Pop tomorrow, bear raid later?

1:06 pm (Hawaii) Makes sense to me. As Jesse says, the last time there was a PM pop on options expiry, a massive bear raid on the following three-day weekend ensued. We're entering a similar scenario this week. I was already planning to cash out before the weekend.

Dan Norcini: Fed's Bullard gives commodity rally green light (May 24 2011)

Jesse's Cafe Americain: Options expiry on Comex tomorrow, if they can't bring prices down, watch for bear raid this weekend (May 24 2011)

Update 4:35 pm (Hawaii) Here's the perspective of the eccentric genius, Le Fly, who is taking precautionary measures (as always) for an inflationary environment. He expects some form of QE3 to start sooner or later, lest Greece default, the Euro banking cartel collapse, and drag the US into the gutter with them.

iBankCoin: The cost of inaction is too great (May 24 2011)

Update 11:58 pm (Hawaii) A quick look before bedtime was worthwhile. Spot Silver up at 37.15. Brother Turd noted that there is little resistance to 39. We shall see soon enough!

Turrbll Tuesday?

8:27 am (Hawaii) Got a good night's rest, woke up an hour ago to see Spot Silver trapped at 45. Makes sense, this being precious metals options expiration. A month ago, 45 seemed out of the stratosphere, but attainable. Well, 49 was penetrated, and this pullback to 44, and back up to 45 is within reason — all manipulations and agendas included.

From where, we have Bernankepalooza tomorrow. If all things remain status quo and the slightest hint of QE3 is uttered from Benjamin's lips, the bull stampede resumes. For now, I'm content to stay in 100% cash. Trying to time Spot Silver here is too much. I can see a small entry position at 44.50 or 43.50, but nothing more. This could dip to 40 in minutes. Then Spot becomes very buyable; global demand won't allow a drop below 40. I'd put chances of a bounce there at 99%.

Meanwhile, gold miners are spiking. XG (+6.8% to 9.41) and NGD (+2.4% to 10.74) are among the big gainers on my watch list. On the other hand, silver miners are eating dirt. EXK is down 5.4% (10.72), SLW (not a miner, but trades with them) is down 4.5% (39.17). PHS, PAAS and PSLV are all down substantially.

Crude oil? UCO is up fractionally, but WNR is down 4.3% (17.88).

Other news include Facebook getting more into coupon/deal service to challenge Groupon. IPOs in Groupon and Facebook are going to be massive one day.

Spot vs. Shorties & Bernankepalooza

11:48 am (Hawaii) Spot Silver climbing off the mat, now 46.98. A couple of notes: For a third (or fourth?) consecutive session, Spot has rallied after the London market closes. Today, London was closed all day, though, and Spot erupted during the usual time frame. Just a couple more hours until Hong Kong opens for Tuesday trading. How can HK/China not be bullish of Spot Silver when it is practically economic policy to invest in it? A tough call here, but worth considering. Ultimately, the specter of PM options expiry (Tuesday) and Bernankepalooza (Wednesday) are two big guillotines to face. 

Update 12:03 pm (Hawaii) As Turd Ferguson predicted, a margin hike spared the big money that bet against Spot Silver. Here is his post about manipulated (or manipulative) media, the Cartel and more. This explains the big drop from 49 to 46 earlier today. 

I still think that the highest likelihood probability is for silver to head down again tonight and tomorrow and retest the lows of this morning, near 45.50. It may even make it all the way down to $45. Again, IF that happens, I will be an aggressive buyer of July calls as I expect a move toward $50 or even $52 by late next week.

I wouldn't bet against the Turd. Ever.

Update 7:39 pm (Hawaii) Work is done (I think) and it's time to check Spot Silver ... which is tanking. I didn't expect Hong Kong to send Spot into the gutter, but hey, it won't be forever. In fact, this dip to 45 is healthy as long as you cashed in that short-term position on Thursday or early this morning.

Thirty-six long hours until we're done with PM options expiry and Bernankepalooza. Then, maybe then, the Silver Rocket takes off past 50. For now, just like King Turd predicted, the evil forces have taken Spot Silver downward. It won't last.

Update 11:01 pm (Hawaii) Spot Silver climbing back up down under and in HK. Traders who access the currency markets ... I'm a wee bit jealous. Spot may touch 45 again sometime on PM expiration Tuesday ... but maybe not. Note how the price levitates once Sydney closes, leaving only Hong Kong to trade spot. They ain't forkin' around in East Asia. The Chinese have Big Brother "encouraging" the purchase of silver, silver and more silver. 

Here's a clip of Peter Schiff, who was on Fast Money on Thursday. He's spot on, of course, pun intended. 

Update 11:08 pm (Hawaii) Just a wild guess on whether we see QE3 or not. A few days ago, I'd have leaned against it happening. But with all the chess moves made by China recently, plus Japan's pension situation, plus kookiness in Euroland ... I'm guessing 65% we get QE3, 35% none. 

Doesn't mean I'm diving into the shark pool headfirst before Bernankepalooza on Wednesday, but I'm trying to get a better feel for the climate. 

Update 11:39 pm (Hawaii) And finally as midnight approaches in the islands, a word from Harvey Organ: 

In silver: the bankers are not covering yet which is a big surprise as they are still adding to their short position. The large specs continue to pile it on hoping for the end game to be played out. The game is between the large specs vs the commercial bankers. The large specs have enormous amounts of dollars to play long.

The bankers have enormous amounts of lent dollars from the Fed placed for collateral against billions of paper losses. Without a doubt there will be an epic battle on this front.

Spot silver now at 46.05. When I get back home in a couple of hours, it could be right back at 45. Spot's traded higher in Hong Kong than London, the latter being open for a few more hours and the former just closing shop.