Thursday , 7 December 2023

Goldrunner: Fed’s Review of Banks Trading In Physical Commodities A Pivotal Moment For Gold

Gold has busted up on the open to take out the $1300 resistance. This article precious-metalsexplains the reasoning for that move, why it is so pivotal in nature and what to expect in gold pricing action over the short term.

So writes Goldrunner ( in edited excerpts from his latest subscription* newsletter, posted here with permission, entitled Pivotal Moment for Gold?.

[The following article is presented by  Lorimer Wilson, editor of and and the FREE Market Intelligence Report newsletter (sample here – register here) and may have been edited ([ ]), abridged (…) and/or reformatted (some sub-titles and bold/italics emphases) for the sake of clarity and brevity to ensure a fast and easy read. This paragraph must be included in any article re-posting to avoid copyright infringement.]

Goldrunner goes on to say in further edited (and in some instances paraphrased) excerpts:

In the past we have discussed how the Glass-Steagall Act repeal effectively allowed the Fed Banks to move out of the banking realm to trade in everything in the market and, as such, the Fed Banks have been able to completely manage all of the markets with the use of paper leverage since they know in advance what the Fed is going to do and going to say.  To put it more simply, they have been able to front-run everything with huge leverage. That may be about to change, however, with the announcement over the weekend by Reuters that the Federal Reserve was going to review allowing banks to trade in physical commodities.

The Fed and its banks would have known this end of pure control was coming which would go a long way towards explaining why the total “in your face” paper shorting of Gold, Silver, and PM Stocks that we have seen occurred. In fact, with this news, we might be seeing the final fling of the Fed Banks in terms of complete control of the markets.

Another bit of news from the last couple of weeks may well have cemented this in place when it was announced that some of the Fed Banks were being sued over the use of unfair practices of the OTC Derivatives they sold as insurance on the European Banks.  That might have clinched to need to hammer paper gold unmercifully to cover shorts across the PM complex because the Fed would have known that the lawsuit was coming well before it was announced publicly.

It is interesting that the Fed announced that they would be doing the job since it is Congress that would have to re-install Glass-Steagall.  It looks like the Fed only wants to restore part of the former law so they can keep some of their control intact.

I believe that just the idea of removing full control and management of the markets is what has set Gold and Silver off at the open and, I suspect, it will do the same for the PM Stocks tomorrow morning.

If the bottom is in for Gold and Silver and the PM Stocks, then we would expect the coming rise to mirror the fall in price, OR to rise faster than the mirror image of the fall in price.  This news votes that “faster” could be the reality.  No doubt that the Fed Banks will have covered their shorts across the PM board and gone long, probably very long all things PM, before the Fed let this information leak out.


We will have to wait to see what happens, but this news is potentially HUGE!  The move up in Gold on the open broke the first major downtrend line on the arithmetic chart going back to early April.

We expect the first real resistance on the upside for Gold to come in around $1800, and it will likely fit the 1979 point structurally.  If so, then we would be looking for the first real parabolic move for Gold and Silver to be in the initial stages with the PM Stocks probably following the path of the parabolic runs for the HUI in 2002 and 2005 as we suggested over the last few weeks.

*For the moment, GOLDRUNNER ~ Email me at [email protected] with your questions and comments; Goldrunner offers a subscription service which provides detailed technical analysis of where the price of gold, silver and precious metal stocks are going in each stage of their respective bull runs. This service comes with detailed charting based on conventional technical analysis and his proprietary fractal analysis based on the ’70s. Go here to subscribe.)
[Editor’s Note: The author’s views and conclusions in the above article are unaltered and no personal comments have been included to maintain the integrity of the original post. Furthermore, the views, conclusions and any recommendations offered in this article are not to be construed as an endorsement of such by the editor.]

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