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We remain precipitously oversold, but there seems to be no catalyst to snap the PM’s out of their torpor. What’s more, the dollar seems to be trying to find a bottom here as well.

Either that, or it’s just screwing with me.

Whatever, the case, we should be moving down into our 25%-40% core positions while hording our cash covetously for the inevitable return to glory. There may be a commodity wide move coming here if the dollar is truly done, so you may want to look at hedging with some puts or short commodity ETF’s. I have not done so yet, but will be looking at that prospect tomorrow.

Hang in there, we’re not through with this bull yet.

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Nothing much moved today on the PM side as the market collectively held it’s breath waiting for The Bernank’s do-nothing address. That speech, in turn, resulted in a massive shrug of the shoulders after market close today.

There’s some chop back and forth and further attempts upon my person in the form of certain “Chicken-playing” PM stocks (ahem, AAU and EXK, damn you!). These stocks attempt to force me off the road by driving straight at me at 110 mph, whilst drunk on Old Crowe whiskey.

I will not be moved by such crude tactics, and I continue to beleive there will be a bounce in the metal sectors collectively. Action in the minor metals like palladium and platinum are betraying this new direction, and even copper is showing stubborn signs of staying about $4.00.

In the meantime, dollar strength is seemingly being abetted by a weak Ozzie Dollah and Canuckistanian Looney. That too simply cannot be the basis for a dollar rip, so sorry. Not for the long term at least.

So just check yesterday’s chart for tomorrow’s action, as nothing looks very different. On another note, you may want to inspect the FAS-mobile tomorrow as well, as it looks like banks may be ready to roll once again.

Best to you all.
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We are either going to bounce hard here, or we are going to be cast into a pit of molten lava, where blood and bone will be cooked to a fine carbon gristle with extra smoke.

And I’m talking about both the SPY and the PM’s here. Both experienced a Bollinger Band crash (violation of the lower Bollinger) and both should rebound here in the next week, at least to the midpoint. In the case of the Gold Bugs Index ($HUI) that probably means the 200-day EMA.

Here’s the $HUI weekly, which clearly illustrates the return to the October breakout. We break here, and we’ll be headed for that long term support line down in the 500 area first:

Now the daily, with the Bollinger Band illustrations:

Does that look like it’s done to you? Me neither, which tells me if we do get a bounce it’ll likely be later morning tomorrow.

Whatever the case, I believe that unless I see evidence of us getting back over that 200-day EMA (above), I will be bringing my core all the way down to 25%, which will be my bull market low point. You should already be at 50%, give or take, in your PM concentrations. This is simply the next step down in raising cash for the coming wave forward.

I don’t know what it means for the SPY, but I don’t expect there’s much left in that rope either, if the dollar continues to strengthen and the financials and commodities continue to get clipped.

On the brighter side, however, I will note that while things look bleak, copper prices have held up well. Our own miners were hurt by today’s rumor of a Marxist nationalization effort in Peru. Such rumors give me good reason to keep my mining holdings in NAFTA countries alone. We are not being paid to take nation-risk here people. Look to Canada, Nevada and Mexico for your long term core holdings.

Last, I say look to sentiment. The last time Fly and I were this conditionally apocaplyptic, the market took off in a blaze of glory. Hell, even Gary Savage is hiding in Switzerland right now. Be strong for me, my friends.

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You know in this job, its hard not to become incredibly cynical and even (dare I say it?) “conspiracy minded.”  But when you see some of the actions of the people in power, both at the political and financial levers (Congress/POTUS and the Fed, along with the NY Banking Axis), one wants to cry out in frustration.

It’s a helpless feeling, like being a powerful swimmer encumbered by a straight jacket. Let me tell you this straight — anyone in business, no matter their political distinction, can tell you what makes businesses work and what encumbers them.

What makes businesses work, what makes businesses hire is the ability to plan. It’s a simple as that. Successful people in business are both smart and economically (not necessarily politically) conservative. If they are given a set of parameters to work with, no matter how onerous — they will eventually figure out a way to make money around them.

It’s only when the parameters are largely unknown — thanks to a tidal wave of government interference like we’ve seen in succession with Obamacare and the Dodd-Frank “reforms” recently enacted– that business people are left without the ability to plan for the future, and are thus frozen. Stephen L. Carter wrote a great article about this in Bloomberg recently, you should read it.

So now we are reaping the result of a frozen private sector and a gradually starving public sector (there will be no new government jobs out of the states, either, now that Stimulus is done).  So what’s the answer from Ben & Co?

Destroy the Dollar, one more time. 

This is why I’m still in PM’s despite their hinky motions over the last couple of days.   Maybe we get a dollar bounce at the lows again, I don’t know.   But they are killing it today, and who can blame them? 

What choice have they, under current circumstances?

My best to you all — and please, don’t just give up… Get involved!  You may not like Paul Ryan’s “Path to Prosperity,” but dammit all, at least he’s offering solutions.   

C’mon intelligent people of the world,  we need to put our heads together now, our countr(ies) need us.

Best to you all.
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There’s malfeasance afoot, I think, and I urge you to take caution.

Gold just dropped precipitously — $25 since this morning– without the dollar turning much at all.   Yesterday afternoon, there was a similar sell down in the silver markets– flash mob style —  even as physical COMEX inventories are reported at five year lows as of late May. (Hat tip to Jesse’s Cafe Americain).

What this tells me is that there are some big players throwing large boulders out there in these markets, trying to scare some people out of positions for various reasons — both optical and monetary.  The Fed has a big incentive to knock down the POG and POS, both as a cat’s paw for their inflationary plans and as a warning to Congress to “raise that debt ceiling or else.”

Moreover, the current physical readings portend that myriad shorts in silver especially could be in deep trouble despite the five-time increase in margin requirement by the COMEX last month.  That means small players could get stomped on in this elephant dance, and I am recommending everyone get to at least 50% cash here.  

If we are really stepping into a D-wave event, this will get us started on getting all the way back to bare core positions (about 25-30%  is where I like to hang personally, but you all need to decide on your own risk levels).  If this is just a head fake, we may have some opportunities to pick off some slower moving miners at deeper discounts.

Be well and be careful.

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[youtube:http://www.youtube.com/watch?v=9ouKJgoaTCY 450 300] The Latest From Australia
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Do not miss even one second of it, mothaflickas.

I’ve sold off a little more silver and a tiny bit of gold today. Mostly in my disappointments… like AAU. No, don’t worry, I still have a tonne, even as my gut tells me that it’s time to pack my bags for the summer and move down the road to a small shack from which I can barter conch meat, small beer and crab legs for shiny bits of tinsel I’ve stolen from the gulls.

That’s right, I’ve become an itinerant beach comber and summer lacrosse Dad, rather than a procurer of fine equities for you and yours. Oh, I’ll come up with a couple of dolorous pronouncements here and there, for sure. If I can get this thing to post without ghosts.

This week I will be accumulating cash. That’s what my gut is telling me to do, although gosh knows, betting against my gut has won me much lucre in the past as well. I just don’t like this dollar action, however. I was hoping for a downswoop and all I’m getting is a sag, and gold seems to be becoming sympathetic.

I don’t like that. Not one bit. So for now I’m going to give some up to the stop sign sun, and await better squid-shark oceans.

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