all else, managing the edifice that is the US Treasury Bond market under conditions of large selling (China has dumped over a trillion in US Treasuries) becomes difficult when the currency those bonds are denominated in experiences “disorderly” and “too rapid” moves to the downside. Currency wars are sloppy – all the more so when technically insolvent governments and economies with vast over-capacities and malinvestments of differing varieties lock horns.
As this weekend approached, forex dollar longs decided to taken some chips off the table. But we’re going to see continued talk about the dollar continuing its upward trek. Count me skeptical. This FOMC stunt will fade, and that will probably be clear by as early as the end of next week.
Doc’s Silver Bullion Market Update:
The US Mint sold another million American Silver Eagles this week, bringing the monthly sales total to 3.03 million Silver Eagle coins.
Year to date, the Mint has sold an astonishing 21,942,500 Silver Eagles, on pace for an annual sales number north of 55 million coins!
While the Royal Canadian Mint does not release monthly sales figures for their gold and silver bullion coins, Silver Maple coins sales are undoubtedly on a record setting pace as well.
The RCM’s Predators Silver Cougar continues to push silver bullion demand, and the June 9th release of the Royal Canadian Mint’s new Superman S-Shield 1 oz Silver Bullion Coin (mintage of 1,000,000 like Wildlife, Birds of Prey, and Predators Series) is likely to trigger a frenzy of newbies buying silver as well.
With Silver Eagle and Maple coins for the most part readily available again, the Perth Mint’s 2016 Silver Kangaroo coin sales have slowed dramatically.
90% junk silver premiums, which often act as a leading indicator of the physical silver market, continue to soften, with SD Bullion now dropping premiums below Silver Eagles- the first time in nearly 5 years that 90% silver coins have been available at better premiums than Silver Eagles.
- Eric Sprott: Making Sense Of Precious Metals Volatility In Face Of FOMC Minutes And Jawboning
- The Gold Chart That Has Central Banks Extremely Worried – Steve St. Angelo (also includes link to Steve’s recent interview with Craig Hemke)
- A Crisis Unlike We Have Seen In Human History – John Rubino
- Peter Schiff On FOMC Minutes: Fed Cries Wolf, Traders Come Running
- US Media As Conduits Of Propaganda – Robert Parry
Thanks for checking out this week’s SD Weekly Metals & Markets – Eric Dubin