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andreagillmer · 7 years ago

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Volatility Breeds Contempt

Source: Michael Ballanger for Streetwise Reports 10/14/2018

Precious metals expert Michael Ballanger discusses the stock market volatility of the last week and what it may mean for precious metals.

When asked about the dominant theme for the markets last January, I said that the one thing I looked forward to was a return of “VOLATILITY” as the Federal Reserve Board moved to “normalize” the interest rate structure, now commonly referred to as quantitative tightening. What has actually transpired since then was a brief volatility spike in February during which the UVXY tripled in ten days but other than that, markets screamed higher, hitting new high after new high with annoying complacency and irritating certainty while “VOL” collapsed.

Despite the U.S.-China trade friction, rising yields, weak overseas markets and increasing geopolitical tensions, the NASDAQ has been on fire while Canadian weed deals have dominated water cooler conversations for most of 2018. Volatility has been largely absent until last week, when it snuck into the upstairs bedroom under cloak of darkness and removed all cash and jewelry from the room. The S&P 500 (after Thursday’s close) had given back 7.2% from its 2,940 peak seen in September when every anchor or commentator in the financial media was breathless with glee. S&P began the Friday session up a mere 2.05% YTD, which is still positive for the year, and remains superbly superior to gold’s 6.24% decline since 2018 arrived.

In February and in May, gold and stocks were neck and neck but once the Donald decided to ratchet up the trade war, interventions became epidemic and the S&P quickly took off with gold doing the reverse. The gold gurus point to the “China Peg” as the bogeyman in the precious metals bedroom but the reality is that the algobots picked up the correlation and as they did with the gold-yen and the gold-euro pairs in earlier times, they tend to stay with the correlation “that is working” for longer than you can say “rational.” I will refrain from debating whether it is a Chinese “policy” peg or an “algo-gone-anal” peg but the reality is that IF the West wants the Chinese currency UP versus the U.S. dollar, all it needs to do is move gold to $2,000 per ounce and the currency issues will be summarily corrected. (As will my net worth issues as well.)

Thursday’s $34 move in gold was a reaction of classic proportions to stock market routs occurring around the world with alarming frequency but what was bothersome was that silver failed to catch the slightest of bids closing up a tad despite the impressive move in gold. As you all know by now, precious metals advances that have “teeth” include silver outperforming gold and the miners outperforming the metals so Thursday’s action was incomplete in firing up the adrenalin. I tweeted out my intention to add to my holdings on Friday in selected junior explorcos as well as buying the GLD Dec $115 calls for under $3.00. I wanted to see the silver market outperform the gold market Friday (which it did) AND I needed my trusty canine Fido to come out from under the tool shed (which he did) in order for my bravery level to allow me to pull the trigger on these positions.

Back on August 27, I published my letter under the title of “Back up the truck…” in response to the terrific technical action of gold as it was coming off the $1,167 lows since from August 16 with a proviso that I needed the market to remain above the $1,200 level for more than a millisecond in order for me to go “ALL-IN.” For the next five weeks, gold meandered over and under $1,200 a dozen times with the lows being in the mid-$1,180s while the omnipotent COT Report (tongue firmly planted “in cheek”) failed to ignite anything more than a yawn despite the more-than-often-right Commercials actually long gold for the second time in 20 years and amazingly long silver for the first time ever.

Coupled with record shorts held by Large Speculators in both gold and silver, the potential for a short squeeze was high and rising then and even higher and rising now. However, I still need to see the dips be bought and the rallies left alone in order to convince myself that this is finally the point where money flows back into the U.S.-dollar denominated price of gold, which in turn will send the stock jockeys piling into the Junior and Senior Miner ETFs as well as the little explorcos. I believe this is an ongoing process that will accelerate as returns in the NASDAQ fade and money moves in search of alternative returns as happened in 2002 and late 2015. In Canada, as soon as the weed deals get crushed, money will also gravitate back to mining so the right course of action is to accumulate physical gold and silver in advance of this “Great Rotation” out of paper assets and into hard assets.

This past week’s highlight was Thursday’s big rally in gold but as of Tuesday, the bullion banks had accumulated the largest long position in gold futures since the CME began reporting the COT numbers. Up until this week, COT structure extremes had gone largely unnoticed as the algobots continued to press their short bets while the Commercials were tickled pink to accommodate. Thursday’s action was terrific in that I got a chance to witness what happens when a large amount of emotion spills over into the relatively miniscule precious metals markets and catches the ‘bots on the wrong side. Being devoid of emotion, the ‘bots simply follow the signals and if it is time to cover shorts or initiate new longs, they do it “at market” and will keep at it until either the software commands it or the price managers pull the plug.

To have a $6 pullback after that massive move on Thursday was a large “NOTHING” but next week I will need to see (and EXPECT to see) a follow-through surge with silver coming out of the starting blocks on fire. I cannot stress enough the significance of this COT report; it is historic. The net long position of the always-short Commercials is 42,617 contracts and that compares with the December 2015 bottom at $1,045 when they came in at a wildly bullish net short of “only” 2,911 contracts. What followed was a truly massive rally in bullion (37%) and a 280% advance in the HUI. We are coming off an August/2018 low that is $122 above the December/2015 low with the HUI 54 points above the January 2016 capitulation low of 99.17.

With sentiment so drastically negative, the potential exists for a multi-quarter advance that can resemble that spectacular eight-month rally in 2016 but if you want to know the truth, I say it will be more akin to 2002, where those positioned in silver at $10 even after it was up 300% saw another 500% advance by 2011. As for the outlook for the miners, Goldcorp was a $4 stock in 2002; it peaked at over $45 in September 2011. Think about it.

If we get a move north of the 100-dma at $1,240 next week, the stage will be thoroughly set for an advance to 200-dma at $1,295 where it will need to spend a great deal of time consolidating as the magic $1,300 was a major area of support in May until it got crushed on June 21. For now, I am confident that the mid-August lows are your stop-loss floor and the assault on $1,400 is now officially underway. I backed up the proverbial truck and filled up the bed back in August-September but with the weekly chart looking so positive, it is finally time to find something with a tad more cargo space and just to give you an idea of how bullish I am for Q4/2018 and beyond, the appropriate vehicle to be loaded this time is a large ocean liner or an oil supertanker.

One final note: You may have noticed a trace of exasperation in my writings of late and if indeed you did, you are distinctly on the money as there is no question that my affinity for gold hit a career low last month but it had nothing to do with gold or silver. It had to do with an almost perverse sense of regret in recommending and investing in Western Uranium. I have consistently made above-average returns in trading gold and silver since I entered the securities industry in 1978 but the recent arrival of the algos into the gold pits have taken away from me the ability to use gut feel or tape sense or pit instincts to make decisions and execute. I liked Western Uranium in 2016 after meeting the principal investors in the deal but the timing was wrong and I saw my $1.70/unit investment go into terminal crash-dive mode as uranium continued its death spiral to $18/lb. I assisted with the financing effort six weeks ago at $0.68 per unit (including a half-warrant at $1.15) and watched with amazement as investors decided out of nowhere that vanadium was undervalued and then followed it up with a similar revelation for uranium.

Call it morbid curiosity or outright cynicism but I have become so engrained with the dismal action in gold and silver and the miners that to see WUC scream out of the gate and quintuple eight weeks after the placement closed put me squarely into a state of disbelief. Since the financial crisis of 2008, we have watched no fewer than twenty-five events that should have taken gold through $2,000 per ounce but constant interventions and manipulations continually to plagued precious metals price performance in truly maddening fashion. As gold investors, when was the last time that we had a gold stock go from $0.68 to $3.32 in two months on a valuation reset? Therein lies the root of my angst. After all I have tried to convey over the years, when was the last time a gold (or silver)-related security actually became a brilliantly successful trade? A few have, but the majority are usually doomed to the mediocrity of shitty markets or shitty management, both of which I deem a most-convenient cop-out.

The frustration I feel lies in the truth that underlies the 2018 landscape; the elite class want the bankers, politicians and regulators to ignore 5,000 years of history. They would instead prefer to demand that their appointed central banker like Greenspan or Yellen or Powell simply follow the plan that was originated after the 1987 market crash and ensure that markets behave according to the carefully crafted script, which means gold and silver are the enemy, stocks are our saviors, and bonds don’t count. As stated earlier, the bullion banks that have been pointed to as the major culprits in the gold and silver rigging scheme are now heavily positioned for an up move and have been since August. The inevitability of the Commercials crushing the hedge funds is the reason I expect the miners to begin to perform like the uranium/vanadium stocks, where REAL supply and REAL demand ex-interventions create a free and natural upward hydraulic so absolutely critical to properly-functioning markets.

This coming week will tell us whether can welcome a new paradigm for the precious metals or whether we simply devolve back into the status quo. Stay tuned and cross your fingers.

It is time.

Originally trained during the inflationary 1970s, Michael Ballanger is a graduate of Saint Louis University where he earned a Bachelor of Science in finance and a Bachelor of Art in marketing before completing post-graduate work at the Wharton School of Finance. With more than 30 years of experience as a junior mining and exploration specialist, as well as a solid background in corporate finance, Ballanger’s adherence to the concept of “Hard Assets” allows him to focus the practice on selecting opportunities in the global resource sector with emphasis on the precious metals exploration and development sector. Ballanger takes great pleasure in visiting mineral properties around the globe in the never-ending hunt for early-stage opportunities.

Disclosure: 1) Michael J. Ballanger: I, or members of my immediate household or family, own shares of the following companies mentioned in this article: Western Uranium & Vanadium Corp. I personally am, or members of my immediate household or family are, paid by the following companies mentioned in this article: None. My company has a financial relationship with the following companies referred to in this article: Bonaventure Explorations Limited is owned by me and my wife and has earned consulting fees from Western Uranium & Vanadium in the past. I determined which companies would be included in this article based on my research and understanding of the sector. Additional disclosures are below. 2) The following companies mentioned in this article are billboard sponsors of Streetwise Reports: None. Click here for important disclosures about sponsor fees. As of the date of this article, an affiliate of Streetwise Reports has a consulting relationship with Western Uranium & Vanadium. Please click here for more information. The information provided above is for informational purposes only and is not a recommendation to buy or sell any security. 3) Statements and opinions expressed are the opinions of the author and not of Streetwise Reports or its officers. The author is wholly responsible for the validity of the statements. The author was not paid by Streetwise Reports for this article. Streetwise Reports was not paid by the author to publish or syndicate this article. Streetwise Reports requires contributing authors to disclose any shareholdings in, or economic relationships with, companies that they write about. Streetwise Reports relies upon the authors to accurately provide this information and Streetwise Reports has no means of verifying its accuracy. 4) This article does not constitute investment advice. Each reader is encouraged to consult with his or her individual financial professional and any action a reader takes as a result of information presented here is his or her own responsibility. By opening this page, each reader accepts and agrees to Streetwise Reports’ terms of use and full legal disclaimer. This article is not a solicitation for investment. Streetwise Reports does not render general or specific investment advice and the information on Streetwise Reports should not be considered a recommendation to buy or sell any security. Streetwise Reports does not endorse or recommend the business, products, services or securities of any company mentioned on Streetwise Reports. 5) From time to time, Streetwise Reports LLC and its directors, officers, employees or members of their families, as well as persons interviewed for articles and interviews on the site, may have a long or short position in securities mentioned. Directors, officers, employees or members of their immediate families are prohibited from making purchases and/or sales of those securities in the open market or otherwise from the time of the interview or the decision to write an article, until one week after the publication of the interview or article. As of the date of this article, officers and/or employees of Streetwise Reports LLC (including members of their household) own securities of Western Uranium & Vanadium Corp., a company mentioned in this article.

Charts courtesy of Michael Ballanger.

Michael Ballanger Disclaimer: This letter makes no guarantee or warranty on the accuracy or completeness of the data provided. Nothing contained herein is intended or shall be deemed to be investment advice, implied or otherwise. This letter represents my views and replicates trades that I am making but nothing more than that. Always consult your registered advisor to assist you with your investments. I accept no liability for any loss arising from the use of the data contained on this letter. Options and junior mining stocks contain a high level of risk that may result in the loss of part or all invested capital and therefore are suitable for experienced and professional investors and traders only. One should be familiar with the risks involved in junior mining and options trading and we recommend consulting a financial adviser if you feel you do not understand the risks involved.

( Companies Mentioned: WUC:CSE; WSTRF:OTCQX, )

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goldcoins0 · 7 years ago

Text

Volatility Breeds Contempt

Source: Michael Ballanger for Streetwise Reports 10/14/2018

Precious metals expert Michael Ballanger discusses the stock market volatility of the last week and what it may mean for precious metals.

When asked about the dominant theme for the markets last January, I said that the one thing I looked forward to was a return of "VOLATILITY" as the Federal Reserve Board moved to "normalize" the interest rate structure, now commonly referred to as quantitative tightening. What has actually transpired since then was a brief volatility spike in February during which the UVXY tripled in ten days but other than that, markets screamed higher, hitting new high after new high with annoying complacency and irritating certainty while "VOL" collapsed.

Despite the U.S.-China trade friction, rising yields, weak overseas markets and increasing geopolitical tensions, the NASDAQ has been on fire while Canadian weed deals have dominated water cooler conversations for most of 2018. Volatility has been largely absent until last week, when it snuck into the upstairs bedroom under cloak of darkness and removed all cash and jewelry from the room. The S&P 500 (after Thursday's close) had given back 7.2% from its 2,940 peak seen in September when every anchor or commentator in the financial media was breathless with glee. S&P began the Friday session up a mere 2.05% YTD, which is still positive for the year, and remains superbly superior to gold's 6.24% decline since 2018 arrived.

In February and in May, gold and stocks were neck and neck but once the Donald decided to ratchet up the trade war, interventions became epidemic and the S&P quickly took off with gold doing the reverse. The gold gurus point to the "China Peg" as the bogeyman in the precious metals bedroom but the reality is that the algobots picked up the correlation and as they did with the gold-yen and the gold-euro pairs in earlier times, they tend to stay with the correlation "that is working" for longer than you can say "rational." I will refrain from debating whether it is a Chinese "policy" peg or an "algo-gone-anal" peg but the reality is that IF the West wants the Chinese currency UP versus the U.S. dollar, all it needs to do is move gold to $2,000 per ounce and the currency issues will be summarily corrected. (As will my net worth issues as well.)

Thursday's $34 move in gold was a reaction of classic proportions to stock market routs occurring around the world with alarming frequency but what was bothersome was that silver failed to catch the slightest of bids closing up a tad despite the impressive move in gold. As you all know by now, precious metals advances that have "teeth" include silver outperforming gold and the miners outperforming the metals so Thursday's action was incomplete in firing up the adrenalin. I tweeted out my intention to add to my holdings on Friday in selected junior explorcos as well as buying the GLD Dec $115 calls for under $3.00. I wanted to see the silver market outperform the gold market Friday (which it did) AND I needed my trusty canine Fido to come out from under the tool shed (which he did) in order for my bravery level to allow me to pull the trigger on these positions.

Back on August 27, I published my letter under the title of "Back up the truck..." in response to the terrific technical action of gold as it was coming off the $1,167 lows since from August 16 with a proviso that I needed the market to remain above the $1,200 level for more than a millisecond in order for me to go "ALL-IN." For the next five weeks, gold meandered over and under $1,200 a dozen times with the lows being in the mid-$1,180s while the omnipotent COT Report (tongue firmly planted "in cheek") failed to ignite anything more than a yawn despite the more-than-often-right Commercials actually long gold for the second time in 20 years and amazingly long silver for the first time ever.

Coupled with record shorts held by Large Speculators in both gold and silver, the potential for a short squeeze was high and rising then and even higher and rising now. However, I still need to see the dips be bought and the rallies left alone in order to convince myself that this is finally the point where money flows back into the U.S.-dollar denominated price of gold, which in turn will send the stock jockeys piling into the Junior and Senior Miner ETFs as well as the little explorcos. I believe this is an ongoing process that will accelerate as returns in the NASDAQ fade and money moves in search of alternative returns as happened in 2002 and late 2015. In Canada, as soon as the weed deals get crushed, money will also gravitate back to mining so the right course of action is to accumulate physical gold and silver in advance of this "Great Rotation" out of paper assets and into hard assets.

This past week's highlight was Thursday's big rally in gold but as of Tuesday, the bullion banks had accumulated the largest long position in gold futures since the CME began reporting the COT numbers. Up until this week, COT structure extremes had gone largely unnoticed as the algobots continued to press their short bets while the Commercials were tickled pink to accommodate. Thursday's action was terrific in that I got a chance to witness what happens when a large amount of emotion spills over into the relatively miniscule precious metals markets and catches the 'bots on the wrong side. Being devoid of emotion, the 'bots simply follow the signals and if it is time to cover shorts or initiate new longs, they do it "at market" and will keep at it until either the software commands it or the price managers pull the plug.

To have a $6 pullback after that massive move on Thursday was a large "NOTHING" but next week I will need to see (and EXPECT to see) a follow-through surge with silver coming out of the starting blocks on fire. I cannot stress enough the significance of this COT report; it is historic. The net long position of the always-short Commercials is 42,617 contracts and that compares with the December 2015 bottom at $1,045 when they came in at a wildly bullish net short of "only" 2,911 contracts. What followed was a truly massive rally in bullion (37%) and a 280% advance in the HUI. We are coming off an August/2018 low that is $122 above the December/2015 low with the HUI 54 points above the January 2016 capitulation low of 99.17.

The frustration I feel lies in the truth that underlies the 2018 landscape; the elite class want the bankers, politicians and regulators to ignore 5,000 years of history. They would instead prefer to demand that their appointed central banker like Greenspan or Yellen or Powell simply follow the plan that was originated after the 1987 market crash and ensure that markets behave according to the carefully crafted script, which means gold and silver are the enemy, stocks are our saviors, and bonds don't count. As stated earlier, the bullion banks that have been pointed to as the major culprits in the gold and silver rigging scheme are now heavily positioned for an up move and have been since August. The inevitability of the Commercials crushing the hedge funds is the reason I expect the miners to begin to perform like the uranium/vanadium stocks, where REAL supply and REAL demand ex-interventions create a free and natural upward hydraulic so absolutely critical to properly-functioning markets.

This coming week will tell us whether can welcome a new paradigm for the precious metals or whether we simply devolve back into the status quo. Stay tuned and cross your fingers.

It is time.

Originally trained during the inflationary 1970s, Michael Ballanger is a graduate of Saint Louis University where he earned a Bachelor of Science in finance and a Bachelor of Art in marketing before completing post-graduate work at the Wharton School of Finance. With more than 30 years of experience as a junior mining and exploration specialist, as well as a solid background in corporate finance, Ballanger's adherence to the concept of "Hard Assets" allows him to focus the practice on selecting opportunities in the global resource sector with emphasis on the precious metals exploration and development sector. Ballanger takes great pleasure in visiting mineral properties around the globe in the never-ending hunt for early-stage opportunities.

Disclosure: 1) Michael J. Ballanger: I, or members of my immediate household or family, own shares of the following companies mentioned in this article: Western Uranium & Vanadium Corp. I personally am, or members of my immediate household or family are, paid by the following companies mentioned in this article: None. My company has a financial relationship with the following companies referred to in this article: Bonaventure Explorations Limited is owned by me and my wife and has earned consulting fees from Western Uranium & Vanadium in the past. I determined which companies would be included in this article based on my research and understanding of the sector. Additional disclosures are below. 2) The following companies mentioned in this article are billboard sponsors of Streetwise Reports: None. Click here for important disclosures about sponsor fees. As of the date of this article, an affiliate of Streetwise Reports has a consulting relationship with Western Uranium & Vanadium. Please click here for more information. The information provided above is for informational purposes only and is not a recommendation to buy or sell any security. 3) Statements and opinions expressed are the opinions of the author and not of Streetwise Reports or its officers. The author is wholly responsible for the validity of the statements. The author was not paid by Streetwise Reports for this article. Streetwise Reports was not paid by the author to publish or syndicate this article. Streetwise Reports requires contributing authors to disclose any shareholdings in, or economic relationships with, companies that they write about. Streetwise Reports relies upon the authors to accurately provide this information and Streetwise Reports has no means of verifying its accuracy. 4) This article does not constitute investment advice. Each reader is encouraged to consult with his or her individual financial professional and any action a reader takes as a result of information presented here is his or her own responsibility. By opening this page, each reader accepts and agrees to Streetwise Reports' terms of use and full legal disclaimer. This article is not a solicitation for investment. Streetwise Reports does not render general or specific investment advice and the information on Streetwise Reports should not be considered a recommendation to buy or sell any security. Streetwise Reports does not endorse or recommend the business, products, services or securities of any company mentioned on Streetwise Reports. 5) From time to time, Streetwise Reports LLC and its directors, officers, employees or members of their families, as well as persons interviewed for articles and interviews on the site, may have a long or short position in securities mentioned. Directors, officers, employees or members of their immediate families are prohibited from making purchases and/or sales of those securities in the open market or otherwise from the time of the interview or the decision to write an article, until one week after the publication of the interview or article. As of the date of this article, officers and/or employees of Streetwise Reports LLC (including members of their household) own securities of Western Uranium & Vanadium Corp., a company mentioned in this article.

Charts courtesy of Michael Ballanger.

( Companies Mentioned: WUC:CSE; WSTRF:OTCQX, )

from https://www.streetwisereports.com/article/2018/10/14/volatility-breeds-contempt.html

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purpleavenuecupcake · 6 years ago

Text

Eni annuncia la scoperta di Akoma nella licenza CTP-Blocco 4, nell’offshore del Ghana

Eni annuncia una scoperta a gas e condensati nella licenza CTP-Blocco 4, nell’offshore del Ghana. Il pozzo, perforato sul prospetto esplorativo Akoma, ha provato risorse tra i 550 e i 650 bcf di gas e 18-20 milioni di barili di condensato associato. La scoperta ha ulteriore potenziale per gas e olio che sarà oggetto di una campagna di perforazione dedicata. Il pozzo esplorativo Akoma – 1X si trova a circa 50 km dalla costa e 12 km a nord-ovest dall’hub di Sankofa, dove è posizionata la FPSO John Agyekum Kufuor. Il pozzo è stato perforato con la nave di perforazione Maersk Voyager in profondità di acqua di 350 metri e ha raggiunto una profondità complessiva di 3790 metri. Il pozzo ha incontrato una singola colonna mineralizzata a gas e condensato in un intervallo di arenarie cenomaniane con uno spessore di 20 m con buone proprietà petrofisiche. Akoma – 1X è il primo pozzo esplorativo perforato nella licenza CTP-Blocco 4 e rappresenta una scoperta di valore potenzialmente commerciale per la sua vicinanza alle infrastrutture produttive esistenti. La scoperta può infatti essere rapidamente indirizzata alla produzione attraverso un collegamento sottomarino alla vicina FPSO permettendone l’estensione della vita produttiva. La Joint Venture della licenza CTP-Blocco 4 è costituita da Eni Ghana (operatore, 42.469%), Vitol (33.975%), GNPC (10%), Woodfields (9,556%) e Explorco (4,00%). Il Ghana è uno dei paesi chiave nella strategia di crescita organica della Compagnia. Eni è presente nel paese dal 2009 e oggi ha una produzione operata di circa 60,000 barili di olio equivalente al giorno. Read the full article

#Akoma #eni #Ghana

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gasnewsnet-blog · 9 years ago

Text

Vitol: New licence awarded in Ghana

A consortium comprising GNPC, Explorco, Vitol, Eni and Woodfields, has been awarded a new exploration licence, Cape Three Points Block 4, located in the Tano Basin, offshore Ghana. GNPC, Vitol and Eni are already developing the Sankofa and Gye Nyame fields to provide gas for Ghana’s thermal power sector to 2036 and the new block lies near the existing Sankofa / Gye Nyame fields. The Cape Three…

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#Cape Three Points Block 4 #Eni #Explorco #Ghana #GNPC #offshore #Tano Basin #Vitol #Woodfields

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nsemkekanews · 19 days ago

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Ghana signs MoU with Jubilee, TEN fields partners to extend license to 2040 - Nsemkeka

Ghana signs MoU with Jubilee, TEN fields partners to extend license to 2040 – Nsemkeka The Government of Ghana, together with Tullow Oil plc, Kosmos Energy PetroSA, Ghana National Petroleum Corporation (GNPC) and Explorco have jointly announced that they have entered into a Memorandum of Understanding (MoU) to extend the West Cape Three Points and Deep Water Tano licences to 2040, which cover…

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ghananetnews · 7 months ago

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Springfield achieves milestone with successful appraisal of Afina discovery

Source: Joy Business Springfield Exploration and Production (SEP) Limited and its partners, Ghana National Petroleum Corporation (GNPC) and GNPC EXPLORCO, have completed the appraisal well test activity for the Afina discovery. This accomplishment reinforces Springfield’s position as the first independent Ghanaian and African energy company to operate a deep-water asset and make a hydrocarbon…

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andreagillmer · 7 years ago

Text

Volatility Breeds Contempt

Source: Michael Ballanger for Streetwise Reports 10/14/2018

Precious metals expert Michael Ballanger discusses the stock market volatility of the last week and what it may mean for precious metals.

Despite the U.S.-China trade friction, rising yields, weak overseas markets and increasing geopolitical tensions, the NASDAQ has been on fire while Canadian weed deals have dominated water cooler conversations for most of 2018. Volatility has been largely absent until last week, when it snuck into the upstairs bedroom under cloak of darkness and removed all cash and jewelry from the room. The S&P 500 (after Thursday's close) had given back 7.2% from its 2,940 peak seen in September when every anchor or commentator in the financial media was breathless with glee. S&P began the Friday session up a mere 2.05% YTD, which is still positive for the year, and remains superbly superior to gold's 6.24% decline since 2018 arrived.

In February and in May, gold and stocks were neck and neck but once the Donald decided to ratchet up the trade war, interventions became epidemic and the S&P quickly took off with gold doing the reverse. The gold gurus point to the "China Peg" as the bogeyman in the precious metals bedroom but the reality is that the algobots picked up the correlation and as they did with the gold-yen and the gold-euro pairs in earlier times, they tend to stay with the correlation "that is working" for longer than you can say "rational." I will refrain from debating whether it is a Chinese "policy" peg or an "algo-gone-anal" peg but the reality is that IF the West wants the Chinese currency UP versus the U.S. dollar, all it needs to do is move gold to $2,000 per ounce and the currency issues will be summarily corrected. (As will my net worth issues as well.)

Coupled with record shorts held by Large Speculators in both gold and silver, the potential for a short squeeze was high and rising then and even higher and rising now. However, I still need to see the dips be bought and the rallies left alone in order to convince myself that this is finally the point where money flows back into the U.S.-dollar denominated price of gold, which in turn will send the stock jockeys piling into the Junior and Senior Miner ETFs as well as the little explorcos. I believe this is an ongoing process that will accelerate as returns in the NASDAQ fade and money moves in search of alternative returns as happened in 2002 and late 2015. In Canada, as soon as the weed deals get crushed, money will also gravitate back to mining so the right course of action is to accumulate physical gold and silver in advance of this "Great Rotation" out of paper assets and into hard assets.

The frustration I feel lies in the truth that underlies the 2018 landscape; the elite class want the bankers, politicians and regulators to ignore 5,000 years of history. They would instead prefer to demand that their appointed central banker like Greenspan or Yellen or Powell simply follow the plan that was originated after the 1987 market crash and ensure that markets behave according to the carefully crafted script, which means gold and silver are the enemy, stocks are our saviors, and bonds don't count. As stated earlier, the bullion banks that have been pointed to as the major culprits in the gold and silver rigging scheme are now heavily positioned for an up move and have been since August. The inevitability of the Commercials crushing the hedge funds is the reason I expect the miners to begin to perform like the uranium/vanadium stocks, where REAL supply and REAL demand ex-interventions create a free and natural upward hydraulic so absolutely critical to properly-functioning markets.

This coming week will tell us whether can welcome a new paradigm for the precious metals or whether we simply devolve back into the status quo. Stay tuned and cross your fingers.

It is time.

Originally trained during the inflationary 1970s, Michael Ballanger is a graduate of Saint Louis University where he earned a Bachelor of Science in finance and a Bachelor of Art in marketing before completing post-graduate work at the Wharton School of Finance. With more than 30 years of experience as a junior mining and exploration specialist, as well as a solid background in corporate finance, Ballanger's adherence to the concept of "Hard Assets" allows him to focus the practice on selecting opportunities in the global resource sector with emphasis on the precious metals exploration and development sector. Ballanger takes great pleasure in visiting mineral properties around the globe in the never-ending hunt for early-stage opportunities.

Disclosure: 1) Michael J. Ballanger: I, or members of my immediate household or family, own shares of the following companies mentioned in this article: Western Uranium & Vanadium Corp. I personally am, or members of my immediate household or family are, paid by the following companies mentioned in this article: None. My company has a financial relationship with the following companies referred to in this article: Bonaventure Explorations Limited is owned by me and my wife and has earned consulting fees from Western Uranium & Vanadium in the past. I determined which companies would be included in this article based on my research and understanding of the sector. Additional disclosures are below. 2) The following companies mentioned in this article are billboard sponsors of Streetwise Reports: None. Click here for important disclosures about sponsor fees. As of the date of this article, an affiliate of Streetwise Reports has a consulting relationship with Western Uranium & Vanadium. Please click here for more information. The information provided above is for informational purposes only and is not a recommendation to buy or sell any security. 3) Statements and opinions expressed are the opinions of the author and not of Streetwise Reports or its officers. The author is wholly responsible for the validity of the statements. The author was not paid by Streetwise Reports for this article. Streetwise Reports was not paid by the author to publish or syndicate this article. Streetwise Reports requires contributing authors to disclose any shareholdings in, or economic relationships with, companies that they write about. Streetwise Reports relies upon the authors to accurately provide this information and Streetwise Reports has no means of verifying its accuracy. 4) This article does not constitute investment advice. Each reader is encouraged to consult with his or her individual financial professional and any action a reader takes as a result of information presented here is his or her own responsibility. By opening this page, each reader accepts and agrees to Streetwise Reports' terms of use and full legal disclaimer. This article is not a solicitation for investment. Streetwise Reports does not render general or specific investment advice and the information on Streetwise Reports should not be considered a recommendation to buy or sell any security. Streetwise Reports does not endorse or recommend the business, products, services or securities of any company mentioned on Streetwise Reports. 5) From time to time, Streetwise Reports LLC and its directors, officers, employees or members of their families, as well as persons interviewed for articles and interviews on the site, may have a long or short position in securities mentioned. Directors, officers, employees or members of their immediate families are prohibited from making purchases and/or sales of those securities in the open market or otherwise from the time of the interview or the decision to write an article, until one week after the publication of the interview or article. As of the date of this article, officers and/or employees of Streetwise Reports LLC (including members of their household) own securities of Western Uranium & Vanadium Corp., a company mentioned in this article.

Charts courtesy of Michael Ballanger.

( Companies Mentioned: WUC:CSE; WSTRF:OTCQX, )

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andreagillmer · 7 years ago

Text

More on that 'Deviant Conundrum'

Source: Michael J. Ballanger for Streetwise Reports 06/12/2018

Precious metals expert Michael Ballanger discusses the gold-silver ratio and the state of the precious metals market.

However, the purpose of this follow-up is to relay to one and all that the plunging GTSR is actually an extremely bullish indicator for the entire precious metals complex and bodes well for the deeply depressed junior explorcos that have all settled down into "survival mode" now that summer has arrived. As you may know, the month of June is seasonally flat-to-weak but that reverses in the July-November period so this may be the month that we get traction in ALL of the metals, and if silver's outperformance is any kind of lead indicator, then purchases of some of the well-positioned names could be quite a timely endeavour.

The greatest short squeeze of the year is now in full regalia as Elon Musk, the greatest stock operator since Bernard Baruch, has once again suckered the shorts into thinking that fundamentals actually matter. That his electric car company, Tesla Motors Inc. (TSLA:NASDAQ), is the most overpriced stock on the board is irrelevant; if you shorted the "technical breakdown" back in March at $330 and failed to cover in the ensuing crash to $247, you are now in serious trouble as TSLA has added $50 per share in the past week and sits at the $345 level. Could Musk take the stock to an all-time high north of $390? Of course he could, but my speculative instincts tell me that the stock is going to be hard pressed to get much above the current level with an RSI reading of plus-70. Now, do I mortgage the farm and bet it all on TSLA crashing to $25 (where it would still be overpriced)? Of course not, but because I am a dinosaur in a world of mutants, I will take a small position in the July $300 puts for $4.50 in an effort to bet against any thoughts of new highs. (At the time of this writing they were offered at $4.50 and traded down to $4.10. We were filled at $4.45 and they closed at $5.50.)

That Bitcoin and all of its cryptocurrency brethren have not seen the light of day anywhere close to the top back in December is particularly enlightening given the official statement of the CME boss shown above next to that now-fateful chart indicating that the "transparency, price discovery, and risk transfer capabilities" were actually the only way the bankers could get their greedy hands on a market that they had completely missed. I ended the December 11 missive (with BTC north of $16,000) with the following paragraph:

Lastly, last night I was in a discussion with a dear friend with whom I used to work back in the 1980s during which we were both lamenting the departure of human emotion from the trading pits. We were writing down a few notes regarding the differences in market behavior between the 1990s (arguably the biggest discovery decade in recent history) and today. We note that the junior mining market have never quite recovered from the 1997 Bre-X disaster that wiped $3 billion off the face of the Toronto and New York stock exchanges in a mere 30-day period. The regulations designed to prevent similar frauds in the future were highlighted by National Instrument 43-101, which requires that an independent, "qualified person" (described by five bullet points in the document along with two additional subsections) write a report prior to any public announcements by the company. In the pre-Bre-X days, companies would issue press releases with claims of "million and millions of ounces" and investors and speculators would pile into the stock because the tape was "dancin'" or that "rumors were flyin'" but after Bre-X, company officials could be fined or sanctioned with cease-trade orders if they violated this rule.

Which brought us to the topic of Novo Resources Corp. (NVO:TSX.V; NSRPF:OTCQX), which enjoys a $1 billion market cap and a massive legion of cult-like followers including my friend Bob Moriarty who has just written a truly fascinating commentary on Western Australia's Purdy's Creek "gold occurrence" and I purposely allude to it as an "occurrence" because, as the title of Bob's commentary suggests, "43-101 is a Noose Around Novo's Neck." When I was at the 2017 Beaver Creek conference in Colorado, whenever Purdy's Creek was mentioned, those with stock were the first to opinionize their knowledge and those WITHOUT stock (like me) were stoically and self-preservationally silent. Mickey Fulp and I were having a beer together and I asked him what he R-E-A-L-L-Y thought about the play and he basically said "Before I answer, this is totally OFF THE RECORD" to which I responded "Fair enough but WTF is it with Novo play anyway? Why is everyone so terrified of calling BULLSHIT?"

Level playing fields make for great entertainment and bias-free results.

Originally trained during the inflationary 1970s, Michael Ballanger is a graduate of Saint Louis University where he earned a Bachelor of Science in finance and a Bachelor of Art in marketing before completing post-graduate work at the Wharton School of Finance. With more than 30 years of experience as a junior mining and exploration specialist, as well as a solid background in corporate finance, Ballanger's adherence to the concept of "Hard Assets" allows him to focus the practice on selecting opportunities in the global resource sector with emphasis on the precious metals exploration and development sector. Ballanger takes great pleasure in visiting mineral properties around the globe in the never-ending hunt for early-stage opportunities.

Disclosure: 1) Michael J. Ballanger: I, or members of my immediate household or family, own securities of the following companies mentioned in this article: Tesla. I personally am, or members of my immediate household or family are, paid by the following companies mentioned in this article: None. My company has a financial relationship with the following companies referred to in this article: None. I determined which companies would be included in this article based on my research and understanding of the sector. Additional disclosures are below. 2) The following companies mentioned in this article are billboard sponsors of Streetwise Reports: None. Click here for important disclosures about sponsor fees. The information provided above is for informational purposes only and is not a recommendation to buy or sell any security. 3) Statements and opinions expressed are the opinions of the author and not of Streetwise Reports or its officers. The author is wholly responsible for the validity of the statements. The author was not paid by Streetwise Reports for this article. Streetwise Reports was not paid by the author to publish or syndicate this article. Streetwise Reports requires contributing authors to disclose any shareholdings in, or economic relationships with, companies that they write about. Streetwise Reports relies upon the authors to accurately provide this information and Streetwise Reports has no means of verifying its accuracy. 4) This article does not constitute investment advice. Each reader is encouraged to consult with his or her individual financial professional and any action a reader takes as a result of information presented here is his or her own responsibility. By opening this page, each reader accepts and agrees to Streetwise Reports' terms of use and full legal disclaimer. This article is not a solicitation for investment. Streetwise Reports does not render general or specific investment advice and the information on Streetwise Reports should not be considered a recommendation to buy or sell any security. Streetwise Reports does not endorse or recommend the business, products, services or securities of any company mentioned on Streetwise Reports. 5) From time to time, Streetwise Reports LLC and its directors, officers, employees or members of their families, as well as persons interviewed for articles and interviews on the site, may have a long or short position in securities mentioned. Directors, officers, employees or members of their immediate families are prohibited from making purchases and/or sales of those securities in the open market or otherwise from the time of the interview or the decision to write an article, until one week after the publication of the interview or article. As of the date of this article, officers and/or employees of Streetwise Reports LLC (including members of their household) own securities of Tesla Motors, a company mentioned in this article.

All charts and images courtesy of Michael Ballanger.

( Companies Mentioned: NVO:TSX.V; NSRPF:OTCQX, TSLA:NASDAQ, )

from https://www.streetwisereports.com/article/2018/06/12/more-on-that-deviant-conundrum.html

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andreagillmer · 7 years ago

Text

Month-End Shenanigans Everywhere

Source: Michael J. Ballanger for Streetwise Reports 04/30/2018

Precious metals expert Michael Ballanger discusses the gold and silver ratio.

“SHE-NAN-I-GANS” pronunciation: “SHəˈnanɡənz/” Noun informal 1. “secret or dishonest activity or maneuvering.” as in “widespread financial shenanigans had ruined the fortunes of many” 2. “silly or high-spirited behavior; mischief.”

To start off, I find it astounding that of all the ways that dictionaries might cite the usage of the word “shenanigans,” they elected to discuss it in its context to the financial industry and how shenanigans have “ruined the fortunes of many.” To wit, as we move into the month of May, we are entering the six-month period during which stock prices have historically faltered, setting up the old saw that one should “sell in May and go away.” I first used that phrase (which I have since grown to detest) back in 2009 when I determined that the TSX Venture Exchange at 737 was quite cheap relative to its 2006 high at 3,300 so I wrote one of my first pieces for Streetwise Reports entitled “Sell in May and Make Some Hay” after which the TSXV peaked at 2,400.

I thought then (as I do now) that the there was something rather odd occurring in the junior mining markets because while the blue-chip averages were in full recovery mode, the micro-cap explorcos were not getting any of the love being doled out by the Fed’s QE and Tarp programs. Investors were completely confident in the hot momentum stocks (like the banks) but were not terribly confident in the inflation beneficiaries like the gold miners, whose junior brethren were largely domiciled on the TSX.V. It seemed to me then (as it does now) that a hefty dollop of insidious “SHENANIGANS” was being carried out in covert fashion, the likes of which moved from the ridiculous to the sublime with the April (2011) massacre in the gold and silver markets that most certainly were to be found under the headline of “shenanigans” and most certainly “ruined the fortunes of many.”

Now, while not nearly the scope or breadth of the criminal collusion of 2011, the past few weeks have a similarly pungent aroma arising from the price behavior of a) stocks, b) volatility (UVXY), and c) gold and gold miners.

Shenanigation #1) Stocks: You will recall that I came out in late January of this year with the S&P 500 north of 2,825 and told the world that “it’s time for the beast to exhale” after which the S&P dropped like a stone to 2,352. That move was met with a couple of interventions with the first in February and the second in March at exactly the 200-dma. The color commentators on CNBC mentioned the 200-dma 87 times the day of the February bottom and 46 times during the day of the March bottom, while the phrase itself showed up in print over 10,000 times. The S&P 500 was up over 300 points from the February and March lows largely in anticipation of “earnings season” but in the past two weeks, both the S&P and the NASDAQ have been hobbled by a “sell the news” behavioral quirk, which, for me, is a sure-fire signal that bigger investors are viewing Q1/2018 as the peak for the business cycle.

Interestingly, we know now that the big boys needed a robust retail buying season in order to off-load their portfolio positions so the narrative was, understandably, that earnings would be “blow-out” and take stocks higher and that is the shenanigans that transpired back in February and March with the rescues at the 200-dma. The retail pitch sheet was constructed on the earnings outlook, not the tape action such that the brokers could say they were “right” about the EPS parade and hide under their desks.

Shenanigation #2) Volatility: Again, not to try to blow my own horn (at least not to any great degree), between January 16 and February 6, I fired off a number of tweets regarding volatility with a specific reference to the triple-leverage ETF (UVXY:US) that was sitting at $9.00 in mid-January and was the most heavily shorted ETF on the planet to the extent that even the new chairman of the Fed admitted that they too were short. So, since VIX-suppression has been a well-known but under-advertised mechanism used by the Criminal Interventionalists to juice stock prices, it appeared to me as the utmost “Fade the Fed,” contrarian, set-up trade EVER. As it turned out, I honestly did not expect them to allow the VIX much above 15 but it actually went to 49.61 and did so in a mere three weeks after I positioned myself for an upside “probe” in volatility without thinking it would be an upside EXPLOSION in volatility.

In sum, what backfired on the masses was that they were betting blindly that Fed shenanigans would continue unabated and that being short “VOL” was the “smart-money trade.” It might have been labelled “Shenanigans gone wild” because it turned out to be a highly satisfying trade from both a psychological and financial perspective.

Michael Ballanger‏ @MiningJunkie

Buying 1000 UVXY @ $9.10 STOP @ $7.95 target $50 by June 8:17 AM – 16 Jan 2018 Approximately 21 days later, I followed up with this tweet:

Michael Ballanger‏ @MiningJunkie sold another 30% UVXY @ $25 holding 20% of original position at cost of minus $7.31 7:06 AM – 6 Feb 2018

Shenanigation #3: Gold and Gold Miners: The third example of out right financial fraud was the price-capping farce we have experienced in gold and silver since 2011, which continues today amidst widespread acknowledgement by CEOs in their MD&As and in the forward guidance offered by companies using any commodity or energy caught in the crosshairs of the impending global trade war. Global trade wars (or even the threat of such) are not good for business and are, in fact, INFLATIONARY because of supply dislocations which cause price distortions.

So, with the recent spike in aluminum prices, why is it that a commodity seemingly about to be constrained by tariffs can spike 27% in eight weeks on “supply fears” while freighters full of gold are allegedly being off-loaded in Hong Kong with the paper gold trading volumes exceedingly annual mine output? As I wrote about last week, the machines are allowed to go berserk and assign valuations to commodities that have zero justification in fundamental analysis. The silver market appeared poised for a move to the mid-$18s around mid-March and based upon the massive and unprecedented aggregate short position being held by the Large Speculators, there was little doubt that the long series of bottoms in the $16.15-16.25 range would hold and I therefore went long after writing “Buy Silver with Reckless Abandon” on March 23.

The result was an approximate $1.00 pop in silver, which appeared to be nothing more than a short-covering orgy carried out in desperation by the Large Speculators based on the COT data from the coinciding period. What SHOULD have occurred was a prolonged and accelerated advance in silver prices as the shorts scrambled to find enough supply to fill their buy orders but because the Commercials were sitting there, ready, willing, and able to wave their magic wands and create fictitious “supply” by way of the Crimex, the squeeze was short, sweet, and relatively painless. This last act of shenanigans is “murder most foul” for analysts like me because it does actually represent the removal of my billfold from my trousers whilst standing unsuspectingly within a crowded room. Understandably, the glee I would derive from seeing a large piton driven into the forehead of a bullion bank behemoth after one of these episodes cannot be adequately imagined. It is THEFT, plain and simple.

So now that I have covered three areas of “secret or dishonest activity or maneuvering” that arrived miraculously at the end of the month and right the end of earnings season, I continue to view the best “short” for 2018 to be the sale of the Gold-and-Silver-Ratio above the 80 figure. The chart below is a short-term chart but you have seen the one I provided when I wrote the initial piece on the GTSR last week. As I have said many times before, it was the ratio at 85 in 2002 that triggered my decision to buy silver under $4/oz. and it is the GTSR over 80 that occurred again in 2008 and recently in late-2017. All three times what followed were significant declines in the ratio with 44, 32, and more recently 65 as the basing level.

Therefore, the Trade of the Week is going to be to add to the short of the GTSR in the supra-80 range on the assumption that within a reasonable period of time, the GTSR will react to gravity and plunge. I further urge all of the other quasi-analysts that look to silver as “nothing more than a byproduct” of giant copper, zinc, and lead mining operations might want to consider whether the notional value of the paper “hedges” carried on the books of the bullion banks might not represent the ultimate discounting mechanism. Perhaps carrying a paper short position analogous to four years of annual mine output might be sufficient to offset this “byproduct” effect which allows sub-economic silver onto the market without penalty. I say that the bullion banks have already gotten ahead of that argument and of that particular curve. It is the unwind of such that embodies the explosive horsepower of the trade. And it is the reason you should short it.

Disclosure: 1) Statements and opinions expressed are the opinions of Michael Ballanger and not of Streetwise Reports or its officers. Michael Ballanger is wholly responsible for the validity of the statements. Streetwise Reports was not involved in any aspect of the article preparation. Michael Ballanger was not paid by Streetwise Reports LLC for this article. Streetwise Reports was not paid by the author to publish or syndicate this article. 2) This article does not constitute investment advice. Each reader is encouraged to consult with his or her individual financial professional and any action a reader takes as a result of information presented here is his or her own responsibility. By opening this page, each reader accepts and agrees to Streetwise Reports’ terms of use and full legal disclaimer. This article is not a solicitation for investment. Streetwise Reports does not render general or specific investment advice and the information on Streetwise Reports should not be considered a recommendation to buy or sell any security. Streetwise Reports does not endorse or recommend the business, products, services or securities of any company mentioned on Streetwise Reports. 3) From time to time, Streetwise Reports LLC and its directors, officers, employees or members of their families, as well as persons interviewed for articles and interviews on the site, may have a long or short position in securities mentioned. Directors, officers, employees or members of their immediate families are prohibited from making purchases and/or sales of those securities in the open market or otherwise from the time of the interview or the decision to write an article, until one week after the publication of the interview or article.

Charts courtesy of Michael Ballanger.

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goldcoins0 · 7 years ago

Text

Month-End Shenanigans Everywhere

Source: Michael J. Ballanger for Streetwise Reports 04/30/2018

Precious metals expert Michael Ballanger discusses the gold and silver ratio.

"SHE-NAN-I-GANS" pronunciation: "SHəˈnanɡənz/" Noun informal 1. "secret or dishonest activity or maneuvering." as in "widespread financial shenanigans had ruined the fortunes of many" 2. "silly or high-spirited behavior; mischief."

To start off, I find it astounding that of all the ways that dictionaries might cite the usage of the word "shenanigans," they elected to discuss it in its context to the financial industry and how shenanigans have "ruined the fortunes of many." To wit, as we move into the month of May, we are entering the six-month period during which stock prices have historically faltered, setting up the old saw that one should "sell in May and go away." I first used that phrase (which I have since grown to detest) back in 2009 when I determined that the TSX Venture Exchange at 737 was quite cheap relative to its 2006 high at 3,300 so I wrote one of my first pieces for Streetwise Reports entitled "Sell in May and Make Some Hay" after which the TSXV peaked at 2,400.

I thought then (as I do now) that the there was something rather odd occurring in the junior mining markets because while the blue-chip averages were in full recovery mode, the micro-cap explorcos were not getting any of the love being doled out by the Fed's QE and Tarp programs. Investors were completely confident in the hot momentum stocks (like the banks) but were not terribly confident in the inflation beneficiaries like the gold miners, whose junior brethren were largely domiciled on the TSX.V. It seemed to me then (as it does now) that a hefty dollop of insidious "SHENANIGANS" was being carried out in covert fashion, the likes of which moved from the ridiculous to the sublime with the April (2011) massacre in the gold and silver markets that most certainly were to be found under the headline of "shenanigans" and most certainly "ruined the fortunes of many."

Shenanigation #1) Stocks: You will recall that I came out in late January of this year with the S&P 500 north of 2,825 and told the world that "it's time for the beast to exhale" after which the S&P dropped like a stone to 2,352. That move was met with a couple of interventions with the first in February and the second in March at exactly the 200-dma. The color commentators on CNBC mentioned the 200-dma 87 times the day of the February bottom and 46 times during the day of the March bottom, while the phrase itself showed up in print over 10,000 times. The S&P 500 was up over 300 points from the February and March lows largely in anticipation of "earnings season" but in the past two weeks, both the S&P and the NASDAQ have been hobbled by a "sell the news" behavioral quirk, which, for me, is a sure-fire signal that bigger investors are viewing Q1/2018 as the peak for the business cycle.

Interestingly, we know now that the big boys needed a robust retail buying season in order to off-load their portfolio positions so the narrative was, understandably, that earnings would be "blow-out" and take stocks higher and that is the shenanigans that transpired back in February and March with the rescues at the 200-dma. The retail pitch sheet was constructed on the earnings outlook, not the tape action such that the brokers could say they were "right" about the EPS parade and hide under their desks.

Shenanigation #2) Volatility: Again, not to try to blow my own horn (at least not to any great degree), between January 16 and February 6, I fired off a number of tweets regarding volatility with a specific reference to the triple-leverage ETF (UVXY:US) that was sitting at $9.00 in mid-January and was the most heavily shorted ETF on the planet to the extent that even the new chairman of the Fed admitted that they too were short. So, since VIX-suppression has been a well-known but under-advertised mechanism used by the Criminal Interventionalists to juice stock prices, it appeared to me as the utmost "Fade the Fed," contrarian, set-up trade EVER. As it turned out, I honestly did not expect them to allow the VIX much above 15 but it actually went to 49.61 and did so in a mere three weeks after I positioned myself for an upside "probe" in volatility without thinking it would be an upside EXPLOSION in volatility.

In sum, what backfired on the masses was that they were betting blindly that Fed shenanigans would continue unabated and that being short "VOL" was the "smart-money trade." It might have been labelled "Shenanigans gone wild" because it turned out to be a highly satisfying trade from both a psychological and financial perspective.

Michael Ballanger‏ @MiningJunkie Buying 1000 UVXY @ $9.10 STOP @ $7.95 target $50 by June 8:17 AM - 16 Jan 2018 Approximately 21 days later, I followed up with this tweet:

Michael Ballanger‏ @MiningJunkie sold another 30% UVXY @ $25 holding 20% of original position at cost of minus $7.31 7:06 AM - 6 Feb 2018

So, with the recent spike in aluminum prices, why is it that a commodity seemingly about to be constrained by tariffs can spike 27% in eight weeks on "supply fears" while freighters full of gold are allegedly being off-loaded in Hong Kong with the paper gold trading volumes exceedingly annual mine output? As I wrote about last week, the machines are allowed to go berserk and assign valuations to commodities that have zero justification in fundamental analysis. The silver market appeared poised for a move to the mid-$18s around mid-March and based upon the massive and unprecedented aggregate short position being held by the Large Speculators, there was little doubt that the long series of bottoms in the $16.15-16.25 range would hold and I therefore went long after writing "Buy Silver with Reckless Abandon" on March 23.

The result was an approximate $1.00 pop in silver, which appeared to be nothing more than a short-covering orgy carried out in desperation by the Large Speculators based on the COT data from the coinciding period. What SHOULD have occurred was a prolonged and accelerated advance in silver prices as the shorts scrambled to find enough supply to fill their buy orders but because the Commercials were sitting there, ready, willing, and able to wave their magic wands and create fictitious "supply" by way of the Crimex, the squeeze was short, sweet, and relatively painless. This last act of shenanigans is "murder most foul" for analysts like me because it does actually represent the removal of my billfold from my trousers whilst standing unsuspectingly within a crowded room. Understandably, the glee I would derive from seeing a large piton driven into the forehead of a bullion bank behemoth after one of these episodes cannot be adequately imagined. It is THEFT, plain and simple.

So now that I have covered three areas of "secret or dishonest activity or maneuvering" that arrived miraculously at the end of the month and right the end of earnings season, I continue to view the best "short" for 2018 to be the sale of the Gold-and-Silver-Ratio above the 80 figure. The chart below is a short-term chart but you have seen the one I provided when I wrote the initial piece on the GTSR last week. As I have said many times before, it was the ratio at 85 in 2002 that triggered my decision to buy silver under $4/oz. and it is the GTSR over 80 that occurred again in 2008 and recently in late-2017. All three times what followed were significant declines in the ratio with 44, 32, and more recently 65 as the basing level.

Therefore, the Trade of the Week is going to be to add to the short of the GTSR in the supra-80 range on the assumption that within a reasonable period of time, the GTSR will react to gravity and plunge. I further urge all of the other quasi-analysts that look to silver as "nothing more than a byproduct" of giant copper, zinc, and lead mining operations might want to consider whether the notional value of the paper "hedges" carried on the books of the bullion banks might not represent the ultimate discounting mechanism. Perhaps carrying a paper short position analogous to four years of annual mine output might be sufficient to offset this "byproduct" effect which allows sub-economic silver onto the market without penalty. I say that the bullion banks have already gotten ahead of that argument and of that particular curve. It is the unwind of such that embodies the explosive horsepower of the trade. And it is the reason you should short it.

Originally trained during the inflationary 1970s, Michael Ballanger is a graduate of Saint Louis University where he earned a Bachelor of Science in finance and a Bachelor of Art in marketing before completing post-graduate work at the Wharton School of Finance. With more than 30 years of experience as a junior mining and exploration specialist, as well as a solid background in corporate finance, Ballanger's adherence to the concept of "Hard Assets" allows him to focus the practice on selecting opportunities in the global resource sector with emphasis on the precious metals exploration and development sector. Ballanger takes great pleasure in visiting mineral properties around the globe in the never-ending hunt for early-stage opportunities.

Disclosure: 1) Statements and opinions expressed are the opinions of Michael Ballanger and not of Streetwise Reports or its officers. Michael Ballanger is wholly responsible for the validity of the statements. Streetwise Reports was not involved in any aspect of the article preparation. Michael Ballanger was not paid by Streetwise Reports LLC for this article. Streetwise Reports was not paid by the author to publish or syndicate this article. 2) This article does not constitute investment advice. Each reader is encouraged to consult with his or her individual financial professional and any action a reader takes as a result of information presented here is his or her own responsibility. By opening this page, each reader accepts and agrees to Streetwise Reports' terms of use and full legal disclaimer. This article is not a solicitation for investment. Streetwise Reports does not render general or specific investment advice and the information on Streetwise Reports should not be considered a recommendation to buy or sell any security. Streetwise Reports does not endorse or recommend the business, products, services or securities of any company mentioned on Streetwise Reports. 3) From time to time, Streetwise Reports LLC and its directors, officers, employees or members of their families, as well as persons interviewed for articles and interviews on the site, may have a long or short position in securities mentioned. Directors, officers, employees or members of their immediate families are prohibited from making purchases and/or sales of those securities in the open market or otherwise from the time of the interview or the decision to write an article, until one week after the publication of the interview or article.

Charts courtesy of Michael Ballanger.

from https://www.streetwisereports.com/article/2018/04/30/month-end-shenanigans-everywhere.html