The Golden Slipper
G'day. Can this weekend come fast enough? Not for me. I still can't work out where the week went but I'm certainly looking forward to shutting the mind down for a few days and having a good old play with Lisa and the kids. Although, truth be known, I don't mind missing a night's sleep when silver bolts out of the gates like it did last night. It's a freaky old rollercoaster playing this metal, and it just goes to show how dangerous being short this market can and will continue to be. If you're long, you can lose $6.95 per ounce, but if you're short, you've gotta buy, at ANY price. I can't wait until some serious longs demand physical delivery. That will be spectacular and make yesterday look like a Sunday afternoon barbeque. Just my take on the game at present.
Gold did very little, disappointingly IMO, considering the rather disturbing news regarding Iran and North Korea. The $420-22 level will provide some stiff resistance following its solid support a week or two back. Any further increase in "nuclear" tensions will be helpful to the bullish cause but awful for any societal cause. India is a happy importer and I have seen much anecdotal evidence of very strong demand across all of Asia. Reuters reported a delay in delivery for gold bars in India. Hmmm. I'm heading back down to my "coin man" on Monday morning to have a chat, and my local "bar dealer" (not bar-man), tells me gold is flying out of her place at high premiums. The Aussie dollar gold price is VERY attractive as is the Euro and a few others, IMO.
I note that one bank, who I'll not name, but who should know better than to guess, said "gold and silver tracked the Euro bounce". Fair crack of the whip. What freaking market were they watching? Sure gold only grabbed a percent or so but silver went nuts, up over 5% and traded here at above $7 today. Short sellers are so nervous and I think they are playing with fire. I dunno if they have put this little spot fire out yet, but if it takes hold there could be all sorts of mess ahead. Time will tell. I suspect we pull back to 6.80ish as the panic subsides and the lucky few who rode the wave, pocket some wedge. That $6.50 level has shown a heap of ticker the last few months and looks like it may be a "new line in the sand". I suspect we will struggle getting through $7.02 initially and should then be targeting around the 7.22 area, again.
At least we broke away from "Groundhog Day" in the metals, although we could easily relapse. Did anyone find that lazy Billion for me to borrow for a few years to take delivery of every ounce in Comex and control most of the world's above ground stocks? I told you I'd pay it back in U.S. Dollars. What? That's fair isn't it? The lease rate for 3 year silver is pretty steep, all of a percent or two. Maybe someone did have it stashed in their back pocket and didn't hand it over and are trying it for themselves. If so, they're going about it all wrong. Chasing it is not the way to go with silver, if you are trying to get a big position set. Soak up the inevitable periods of weakness, don't chase the strength or fan the flames of a short covering panic. Like I said earlier this week, silver is misunderstood, underappreciated, underanalyzed and way undervalued. Just my opinion and it's been very wrong before.
The Amex Gold Bugs Index (HUI) had as nice a day as it has had bad, of recent times. It's back above 200 and my white backside is staying out of sight for the time being. Best performers were the worst hit in recent times. Durbans (DROOY), Coeur (CDE) and Golden Star(GSS) were the major winners on the day. Fair enough too as they are among the most leveraged to the gold and silver price. The rand has helped out Durbies but what's the deal on GSS? A sentiment change maybe, or a few short sellers bailing out? I dunno but volume wasn't very noteworthy. I note Hecla (HL) has also bounced some 12% from its Wednesday low, but it didn't matter what you owned yesterday, except Goldcorp (GG). Whatever. HUI has to bust 220 before I get too excited but that will be another 10% higher, which should put a bit of lead in a few pencils around town.
I don't and won't talk about smaller cap miners, sorry. That's another game entirely.
Today is Friday. Some nasty things have occurred on Fridays previously, after London closes, when there is no physical market to keep the paper players in check. Just a heads up.
I'm having a tough time putting all this together at present. The kids are just asleep after having had a great evening up at the local park at the North Sydney noodle market. A little community get together every second Friday that has little stalls of great food and drinks (and desserts) and some good live entertainment. The band was doing great covers of Creedence and Elvis and all that, and the kids (and the "oldies") had a little bop around. All up a great time for all. Then the TV was on in the other room and it was DeNiro in Meet the Parents. What a Fokker of a movie. Just hearing different lines had me peeing my pants. I'm looking forward to the sequel which should be released down here in about 2017. Lisa just knocked together a pizza that has made it impossible to concentrate on anything. All the good stuff like pepperoni, cabanossi, peppers, onion, mushies and some special stuff I don't recognize. It rocks!
The big horse races are on again down here. We have two big carnivals each year.. spring and autumn. Autumn is bigger and more prestigious, IMO, with the Golden Slipper - the world's richest 2 year old race, the Australian Derby, The Doncaster, The BMW and the Arrowfield Stakes amongst many more super races.
I still haven't sold my mare, ouch, and her ¾ sister races in a half-million buck Grade 1 race in Melbourne tomorrow. There are 15 horses in the race and between them have won over $25 million in prizemoney and 18 Grade 1 races. It's too short a distance for her but a good showing will get the interest up. Her big go will be in about 5 weeks from now and about 1000 yards further than tomorrow's race. The BMW is hers, I reckon! Giddy-up little Vouvray!
Have a fun Friday and enjoy the weekend. I will.
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