"When misguided public opinion honors what is despicable and despises what is honorable, punishes virtue and rewards vice, encourages what is harmful and discourages what is useful, applauds falsehood and smothers truth under indifference or insult, a nation turns its back on progress and can be restored only by the terrible lessons of catastrophe." … Frederic Bastiat

Evil talks about tolerance only when it’s weak. When it gains the upper hand, its vanity always requires the destruction of the good and the innocent, because the example of good and innocent lives is an ongoing witness against it. So it always has been. So it always will be. And America has no special immunity to becoming an enemy of its own founding beliefs about human freedom, human dignity, the limited power of the state, and the sovereignty of God. – Archbishop Chaput

Trader Dan's free work will soon be available at www.traderdan.biz

Thursday, February 16, 2012

S&P 500 once again bumping up against 1350

The 1350 level in the S&P 500 is becoming a rather significant resistance level on the technical price chart as the market has rallied to this point several times over the last two weeks and stalled out. Bulls are counting on further liquidity blasts from the Central Banks to provide them with enough ammunition to dislodge the selling originating at this zone.

I find it rather odd to see how the broader market is apparently ignoring the surge in gasoline prices as if soaring energy costs are not going to have the least impact on consumer spending  in terms of disposable income or transporation costs across the entire economy.

Central Banks are attempting to ward off deflationary pressures from issues arising from massive amounts of debt in the system so what we have here is a battle between the forces of liquidity and those of debt. From what I can see of the price chart, the liquidity forces are apparently able to trump everything. It also goes to show you how utterly disconnected the stock market is from the reality of most citizens.

This rally in the equities is what is pulling silver and gold off of their lows in today's session. It is also pulling copper off its worst levels as well. If the Fed wants inflation, they are going to get it. A strong upside performance in the S&P will guarantee that the metals all begin moving higher, whether or not any fundamentals justify the move or not as hedge funds will bid up everything tangible and send those prices soaring.

The  Fed had better be careful however that their gambit does not allow the long bond to drop below the bottom of its nearly 4 month old trading range. That would be a No-No for Uncle Sam for if long term borrowing costs were to begin rising, the cost of servicing this idiotic mountain of debt that has been heaped upon our nation will becoming unbearable. No doubt orders will go out to Goldman and Morgan to buy bonds if it looks like the bond technical price chart might be breaking down.


  1. The cartel must have had insider information that they were going to push the DXY lower to try and goose the markets (after all - it's the same crowd controlling both). The raid activity has been downright obnoxious, pushing silver lower 40 cents on a dovish fed meeting minutes, doing a 60 cent raid this morning on bullish economic news? WTF? So much for the worthless CFTC. This week's COT should show they stepped on the gas on the shorts.

    But as they continue to go further in on the short side, the inevitable retrenching to higher ground must take place, and the likelihood continues to grow that more and more specs are joining the party as the equity rally takes a pause. Once the longs know they got the shorts by the balls, we could see a nice volatily move higher. Greece deal possibly Monday. They could push the EUR/USD up to 1.33, and you could very easily see the cartel retrench to 1760/34, and that may not hold either.

  2. All Bond Markets, currencies, vs. Media, big Gov, and Big Banks vs. US Citizens. Truly unprecedented times. It is amazing to watch. Throw in middle east unrest, European unrest, middle class americans being thrown to the wolves, older Americans being fried, and you get the biggest, most unbelievable fight in history slowly unfolding.....until...Bango, jango. Dan, you are a Patriot, no matter what Mr. Mini T says about you. Thank you. Risk/Return at its Peak slowly, slowly creeping towards your triangle. No way to determine who they beat down next. I really wish Mr. Freeh made a proper decision, but his affiliations do not look good, nor do his interviews. I mean really Mr. Freeh, proper government rules???? Mr. Bernanke, your father who worked so diligently to put you through school with his business, are you so arrogantly intelligent? I am amazed at the American ignorance, but I guess, the MSM is controlling all of them. Hard at work, just trying to survive. Pitiful.....We certainly live in INTERESTING TIMES, don't we Danno. I live with real Americans all day everyday, and I have for the last 4 years, it is not their fault. The blame falls on our leaders (term lightly used for people like Dimon, Blanfein, Immelt, Corsine, Soros, and many others.)

  3. I used to lend to many small business' in the US; I have a ton of experience, knowledge, and they are hurting. All of them. What surprises me is this...after the failure of Solyndra, why are we not auditing the entire portfolio of the FFB (Federal Financing Bank) controlled by Mr. Timothy tax turbo Geitner? Why? I mean, in for profit banks...although they are far and few between nowadays...their are rules. Charge off after 90 days..period. Non Performing loans are audited, whole portfolios are audited. No mention of this anywhere. I would say that the whole portfolios need audited. I guess it is like Ron Paul demanding auditing the FED. They need to pump worthless money down into a rathole. They need the American people to remain confident in the worthless decsions of fools like Mr. Timothy Geithner, who himself, cheated the Tax system. Kind of like Ms. Pelosi, who earns millions on insider trading. It is Pathetic, and everyone wonders why volume is disappearing. It is distrust in the Government. I distrust them all. Mr. Freeh, stand up, be counted, do not hide. Let us see what you are all about. We have seen what our DOJ is all about? He is a worthless POS. He is corrupt, he is an arrogant and whole hearted fool. Mr. Freeh everyone is watching. I guess we see soon? Or, is your company awaiting payoff behind closed doors? In my opinion, you are getting alot of money to shut up and let the JPM's of the world steal money. You are complicit, and this is the point Anne Barnhardt makes very clear. You are a filthy POS, and Americans are sick of it. We will all take every penny out of this corrput system, we will buy precious metals and watch you fools cheat yourselves until the whole thing blows up. Good luck. Dan, sorry, but I have to vent.

    1. I posted a comment last night but somehow it has disappeared.

      White Wolf...

      This is your second wild rant posted on Dan's very informative and LOGICAL blog.

      You sound completely out-of-control emotional.

      Sure, we all have a reaction to what is going on in this world. But you are over the top.

      Before you hurt yourself or someone else, you should seriously consider consulting a therapist to help resolve your anger.

      Ranting here on Dan's blog adds NO VALUE at all and, as Dan indicated on your previous rant, you need to consider that your comments on the internet 'may' be being monitored by persons who may consider you 'a problem' to the current power structure.

      Regardless of your so-called 'understanding' of world and financial conditions, you need to get a grip on your emotions, calm down, and learn how to deal with circumstances rather than banging your head against the 'wall' of the power structure in this world which, in the end, will only knock you out and accomplish nothing positive.

    2. Rather very informative Gold Trader. I like your "Freudian Approach". I like Anne Barnhardts post much better. It shows what America is turning into. My neighbors were robbed in broad daylight. It WAS a nice community on the Chesapeake Bay. I have her cell number and a policeman down the street says there were 4 robberies last week in a community that has been very quiet for 15 years. It is not at rant rather FACTUAL. Perceptions are personal, no question, however, in my opinion, Glen Beck has hit it right on the head. Napolitano's firing is confirming the inevitable battle. I have no doubt the real struggle has begun. Your post confirms it. Monitoring....???
      That I am sure is happening, but the "Freedom of Speech" is surely protected for now. I do thank Dan for his insight. The only people I will hurt are those that attempt to hurt me. I am stable, working, and no longer a banker. What are you?

  4. This comment has been removed by the author.

  5. Pretty hilarious too...WTI tonite..$104..wow...bought in at $92.. Good ole gov cant control a Middle East ready to explode. I guess just a ....Spring right????
    Hilarious...love it.. cashing out as soon as it starts to be contolled by the BOTS

  6. Dan, I thank you for all of your information. It is coming not question. Mr. Sinclair is correct. These bullion bankers are arrrogant, and people of faith are their prey. I am saddened. It is not what the world should be right. Jesus, help us. I love people and will help all the neighbors I know. I have a strong back, a wood stove, a pretty good sense of idiots, and am grateful for my life. I sold my Cadillac XL, my Donzi, and need to sell my time share for Raintree? Anyone interested, it is as cheap as it needs to be. Citi is the financier. If I have to, it certainy can be given back to them. Not sure of its value. There are some beautiful hotels in Wyoming for all you Liberals out there. I mean guns, mountains, and nice hard living.
    Anyone,,,gold trader...want to work hard for a life? Did not think so...

  7. A great link for the MSM Gold Trader. My opinion is not my opinion. It is quite a few individuals opinions. War in the Middle East. Huge deficit spending, heavy handed taxes. David Stockman? I think he has value don't you? Unemployment is not a joke, I was unemployed for a period of time. I now work for friends and friends of friends. Have had three jobs out of Banking and all are supportive of small entrepreneurial business. Big Gov is a joke. Bernanke is now feeding big gov. He should be ashamed. I really hope they all pay attention to this guy. He is non partisan.
    My view of the world...???? I think alot of people are starting to finally understand. At least alot I run into will listen.

  8. Dear Trader Dan,
    I am interested in your opinion on the DXY and different gold charts.
    When you take a train sitting in the station, sometimes you look out the window and you see movement relative to the train on the next set of tracks. Then a brief mental gymnastic question goes trough your mind - am I going forward relative to this train - or is it going backwards relative to me?
    Someone said to me Sunday - a non gold investor - that gold is quite expensive. That's quite true on a historical viewpoint. I then pointed out the slow slide in purchasing power of Western currencies is masking the fact that gold is preserving purchasing power relative to these currencies.
    When I look at a two year chart of DXY - it just jumps off of the page that something happened in September of 2011. Something that has made the US dollar attractive as a "store of value". Now considering a six month period for DXY, I get the feeling that it would not take a very big move to knock DXY off of its pedestal. I then think about how gold keeps bumping against 1750US without a breakout, and similarly gold verses other currencies. We traded above 42270 euros/kilo and basically we are still at these prices.
    So which train is moving, and in which direction?
    This is not an answer to my question, but a market fact: In the beginning of September the Swiss Central Bank could not let its currency go down any more versus the euro. It had briefly touched parity with the euro and was beginning to affect its economy. They established a "peg" of sorts with the euro. This took away a currency "to flee to" and in my opinion has increased the attractiveness FOR A TIME of the American dollar.
    So place your bets, which chart breaks out: gold up and verses which currency, or does DXY break down (pushing gold above 1750US)?

  9. And while you're at it, Trader Dan, why not post a one year chart of gold/US pointing out the date of the Swiss National Bank decision. I believe it was September 6th 2011.
    Now why would gold go down on such news?

  10. It is my belief that the cohesion between govt and big bullion banks now is the primary reason you see liquidity rising and bullion and gold stocks remaining trapped. That is the new answer. Just have JPM and Mr. Diamon have a few drinks with the G man and you have your answer. Sell, sell, hurt those "speculators". Strictly an opinion. Rigged markets now. Steal the wealth of all savers, steal the wealth of those trying to save with gold, silver and mining stocks. Knock em down Jamie, Carol. In the immortal words of Mel Brooks in the movie "Blazing Saddles" We have to keep our phoney baloney jobs. Just an opinion mind you. I went to oil and have seen a nice ride. Gold's ride is not over, as long as the banks get their money for nothing and Bullion Banks get their Chicks for free, it is going to be a fight. Eventually they lose. The East continues to accumulate, diversify out of dollars and into hard production assest. Their people save all the while the CME is losing volume. When the gig is up, most of the power and bullion bankers fire up their jets and jettison off into the sunset. Then and only then will it ride like a rocket. Until then I believe Oil is the Beatles ticket..She's got a ticket to ride...


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