With volume very low yesterday, it wasn’t hard for any interested party to shove the price of both gold and silver in any direction they wished.

[Note to Readers:  The chances are better than 50/50 that I won’t have a column on Saturday, but I haven’t completely ruled it out at the moment.  Ed]

The high of the day was the brief spike up at precisely 9:00 a.m. in London yesterday morning…and it was all down hill from there, with the low of the day coming about two minutes before 3:00 p.m. Eastern time in electronic trading in New York.

From that low, the gold price recovered a bit into the 5:15 p.m. close.  The final price was $1,656.60 spot, down $2.20 on the day.  Net volume was a very light 95,000 contracts.

Silver didn’t do much during Far East trading on Thursday…and hit its high of the day at 9:00 a.m. in London as well.  The price made a few attempts to make it through the $31 dollar level after that, but finally got turned back for good when it got sold down 40 cents at 8:40 a.m. Eastern time.

After that, the silver price didn’t do a lot…and closed the day at $30.64 spot…up 12 whole cents.  Volume was only 29,000 contracts.

The dollar index continued its relentless decline…and lost about 40 basis points yesterday.  Since the dollar opened on Sunday night in New York, it has lost 150 basis points…a cent and a half.  Any attempts by gold or silver to rally in the face of this almost 2% decline in the dollar have been turned back.

The gold stocks opened in the black, but that didn’t last long…although they managed to hold their own up until about 11:00 a.m. in New York.  Then a relentless sell-off began that continued until precisely 3:00 p.m. Eastern…gold’s low price tick of the day.  The sell-off was out of all proportion to the smallish decline in the gold price that occurred during that four hour time interval.  One has to wonder what the real motive for the sell-off was, as the Dow wasn’t doing much of anything.

From that low, a smallish rally began that took the HUI back above the 500 mark.  It closed down 2.12% on the day.

Nick spent so much time talking to me on the phone [again] this morning that he forgot to update his Silver Sentiment Index. [And this just in from Nick at 6:09 a.m. Eastern: The SSI closed down 0.47% on Thursday.  Nick’s excuse was that he has the flu…which he does…but I know the real reason was the four beers he drank.]

(Click on image to enlarge)

The CME Daily Delivery Report was a surprise, as 11 gold and a rather large 114 silver contracts were posted for delivery on Monday.  As has been the case all month, Jefferies was the only short/issuer in silver…and the Bank of Nova Scotia was the big long/stopper with JPMorgan coming in second by default.  Come to think of it, it was exactly the same for gold…Jefferies, Bank of Nova Scotia and JPMorgan.  I sure don’t know what to make of all this.  The link to the Issuers and Stoppers Report is here.

There were no reported changes in either GLD or SLV yesterday…and no sales report from the U.S Mint, either.

But the big surprise of the day, courtesy of Nick Laird over at sharelynx.com, was the news that Zürcher Kantonalbank in Switzerland added a whopping 8,160,120 troy ounces to their silver ETF last week.  Their silver ETF now holds 89,905,909 ounces.  Between Sprott and ZKB, almost 18 million ounces of silver have been taken off the market within the last week.  That’s more than nine days of world silver production.

The Comex-approved depositories showed that 300,366 ounces of silver were received on Wednesday…and a tiny 2,994 ounces were shipped out the door.  The link to that action is here.

Here’s the Total Precious Metals Pool chart courtesy of Nick Laird…and the big additions by SLV and Sprott are more than obvious.

Reader Scott Pluschau has provided another T.A. commentary on his website…this one regarding gold equities.  It’s headlined “Are the Gold Miners showing a threatening price pattern?”  The link to that is here.

I’ve kept the stories down to the bare minimum…at least for me.

With volume very low yesterday, it wasn’t hard for any interested party to shove the price of both gold and silver in any direction they wished, which is probably what they did.

The CME’s volume page is not loading properly, so it’s obvious that they’re having problems with the website.  Because of that, I don’t have any preliminary open interest data for Thursday…nor do I have the final numbers for Wednesday.

Here’s one more chart from Nick Laird.  I posted this one a couple of days ago, but he made an error in coding the data…and the corrected version below will take your breath away.  Nick and I had our second long-distance chat in as many days about this chart.  It covers a 42-year span…from 1970 until the end of 2011.

As the box in the chart says…”This chart shows what the price of gold would be [blue line] if it never traded between the London a.m. and London p.m. gold fixes.  Both these traces start on the actual London a.m. gold fix at 10:30 GMT on 01/01/970.”

(Click on image to enlarge)

One thing of note on this chart is the discontinuity point that began at the beginning of the fourth quarter of 1999…which was the beginning of the bull market in gold.  I’ll have more to say about this in my Casey Research presentation in Vancouver on Sunday afternoon.

We get two reports today.  The first one out the door will be from The Central Bank of the Russian Federation.  They will update their website with December’s data…and I’ll find out exactly how much gold they purchased for the month…and for the 2011 year as a whole. [This just in after I filed today’s column: The Russian Central Bank has now updated their website as of 5:40 a.m. Eastern time…and they reported buying 300,000 ounces of gold in December, bringing their total reported reserves up to 28.4 million ounces.  For 2011 they added 3.0 million ounces of gold to their reserves.]

(Click on image to enlarge)

The second is the Commitment of Traders Report [for positions held at the close of trading on Tuesday, January 17th] which will be posted on the CFTC website at 3:30 p.m. sharp.

IF…and it’s still a pretty big IF at the moment…I have a column on Saturday, the above mentioned information will be posted in it.

Not much happened to the gold price during the Far East trading day on Friday…and it was basically flat right up until the London open.  Then a willing seller showed up and leaned on the price…and as of 5:18 a.m. Eastern time, the gold price is down an even eight bucks.

Silver hit its high just before the London open…and has been under pressure ever since.  As of 5:20 a.m. Eastern time, the price was down about 35 cents from it’s pre-London open high…and down 20 cents from the Thursday afternoon close in New York.

With the CME website pretty much down across the board, I don’t have any volume figures for you at this time.  The dollar index bottomed around 7:30 a.m. in London…and is now up about 30 basis points off that low as of 5:08 a.m. Eastern.

As much as I hate to keep beating this story to death, there’s still time to either re-adjust your portfolio, or get fully invested in the continuing major up-leg of this bull market in both silver and gold…and I respectfully suggest that you take a trial subscription to either Casey Research’s International Speculator [junior gold and silver exploration companies], or BIG GOLD [large producers], with all our best [and current] recommendations…as well as the archives. A subscription to the International Speculator also includes a free subscription to BIG GOLD as well.  And don’t forget that our 90-day guarantee of satisfaction is in effect for both publications.

That’s all I have for today.  I hope you have a great weekend…and I may, or may not, be here on Saturday.  I have a very busy schedule in Vancouver starting later today…and I’m not sure if I’ll be able to fit it in.

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