HOW BAD CAN IT GET?

                                            Never Say Never

One of the most worrisome things I see in the marketplace [pick one, any one] is the outright selected manipulation of currency pairs, stock prices, bond prices, and of course precious metals. It doesn’t always have to be direct intervention; most often in the currency pairs it is selected, timed, press releases to inflict the most harm.

Our friends at the BOJ, MOF, IMF, BIS, and a host of others, all play the manipulation intervention game.

The reason I bring this up is to highlight the eventual futility of this process. Sooner or later, the math works out the right way; of course you could be broke by then, but that’s your problem, not one for the market.

Take gold for instance; priced as I write at $1564, it’s 20% off its high from August 2011. Is there any person alive who really thinks anything in the world is better off from 10 months ago? Is Europe in better shape? Is the U.S. fiscal and monetary condition better? Has the deficit gone down? Have the money printing presses stopped or even slowed down?

Of course not, everything is worse.

For us traders, it is particularly hard to ignore the waves [tsunami’s really] of massive buying/selling that hit markets in a microsecond and can make the difference between having a nice day and trying to recover for the year. Go ahead, ask me again how much I hate gold dealers?

One thing is for sure; you can never say never when trading.

“Oh, I’m not worried, there’s no way the Euro can go down/up from here. No need for a stop.”

In case you are wondering, the photo above comes from the Rio Casino in Las Vegas, where the number 19 was hit in roulette 7 times in a row. The odds of this happening is 114 billion to 1.

“Nah, no way can we get another 19.”

“Uhm yea, OK.”

Next time you make a trade, think about this for a second.

Have a good day everyone.

-vegas

HEY EUROPE SHUT UP

                                              Trader Manual

It seems like every day Europe sells everything in sight, then when they close at about 9:30 A.M. [Chicago time], as if somebody shuts the lights off, markets turn on a dime and rally like crazy into the close. Rinse and repeat almost every day.

It’s frustrating dealing with these European bozos on a constant basis. They skew gold, the currency pairs, and equity and bond markets; close them down and markets trade on a more normal basis. Why should today be any different?

I thought the “Lemmings in Asia” were a pain; they’re nothing compared to the unbridled selling of everything with a $ sign on it just so they can keep their bankrupt banks alive for another day.

If I could round up every politician, I’d line them all up against the wall and ………

Today we find out from the politicos that Greece has no money and maybe they shouldn’t get any more; gee, ya think? And Spain nationalized some banks; yea, that will solve the problems. Of course, this hammered gold and the currency pairs, and within minutes we were sharply higher. Seems somebody had to get the final sell stops below the market.

Go ahead, call me cynical, but the outright blatant manipulation going on is shocking to me. Sure, I have seen a lot of things in my trading career going back into the late 70’s, but I haven’t seen anything like this. It’s breathtaking and disturbing at the same time.

Have a good day everyone.

-vegas

NEW RULES FOR SOCIALIST TRADING

                             Chairman: Gold Manipulation Team

Fresh off my May Day celebration yesterday, in which I put on my Ché t-shirt and watched with glee as some Occupy protestors got their heads beat in, I bear the heavy responsibility of sharing with my comrade readers the rules for the new paradigm.

The United Socialist States of America (USSA), or better known as Amerika, has embarked upon [for the benefit of the children of course] actively trading gold for the sheeple. Since they openly manipulate intervene through Primary Dealers [read JPM and The Squid] in practically all other financial markets [equities and bonds] it’s only natural they now start losing billions trading gold.

Rule #1: What happens in Asia stays in Asia

Too busy playing pochinko; worrying about N. Korea; reading porn-themed comic books and watching anime; and commuting into and out of radiation zones, any and all $3 - $5 range moves put in during the Asian session mean absolutely nothing as far as the rest of the day goes.

Rule #2: Pay attention to the following times for Central Planner intervention

2:00 A.M. [Chicago time]; 7:20 A.M. to 8:00 A.M [Chicago time]: this represents the European open and the U.S. open (40 minute window for economic reports) respectively. Increasingly, Chairman Hopeless likes to use economic reports to do the People’s manipulation trading to give cover to the activity.

Rule #3: Expect [manipulation] trading activity every trading day

The sharp spikes/drops are here to stay; use them to your advantage and look for them to exit positions. Chairman Hopeless doesn’t care about making money; we do. They don’t actually have to execute orders to be effective; the People’s broker of choice, JPM, will front-run large resting limit sell orders for their own benefit. All with the blessing of Chalky Soetero and the rest of the socialist team.

“Remember children, gold is evil; report all parental suspicious activity to the TSA.”

Rule #4: Traditional technical analysis of charts is useless

Members of the Peoples Trading Team can read charts too; they will use their knowledge to manipulate trade when they think you are going to do something based on common chart patterns you know you use.

“How dare you trade against the People; you deserve to lose money.”

It is important to realize that their purpose is to hurt you. My purpose, and the algorithm’s, is to hurt them.

Meanwhile, back in food stamp nation …

Have a good day everyone.

-vegas

MANIPULATION THEORY PART II: IT’S BINGO NIGHT

                                      Murray As The Bernank

I got a pile of money in front of me and I’m sitting next to a blue-haired lady who weighs 96 lbs. soaking wet …”Just put the little markers on the numbers” she says to me leaning over …”B26!!” Murray screams out …She jumps about 2 feet in the air and yells “BINGOOOOOOO!!!!” at the top of her lungs …pandemonium ensues …my head is whirling around as people from everywhere descend on our table …I’m engulfed by geezers …I look around and I’m the youngest guy in the room by about 20 years …

I awaken just in time for the 7:20 A.M. open and we don’t even have a $5 range after 15 hours of trading. I’m guessing that they are too busy playing pachinko in Asia and rioting in the streets in Europe to trade.

But then at 7:32 A.M., in one second, gold gaps lower by $15 [from 1659 to 1644]. All I can think of is B26. Clear the tables, tear up the last bingo card, and place your new bets.

If you listen to the financial press, they will say it was due to the disappointing consumer spending numbers that came out at 7:30 A.M. [Excuse me, I just choked on my poptart.]

“Hey, anybody wanna buy some beachfront property in Colorado?”

As I warned on Friday in my post, they’re gonna stop you out if you stay long. Today’s action totally reinforces the manipulation theme. Who do you think was selling to you on Thursday and Friday? And who do you think was buying your sell stop today on the “B26” $15 gap lower? And when it was all over, who spends the rest of the day covering shorts from Friday?

“Gosh Mr. Regulator, we were buying all day. Sorry, we can’t comment on customer activity.”

So, what kind of fool puts in a very large order and totally skeeeeeeeews gold for a few seconds so it goes $15 lower? Easy Pezee; somebody who doesn’t care about his fill, and who cares more about hurting speculators than making money. Welcome to rule #2 for successful manipulation; hurt any and all traders as badly as possible.

“Errr vegas, I’m starting to connect the dots.”

The fact is they don’t even care anymore about being so blatant even Grandma can see the manipulation.

Except for the few idiots in Asia and Europe, who haven’t gotten the email yet, trading is almost nonexistent as nobody wants to do anything ahead of Fed manipulation later in the day.

“Why buy now? I may be stupid but I’m not crazy. Hey, gimme that pachinko coin!”

If you’ve come to the conclusion this makes no sense, you would be right in a sane and just world where “free markets” trade. Unfortunately that world no longer exists: we are in a new paradigm.

And now that the chuckle moving news is over, buyers have come back in and rolled the rock back up the hill to the $1660 area again. Don’t make me explain to you what happens next.

We used to have regulators who would put people in jail for stuff like this. Oh, wait a minute, it’s the Feds doing it now so it’s OK; when your doing God’s work here on Earth anything can be rationalized.

“Viva JPM and their mystery customer!!”

Excuse me while I go puke.

Have a good day everyone.

-vegas

MANIPULATION THEORY: PART I

                                          A Stain On Trading 

“Gosh vegas, is there really manipulation going on?”

For those of you still in denial, there isn’t anything I can do for you; you probably still believe in the tooth fairy.

I mentioned in an earlier post some of the hallmarks of successful manipulation. I’m going to address the 3^rd issue first: make sure the manipulation counts.

Aside from the front-running at the JPM proprietary trading desk [prop desk], which is another story for another day, you need a financial firm that can handle the orders and give you cover. What better firm than JPM, which continues unabated every single day violating CFTC position limits and is defendant in a number of Federal lawsuits alleging manipulation?

“Hey, you play ball, we make all these other problems go away; sound good to you guys?”

Ok, you now got the quid pro quo that allows you total access to the financial markets without revealing your identity. We let you front-run; we get anonymity.

“So sorry, we don’t comment on customer activity.”

Next on the list are the “wink wink nod nod” conversations and communications that don’t exist. This allows the front-running to be successful on JPM’s part because they trade in front of the orders and use the size of the manipulators orders to their advantage.

“C’mon man, there’s gotta be something in this for us?”

Besides that, they are privy to when the large sell orders are going to hit the market, so they can position themselves to cover short positions on the way down for their own account. This is borne out by CFTC COT data which shows “commercials” as the biggest buyers on big down days.

Gosh Mr. Regulator, it wasn’t us. Why, we were buying all day long. Anything else we can do to help?”

So, in effect they execute one order and the market does the rest. They get all the chartists and traders rushing in their orders to take advantage of the “new direction”, only they have been had. This explains why the “Lemmings in Asia” [LIA] have disappeared in the last 4 to 6 weeks; they’ve wised up. They now wait and buy the breaks.

Ask yourself this question: why do practically all of the big spikes and drops happen in the U.S. trading session? Easy peezee when you get what’s going on day to day.

This is the new paradigm for gold trading; manipulation on a scale that, up until now, is unprecedented. Get used to it, it’s only going to get worse and more blatant; all in the interests of national security or some such pap they will spin.

Why should you, as a trader, be allowed to profit off the government and their stupidity? I can see the puppets in the media spinning this already. Why not, Chalky Soetero has already declared war on oil traders?

I revised the algorithm to take advantage of these manipulations; it’s available free of charge for traders at the “Get It For Free” at the link.

Have a good day everyone.

-vegas

COLD CASE GOLD

                                      Just The Facts Ma’am

It didn’t take very long from the heady and jubilant days of yesteryear; back in the day when gold actually rallied and stayed there, to get and keep the trading community long gold. What could possibly go wrong?

I am, of course, referencing last Thursday when it appeared to the entire trading world that gold was about to go orbital after 3 days of almost $50 gains.

“Ahhhhhhhh, for those ancient days…..”

Yes, dear truth seeker, gold has gone cold. Even a causal observer, looking at the daily chart of gold, can see lower highs on rallies and lower lows on breaks. Not exactly trading rocket science.

“Errr, wait a minute der vegas, we got guberments all over da world printin’ money and inflatin’  everything. Gold just hasta go higher!”

“Ahhhh, no it doesn’t.”

It only has to go higher the second you blow your account out and have no money left to trade; as a byproduct and in accordance with the laws of the universe, it will then drive you completely nuts.

The Central Planners went to college just like you [only they passed English 101]; they can read, they can think and they aren’t stupid. They went to the Barnes & Noble store just like you and bought the following:

Sure, they can read charts just like you; only they don’t care if they make money while you hopefully do. All of the traditional and most popular technical indicators you read in that stupid book aren’t going to make you money; the Central Planners will make sure of that.

What they will get you to do is buy the highs and sell the lows; you’ll be Pavlov’s dog only you won’t know it. The central tenet of proper  manipulation is to get the trading public to do the buying/selling after the manipulators strike the match; no fingerprints.

So, next time you go absolutely apoplectic because there is a breakout on the “charts”, and you go all in with no stop, remember what the dog in the cage does when the whistle blows.

Have a good day everyone.

-vegas

THE GIG IS UP

                                           This IS Important

Sooner or later the beans had to be spilled. I mean, you can’t keep this stuff a secret forever can you?

I am referring of course to the blatant manipulation of gold led by the U.S. Government and their lapdog institutional hacks JP Morgan [JPM] & HSBC [HongKong & Shanghai Banking Corp].

Two excellent articles, yesterday and today, over at www.zerohedge.com prove my point. Below are the two links in case you missed them:

http://www.zerohedge.com/news/chris-martenson-explains-how-gold-manipulated-and-why-thats-okay#comment-2298764

http://www.zerohedge.com/news/paul-mylchreest-presents-various-visual-case-studies-gold-price-manipulation

Although I have known for years, and have witnessed first hand in the gold trading pit, the blatant manipulation of prices, I didn’t really know exactly the extent of the numbers.

In a nutshell, gold has risen approximately 590% in the last 11 years; if you had simply bought gold at the U.S. open and closed your position at the U.S. close of trading you would have lost 70% over this 11 year period.

In this same 11 period, if you had been long from the Asian open through the European session until the U.S. open AND then gotten short from the U.S. open until the close where you liquidated the short position, you would be up over 5,000% !!

How many of you knew this?

For me, it perfectly explains the “Lemmings in Asia” phenomena, and why my algorithm works so well the vast majority of the time gold rises. I will be the first to tell you, and I have said this in the algorithm manual, that my algorithm has a very definite long bias.

I get emails all the time asking me why I start trading gold at about 11 PM or Midnight [Chicago time]. This time is about half way through the Asian session and goes from there. And this data also helps explain why so many of the algorithm profits come in the early AM hours of the U.S. time zones.

The second document talks about the algorithms the government uses to initiate their manipulation. Fascinating stuff and I highly recommend you read both documents closely.

Both JPM & HSBC have historically held extremely large short positions in both silver and gold futures and options. They both regularly exceed speculative position limits established by the CFTC [that everybody else has to respect] but nothing is ever done about it. The end justifies the means when you are doing God’s work.

Have a good day everyone.

-vegas