AJB Capital

Two weeks ago the Fed stopped buying $40 billion a month of Treasury bills. That program ran from December to keep bank reserves cushioned through tax season. It was built for weeks like the one coming up, and it ended before the week arrived.

Circle Tuesday, September 15.

That's the corporate tax extension deadline. Businesses that filed for an extension in the spring have to pay on the 15th, and so does anyone making a third-quarter estimated payment. That money leaves the banking system and goes into the Treasury's account at the Fed, and bank reserves fall by whatever gets paid.

The same morning, dealers have to fund about $119 billion of new 3-, 10- and 30-year Treasuries. There's a 20-year auction that afternoon. The Fed opens its two-day meeting the same day. Triple witching is that Friday. The Bank of Japan decides the day after the Fed does.

So the banking system has less cash and more paper to finance on the same day.

This happened before, in September 2019. Corporate tax payments

Gold and silver are breaking down, and the miners are where you can see it clearly.

GDXU, the leveraged miner fund, has broken under its key moving averages. That's the tell. When the leveraged vehicle goes first, it isn't the metal being repriced. It's the leverage coming out.

Gold has seen a large speculative buildup over the past few weeks. Negative momentum flushes that out, and it's flushing now. The paper is unwinding, and it can move a lot further and faster than anyone expects, because leveraged positions don't get sold gradually.

None of that breaks the thesis. Central banks are still buying. The debt is still $40 trillion. Every road out of this still runs through more money getting created. The case for owning gold over the next few years hasn't changed at all this week.

What changed is that gold is trading as a momentum position right now instead of a monetary one, and momentum is going the wrong way.

The levels worth writing down are $4,000 on gold and $60 on silver. That's whe