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Wednesday, February 20, 2013

Panic Selling In Precious Metals - Just Ask The Margin Clerks

The more insulting the hate email becomes, the closer we are to an absolute low in this manufactured gold reaction. It is really foul today - Jim Sinclair.

What is certain to be come the powerful and indiscreet operation against gold continues without remorse. Today's panic selling which should push gold's WA TA below 6%, a reading lower than 8% - the lowest low generated at the height of the 2008 financial panic, illustrates the power of margin clerks.

An headline crossed my trading desk this morning - watch for signs of hedge fund dumping gold; be certain  that this story wasn't written by a margin clerk.  They've seen signs of panic dump since 2/6 when gold's WA TA fell below 20%.  This selling, like a runaway train, only ends when the track runs out (usually an unfinished bridge in the movies) or the engine deprived of fuel stops. I anticipate the latter as the precious metals diffusion indices surge above 60% in the coming weeks.

Chart:  London PM Fixed Gold and GLD (ETF) Total Assets WA Stochastic Exponential Moving Average (13DEMA)


My Dear Friends,

1. The more insulting the hate email becomes, the closer we are to an absolute low in this manufactured gold reaction. It is really foul today.

2. The nerve that I touched yesterday when I questioned the FDIC viability and aggregate insurance tells me that there is huge population of readers taking comfort in the absolute belief that the FDIC really will return your US dollar deposits should we have a systemic crisis. It will not because it cannot. It does not have the assets to meet even a small portion of all its implied guarantees. The size of the implied guarantee when you consider brokers as banks is enormous. It is an outrageous concept that you silly people take faith in. All your yelling and screaming letters go directly into the spam file. The best one is the jerk that ordered me to repent.

3. Gold will trade at $3500 and above. You bears that bang on me in an organized way on every reaction since $248 are once again wasting your time. Your emails do nothing but encourage me that I am absolutely correct.

4. Sending me the tomes of the Trojan Horse gold writer’s bearish gold claims and expecting me to answer you is another waste of your time. My answer is they are wrong, but if you believe them do whatever you please.

Sincerely, Jim

Source: more


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