Man Oh Man, What A Night For A Fright!

Posted at 8:51 AM (CST) by & filed under General Editorial.

Great and Wonderful Monday Morning Folks,

       Gold is trading higher after the weekend, but not as high as the opening minutes, with the trade at $1,679.40, up $7 after reaching $1,704.30 (up $31.90) before all the calm was put into place, with the low at $1,658.00 right around the time of the London Open. Silver should be have had the police called out for the beating it’s taking right now, because a certain element can’t let it go, with the trade at $16.960, down 30.3 cents and after the first shot out of the gate put the price at $17.615 (+35.2 cents), with the starting London low at $16.570. The US Dollar, continues to collapse with the trade at 95.145, down another 78.9 points, yet it too has recovered from the fear, with all this “calm” being added after the trade dipped down to 94.665 with the Sunday night starting point at 95.780, Man oh Man What a Night For a Fright! Of course, all this happened already, before 5 am pst, the Comex open, the London close, and after the S&P500 went “Lock Limit Down”, Crude Oil traded $10 lower, and after the spot month in the 30 Year Treasury went 13 full basis points higher! Something I’ve never seen before in over 25 years!

      The Emerging Markets Currency Watch is showing the Calming Algo Machine is still working and in control. In Venezuela, Gold is under attack, as expected after last week’s IMF warning, with the price at 16,773.01 Bolivar, a lose of 77.90 with Silver at 169.388 showing a gut punch loss of 7.894 Bolivar over the weekend. The Argentine Peso is gaining value and pushing Gold lower with the trade at 104,842.09 showing a weekend loss of 305.27 A-Pesos with Silver losing 28.31 Peso’s with the super sale price of 1,058.94. Over in Turkey, the Lira has Gold beaten down to 10,272.30 showing a loss of 24.43 T-Lira with Silver losing 2.795 T-Lira’s with the price at 103.740.

      March Silver’s Delivery Demands shows a count of 749 contracts up on the board, proving a drop of 21 fully paid for 5,000 ounce obligations waiting for receipts and with a trading range between $17.435 and $16.570 with the last buy/sell at $16.960, showing us how those, that have the metals to sell, would rather sell at the lower prices than what used to be called normal, selling at the higher prices. Silver’s Overall Open Interest shows a small decline in count, since Friday mornings write up, with the total now at 196,042 Overnighters, proving a loss of 1,362 short contracts as of right now, with the idea that tomorrow morning, the shorts will have proven it piled on more than can be seen now. This activity can’t last much longer as our Resolute Buyers are soaking up their sells.

      March Gold’s Delivery Demands now shows a count of 97 fully paid for contracts waiting for receipts and with a Bigger Volume of 118 already posted up on the board with a trading range between $1,701.60 and $1,657.70 with the last buy/sell price at $1,675.30 proving the same point that the holders would rather lose value before they liquidated than sell at the higher price, this is done even after the fear trade was put into place, around the world. Gold’s Overall Open Interest proves the shorts are getting out while they can and during their manipulations with the count now at 668,692 Overnighters, proving a strong reduction of 21,318 Obligations during Friday’s trades. We expect the shorts to have piled on their game one more time as they attempt to tell everyone they remain calm even though we have a lock limit down in the Stock Market. You see, these Algos are not afraid of the Coronavirus, they fear being unplugged.

      “Lock Limit” is a term we use in the Commodity Sector. Reaching a “limit” is one thing which means a single trading month’s transaction reached the maximum move allowed, but is still trading. A “Lock Limit” is when the 3 first (front) months of the same Commodity hits the limit at the same time, then all trading stops. The S&P and the Dow Jones have “Lock Limited Down” in the overnight, meaning no more trades until later today. This is a “very scary moment” for anyone who is long a contract in either market because there are no buyers for their sell orders. “Lock Limit Down” is the exact opposite of what we expect in precious metals when they finally go exponential, when it is declared a “Lock Limit Up” or a “Time Out” since the rules were changed over a decade ago and for no reason.

      A quick lesson here is in the Commodities Sector’s Options Board. When a market goes lock limit, many are stuck in place, some winning and other losing equally, that’s when we look into the options to see how much more the markets might have traded “if” there was no limit move. The March S&P closed Friday at 2964.00 and is now at 2819.00 down 145 points. The March S&P 2970 “Put” closed on Friday at 96.25 with the last trade/post in the early morning at 170. The Option was “just in the money” at the Friday close and is now 170 points higher in value yet the market this derivative is made from is down 145 telling us another 25 points would have kept this market from locking limit.

China again, has cancelled most of their flights to Beijing, Shanghai, and Hangzhou, drawing public speculation that the changes were precautions “related to the novel coronavirus outbreak…. According to flight-tracking websites, almost all flights from Shenzhen and Guangzhou to Beijing, Shanghai and Hangzhou were cancelled after 5:15 p.m. local time on March 5. Some of the flights to Tianjin, Nanjing, Shenyang, and other top Chinese cities were cancelled as well. On March 6, flights resumed but were delayed.…with all passenger trains departing from Hangzhou, Shanghai, Beijing, Chongqing city, Chengdu in Sichuan province, Zhongshan in Guangdong province, and many other major Chinese cities also stopped operations on March 6.”

      Hopefully you are prepared for a staycation, while the world sorts out the lies from the truths in all media and governments, as we observe the rising global death tolls. Keeping Calm is a must, it allows those that can a chance to make decision’s not based in fear while those that do panic, prove why it’s safer to Keep Calm. Have a smile on your face and a kind thought in your heart, no matter what, and as always …

Stay Strong!

Jeremiah Johnson

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