Gold/Copper Ratio Surges By Most Since June 29

Tyler Durden's picture

As Credit Suisse points out, today the Gold/Copper ratio is up by over 4% to 3.32, which happens to be the biggest one day move since June 29, and confirms that not only the copper run may be over, but that derisking and the flight to safety trade is truly back on. Although one hardly needed to see this chart to come to that conclusion: even as the market continues to expect an announcement from Bernanke that CTRL-P Central (f/k/a the Marriner Eccles building) will start printing crude any minute, the wait may end up being quite protracted. And while gold has not been touched yet, and in fact continues to trade at all time highs, we wish to repeat our warning that should the crunch in the S&P continue (even if it is modest by historic amounts), it is very likely we may see liquidations in HF precious metals holdings considering the HF margin debt position is at virtually all time highs, meaning the toxic spiral of plunging prices and broad deleveraging in advance of margin calls, will lead to a sell off in anything and everything that is not nailed down.

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trav7777's picture

price action in Pd and Pt also worrisome...bitchez

asdasmos's picture

Realty Mogul, Sam Zell, Talks Inflation - says we're not seeing inflation because the CPI is distorted. (Mar. 3 2011)

Math Man's picture

And what happened in the 30 days after June 29, 2010....

Gold and silver went down 6% and the S&P went up 2.5%.


tmosley's picture

Yes, because there has never been such a thing as a correction in any bull market.

Sorry, boy, you're early or wrong.  Either way, you're a loser.

nope-1004's picture

If Silver drops 6%, I'm all over it like white on rice.  And since I bought my largest chunk at $26, no need to even lose any sleep, frankly.  If it drops 20%, I might start to pay attention.



IQ 145's picture

 Agreed. If it's off 6% I'll be in there right beside you, helping to put that "white on the rice".

clickjaw's picture

Math man is RNR. He's a Soros paid troll!

NotApplicable's picture

I would've thought that Soros could get a lot better ROI than that!

mt paul's picture

it's hard to beat 

6 $ silver ...

no matter how big 

your correction stick is ...

speak softly but

buy every freakin dip....

EscapeKey's picture

How does your disinformation database work? Do you search by keywords, or do you search for a preconceived conclusion you want to come to, and then it automatically cherry picks the data to suit that basis?

How much does it pay? Do you work from home?

Salvatore CFA's picture

Salvatore bats second, the Middle Finger dude, leadoff.

Beat Turd to the punch.

The ratio will continue this trend.

Mongo's picture

Don't miss the IMF pressconference from IMF HQ about how they will enslave the entire human race...

Diplodicus Rex's picture

Sorry, for the uninitiated, what does HF mean? High Frequency?

JohnG's picture

Hedge fund in this case.

HFT - High Frequency Trading

BTFD - Buy the fucking dip


We need a glossary....

disabledvet's picture

well...that's it.  "those two."  that would "the glossary."  when they say "it ain't rocket science" they ain't kiddin'.

Silver Pullet's picture

Need one more.

Whats "FUBM"?

After it a suggestion to Blythe?

Oh regional Indian's picture

HF's mostly hold SLV. Paper in some form. their sale will only move the fiat monkey around.

Physical problems will remain.

I do believe, in a classic inversion sue to these generally inverted and invereting times, Freegold will actually prove to be freeSilver.

Good to ask the deeeeeper questions. 

The obvious is never true.


Temporalist's picture



HF isn't on there though (hedge fund wannabes is) and neither is HFT (although High Frequency Trading is maybe they should put the initials for the masses), BTFD isn't either...someone needs to do some updating.

Diplodicus Rex's picture

Thanks for the glossary lesson. I'll go back to watching Strictly Come Dancing now.

drink or die's picture

Can we revalue our currency in terms of oil?  That way we could print oil, just by saying it is "future oil discoveries".

hedgeless_horseman's picture

Good news, Velobabe!  Sugar Daddies are rolling in it:

The rich are different from you and me: They're buying real estate.


After four straight years of declines, sales of million-dollar homes and condos rose last year in all 20 major metro areas, according to DataQuick Information Systems. On average, these cities saw an 18.6% jump in high-end home sales.

Confucious 222's picture

Who knew Anna-Lisa Klittersberg made that much dough?

Must be exciting, or excitable.

chumbawamba's picture

Well, with a name like Klittersberg, excitability is a daily phenomenon, I'm sure.

I am Chumbawamba.

serotonindumptruck's picture

The elevation should save them from the massive tsunami and EQ events over the next couple of years. Their proximity to the Yellowstone caldera should be of some concern however.

Goldenballs's picture

Just sell what dosen,t exist,everyone else is.

LOWNskater52's picture

Please let there be a massive PM liquidation on Friday.  That is when I'll get my paycheck and be able to stock up big time.

disabledvet's picture

i like that.  won't happen.

savagegoose's picture

so the gold price is levereaged to buggery?

a drop isnt a flight to safety its a flight to delevering?

slewie the pi-rat's picture


one person's drop in buggery may well be another person's flight to delevering!

Bastiat's picture

Physical demand will choke off any selloff in PMs, imho.  A collapse of PM futures prices -- essentially derivatives due to the 100/1 leverage off the physical -- will get arbed.  Insane volatility will result but not sustained collapse in PM prices.

trav7777's picture

do not underestimate the futures markets' ability to move price, at least in the short term, in a counterintuitive direction.

However, there will be strong buying support in a safety trade.  Remember, though, that if the deflationists are correct, then the entire $50T Z1 credit base will unwind and gold will return to $23/oz.  The price of everything else will collapse as well and bank deposits, bonds, stocks, etc., will vaporize with the FRN.

Even in the 2008 deleveraging, physical gold could be had for not so much more than spot.  As the stresses increased, availability shrank and retail dealers were forward selling supply not on-hand.

On the flipside, with the margin hikes implemented by various exchanges, they've already pre-chased some of the leverage OUT of certain commodities, inc. gold and silver.

Bastiat's picture

In the mean time it's nice to see Blythe getting it on her silver position and copper position at the same time.


TradingJoe's picture

Until Oil reverses course, we won't see ANY meaningful "correction" or sell off of any kind or magnitude! When the oil trade is over so will the S&P hit the wall! And PMs(paper) and all other stuff!

May the crude trade be your last "perfect" one before we hit the beaches! And leaving behind a "wall of warring" PUTS :)))!

TWORIVER's picture

The Head and Shoulders present in the weekly Copper chart is likely an important top for the whole commodity space and we should see a massive revaluation lower across the board in the coming weeks. The US$, whatever you think of it, is going to rally strong as well.

trav7777's picture

didn't you just say that about the miners space?  Then it failed to confirm the H&S

Rogerwilco's picture

Confirming Dr. Coal's H&S of recent. In a couple of months the bag holders will be shaking their heads, wondering how they could have been so stupid buying into the parabolic blow-offs.

chumbawamba's picture

Copper to $10/lbs by end of summer 2011.

I am Chumbawamba.

Bastiat's picture

It's a known fact that chart formations create physical supply.

TWORIVER's picture

No they do not do that but they do show the supply/demand relationship very well. We'll see what happens over the next few weeks. The $/CHF is probably the best place to be to benefit from the probable rally coming up.

Bastiat's picture

No they do not do that but they do show the supply/demand relationship very well.

. . . in healthy, functioning markets that are driven by supply/demand.  This would not describe precious metals, ihmo -- although silver is phase shifting towards price discovery.

topshelfstuff's picture

[ covers/ their Silver Short, and BTW the Gold/Silver Ratio broke through 40 today. It was just above 70 when Chna "urged" their citizens to Buy Silver.

JP Morgan Denies It Holds More Than 90% Of The Copper Market... No Statement On Whether It Holds 89%


Steroid's picture

Gold to copper ratio? This is an abomination here.

For god's sake, the inverse is the (real) price of copper.

What has the world degraded to!!

depression's picture

Please I pray someone just recorded this interview with Jim Cramer talking about the Oil market, opening the SPR, what did he say "Obama needs to show this futures market who is in control here... ". This is stunning. Please someone post this interview.

baby_BLYTHE's picture

IS inflation[dot]us a scam?

I REALLY HATE snake oil salesmen!