It will be whatever da boyz are instructed to do

The gold price traded flat for a while once the markets opened on Sunday evening in New York, but got sold down in two separate selling bouts, with the low tick coming shortly after the London morning gold fix.  The 1 p.m. BST rally was dealt with in the usual manner an hour and change later in New York—and once the London p.m. fix was in, the gold price traded almost ruler flat for the remainder of the Monday session—and was closed below $1,200 spot.

The low and high ticks were reported by the CME Group as $1,196.10 and $1,209.30 in the June contract.

Gold closed yesterday in New York at $1,198.00 spot, down $9.30 from Friday's closed.  Net volume was pretty light at only 104,000 contracts.

The price action in silver followed virtually the same pattern, except the spike low tick came shorty before 1 p.m. BST—and after that it was the same old, same old.

The low and high were recorded as $16.225 and $16.51 in the May contract.

Silver closed on Monday afternoon in New York at $16.255 spot, down 23 cents from Friday.  Net volume was very much on the lighter side at 22,000 contracts.

Platinum received the same treatment, except there was no recovery at all until after 12 o'clock noon in New York—and then it was only by a few dollars. Platinum was closed at $1,150 spot, down 22 bucks on the day.

After blasting through its 50-day moving average to the upside, palladium met the same fate starting about 10:30 a.m. Zurich time—and “da boyz” on the COMEX finished the job starting shortly before 1 p.m. EDT.  Platinum was closed lower by 7 dollars at $768 spot.

The dollar index closed late on Friday afternoon in New York at 99.35—and proceeded to chop higher in fits and starts until its 99.99 a.m. London high tick, at least according to ino.com.  After that it fell all the way back down to 99.23 before “gentle hands” appeared and closed the index at 99.50—up 15 basis points on the day.

The gold stocks rallied to their high of the day in positive territory at, or minutes before, the London p.m. gold fix.  This was rather peculiar share action, as the gold price was being trashed at the time.  The the shares got sold off to around unchanged shortly after that—and stayed that way until minutes before 2:30 p.m. EDT—and then they gave up the ghost, as the HUI closed down 0.72 percent.

Once again the silver equities never got a sniff of positive territory, although their chart action was a carbon copy of the their golden brethren—and Nick Laird's Intraday Silver Sentiment Index closed down 1.37 percent.

The CME Daily Delivery Report showed that 1 gold and 5 silver contracts were posted for delivery within the COMEX-approved depositories on Wednesday.  The link to yesterday's Issuers and Stoppers Report is here—and there's not much to see, although Jefferies was the short/issuer in both metals.

The CME Preliminary Report for the Monday trading session showed that gold open interest in April declined by another 72 contracts—and now stands at 2,398 contracts remaining.  Silver o.i. remained unchanged at 175 contracts.  The further we get into the delivery month with such smallish delivery action, the more intriguing it becomes.

There were no reported changes in GLD yesterday—and as of 7:13 p.m. EDT yesterday evening, there were no changes reported in SLV, either.  But when I checked back at 1:15 a.m. EDT this morning, I note that another 669,411 troy ounces were added.

The folks over at shortsqueeze.com updated their website on Friday with the changes in the short positions for both GLD and SLV up to and including March 31—and this is what they had to report.

In SLV, the short interest increased from 16.95 million shares/troy ounces, to 19.55 million troy ounces, or 15.32 percent.  In GLD the short interest increased from 1.29 million troy ounces, up to 1.46 million troy ounces, or 12.52 percent.

The U.S. Mint had a small sales report.  They sold 1,500 troy ounces of gold eagles—and 135,500 silver eagles.

There were 40,097 troy ounces of gold reported received at the COMEX-approved depositories on Friday—all of it went into HSBC USA's vault.  Only one kilobar was reported shipped out.  The link to that activity is here.

It was another monster day in silver, as 1,258,474 troy ounces were reported received, of which 1,200,224 troy ounces ended up in JPMorgan's vault.  On the other side—1,387,174 troy ounces were reported shipped out the door—and the link to that action is here.

There was no reported in/out movement at the 'Gold Kilo Stocks' depositories in Hong Kong on Friday.

I have a reasonable number of stories for a Tuesday column—and I hope it remains there for the remainder of Monday evening as I post them.

Included in the continuing flow of evidence that silver is more intensely manipulated in price than gold is the physical movement of metal into and out from the COMEX-approved silver warehouses. No other metal, gold or otherwise, gets moved like physical silver has gotten moved in the COMEX warehouses these past four years. Certainly I have featured it every week since April 2011. Recently, I have openly speculated that the physical silver turnover might be cooling off based upon declining weekly turnover totals. Last week, for example, the turnover dwindled to only 1.2 million oz, the lowest movement I can remember.

Turnover may be cooling overall, but not this week. Actual silver movement in and out from the COMEX warehouses jumped from the lowest to maybe the highest ever, as an incredible 11.1 million oz were moved this week. Just as remarkable as the high turnover total was, it was remarkable that total inventories fell by a minor 1.4 million oz to 175.1 million oz.  This preserves the key observation that over the past year and a quarter, while in/out movement was white hot, COMEX silver inventory totals hardly budged. I concluded that this was a sign of supply tightness. I still feel that way, but the physical COMEX silver movement means something more specific this week. If you are guessing it might have something to do with JPMorgan, you wouldn’t be wrong.

Over the last three days, 3.4 million oz were shipped into the COMEX silver warehouse owned by JPMorgan. Since the silver physically deposited into the JPM warehouse came from other COMEX silver warehouses, the turnover unique to JPMorgan was more than 60% of the total 11.1 million oz turnover (3.4 million oz x 2 for in and out). The deposit into the JPMorgan warehouse further cemented it as the largest COMEX silver warehouse with more than 52 million oz in total reported holdings. Please remember that this was not an operating COMEX warehouse prior to April 2011—and all its deposits have occurred in the past four years. Not coincidentally, this is the same time over which I have claimed that JPMorgan had turned big physical silver buyer.Silver analyst Ted Butler: 11 April 2015

With all four precious metals knocking on the doors of their respective 50-day moving averages at Friday's close, it should have come as no shock to anyone that JPMorgan et al weren't going to allow them to rise any further—and that's what happened.  But they allowed palladium to breach its on Monday morning in Zurich before they acted against that metal.  I'm sure that they wanted to reassure the dumb-as-posts T.A. types that their charts—and therefore their analysis—were still “accurate”.

The proof is in the 6-month charts posted below.

With these “failures” at their respective 50-day moving averages, it's anyone guess as to where we go from here, but down would be my bet.  However, even a move back above the 50-day moving averages is not out of the question—and whatever direction the move may be, it won't have a thing to do with supply and demand.  It will be whatever “da boyz” are instructed to do.

As you can tell from the last story that's posted in today's column, it should be obvious by now to all and sundry, that the WGC is not in the business to help the miners.

What are they doing in secret that they can't tell their members, the public, or the gold community at large?

They were, as Chris Powell so eloquently stated over a decade ago, formed for the sole purpose of ensuring that a real world gold council could never get started—and that the interests of the mining fraternity that are members, were never seriously addressed.  This has come to pass—and exactly the same can be said for The Silver Institute.  Anyone who believes otherwise is delusional.

And as I write this paragraph, the London open is about ten minutes away.  The gold price managed to struggle back to the $1,200 spot price mark in early Tuesday morning trading in Hong Kong.  But then some thoughtful soul showed up at noon local time—and shaved ten bucks off the price over a period of two hours and change.  Silver and platinum prices, which were both up on the day as well, were dealt with in a similar manner—and at the same time.  Palladium got hit two hours later.

Net gold volume is getting up there—and sits at 23,000 contracts.  Virtually all of it is in the current front month, so it's obviously of the HFT variety.  Silver's net volume is around 3,900 contracts—and a tiny chunk of that is roll-over related.  The dollar index has been rallying since it hit its 99.30 low just before 9 a.m. Hong Kong time.  It's up 33 basis points off that low, but up only 12 basis points from Monday's close in New York.

Since today is Tuesday, it's also the cut-off for this week's Commitment of Traders Report.  The numbers in last week's report seemed to be OK—and there were no glaring deficiencies that I could tell.  But I'll be ever watchful, as I've always been, for signs that price/volume data is not being reported in a timely manner.

Here's another paragraph I stole from Ted's weekly review to paying subscribers on Saturdayand it's all about the big deterioration in gold during the reporting week.  I wrote about in my Saturday column, but his comments are much better: “Like I did in last week’s review with silver, it is proper to view the last two reporting weeks in gold on a combined basis. Over the two reporting weeks, the Commercials sold more than 55,000 COMEX gold contracts, the equivalent of 5.5 million oz. No other gold venue featured this quantity of change of ownership. The principal buyers were the technical funds in the Managed Money category, accounting for roughly 45,000 net contracts of gold bought over two weeks. There is no question that these two groups of traders on the COMEX – Commercials and Managed Money – dictate and set prices, as the COT data continuously indicate. The only question is if this is legal since it has nothing to do with any gold market fundamentals—and as such, would seem to be in violation of commodity and interstate laws of commerce.” – Silver analyst Ted Butler:  11 April 2015

Since when did laws of any type matter to JPMorgan et al?

And as I send today's effort off to Stowe, Vermont at 5:25 a.m. EDT, I see that all four precious metals are trading well below their Monday closing prices—and at new low ticks on the day.  Palladium is down 2 percent, although platinum is only down 2 bucks at the moment. Net gold volume is just over the 39,000 contract mark, with 99 percent of it is in the current front month, so it's still all of the HFT variety.  In silver, net volume is up to 6,900 contracts, with 15 percent of the gross volume being roll-overs out of the May contract.  The dollar index has been chopping and flopping—and is currently up 3 basis points.

It's too soon to tell whether this is the beginning of new round of engineered price declines or not, but the current price action hints at that possibility.  I'm sure that the situation will have more clarity by the close of trading today—and if not today, then certainly by the COMEX close on Wednesday.  One of their tricks is to wait until the day after the cut-off for the current COT Report before they really pull the pin on the Managed Money—and it will be interesting to see if that turns out to be the case here.

After going into the hole to the tune of about 20,000 contracts in silver—and 55,000 contracts in gold over the last three weeks, “da boyz” will be looking to get themselves right again, by putting the Managed Money traders fully back on the short side from whence they just came.  That means much lower prices going forward, as JPMorgan et al get back to the salami slicing to the downside once again.

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That's all I have for today—and I'll see you here tomorrow.

Ed Steer

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