Gold declined in quiet slowly through all of Far East and London trading on Monday… with gold’s low of the day [$1,209.80 spot] coming minutes after 9:00 a.m. in New York. From there it rose a few dollars until the London p.m. gold fix was in around 3:10 p.m. in London… 10:10 in New York. Then the gold price took a big pop… and was up a hair over $20 in an hour and change.
From that point it rose quietly… adding on another five bucks or so… closing around $1,241 spot. Gold’s absolute high of the day came between 3-4:00 p.m. Eastern time, at $1,246.20 spot.
Silver’s path was very similar to gold’s except there was a big spike down in early Hong Kong trading which took silver’s price below $17.20 spot… which was its low of the day. Silver recovered all of that spike down loss within the next hour or so… then continue to decline to its New York low at 9:30 a.m. Eastern time. Silver, too, drifted gently higher until the London gold fix was in. From there, it really took off until around 12:15 p.m. Eastern… when the rise became more gradual… with silver closing at $18.24… which was virutally its high of the day.
Silver closed up over a dollar from its absolute Monday lows.
There wasn’t a thing in the dollar’s activity to indicate that the precious metals were in any way affected by what the dollar did. Yesterday’s move in gold and silver were 100% bullion bank-related.
Here’s Monday’s dollar graph for entertainment purposes only.
The HUI reached it’s high of the day during the New York lunch hour… and held there for almost the rest of the trading session… but gave a bit back in the last hour of trading… as the general stock market cotinued to decline. The HUI finished up 2.80%.
Monday’s CME Delivery Report showed that 84 gold and 2 silver contracts were posted for delivery on Wednesday. In my unbridled haste to get my Saturday report out, I forgot to mention what was happening with either the GLD or SLV ETFs. Last Friday, GLD reported that 111,881 ounces of gold were removed… and, for the silver ETF, they reported that 1,469,760 ounces were removed. The U.S. Mint had a report on Monday. It showed that another 2,500 one-ounce gold eagles and another 489,500 silver eagles were sold. Month-to-date… 23,000 one-ounce gold eagles… 12,500 24-k gold buffaloes… and 1,139,500 silver eagles have been sold.
The Zürcher Kantonalbank in Switzerland reported small declines in both their gold and silver ETFs last week. Gold was down 54,139 ounces… and silver was down 32,022 ounces. This is one of the very few weeks over the last 13 months that ZKB has reported a down-week silver. I thank Carl Loeb for those figures.
The Comex-approved depositories showed that 459,359 ounces of silver were taken into their inventories on Friday. There was a lot of in-and-out activity in all of the warehouses… and the above number is the net of all that. The link to Friday’s activity is here.
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Because of the weekend, I have quite a few stories today… so I hope you can find the time to go through them all.
The first story is courtesy of Russian reader Alex Lvov. It’s commentary and an interview that was posted over at cnbc.com. The headline reads ‘Gold’s ‘Real Move’ to $7,000 Coming: Asset Manager‘. The asset manager in question is Egon von Gruyerz, founder of precious metals investment and storage company GoldSwitzerland.com, on Monday. I have a tendency, dear reader, to take whatever he has reasonably seriously. The story and the interview are certainly worth your time and the link is here.
The above story is one of many recently that are making claims for a rather large future gold price. But the fact is [as I’ve stated many times in this column] that no one really knows what the free-market prices of either gold or silver really are. And, if/when the bullion banks ever decide to release their stranglehold on both metals, we’ll find out real quick what those prices are.
As I mentioned in my Saturday column, it appears that Hungary is also facing a Greek-style crisis. Here’s a UPI story from yesterday that’s courtesy of reader Roy Stephens on this very issue. The headline reads ‘Crisis talk: Hungary tries damage control‘… and the link is here.
Here’s another UPI story courtesy of Roy Stephens. This one was filed from Tehran yesterday morning and the headline reads as follows… ‘Iran ready to protect Gaza-bound ships‘. If they carry through on their promise, it could get ugy pretty quick. This is pretty much a must read… and the link is here.
Make it ‘hat trick’ for Roy… as he as another story for us today… this one from the English language edition of the German website spiegel.de. The headline reads ‘German Government Agrees on Historice Austerity Program‘. The German government on Monday announced plans to reduce spending by €80 billion ($95.7 billion) by 2014 in the largest package of cuts since World War II. The link is here.
TheStreet.com‘s Alix Steel interviewed GATA’s secretary/treasurer about the gold price suppression scheme a couple of weeks ago and a transcript of it was posted at that Internet site yesterday under the headline ‘Price Manipulation in Gold and Silver?‘ It’s a bit of read… but certainly well worth it… and the link is here.
Here’s a story that I ‘borrowed’ from Monday’s King Report. The headline is no surprise to me… and should be no surprise to you either, dear reader. It reads ‘Euro will be dead in five years‘. It’s a story from this past weekend’s edition of The Telegraph in London. It’s well worth your time… and the link is here.
Last week I ran a story that Iran was going to sell some Euros and buy American dollars and gold with the proceeds. Iran is now hotly denying that this is the case… with Iran’s Central Bank chief calling it ‘sheer lies.’ Here’s the Reuters story with the headline that reads ‘Iran Central Bank head denies report on selling reserves‘… and the link is here.
Today’s last story is from the Sunday edition of the Financial Times in London. The headline reads ‘Record Inflows for Gold Funds‘. It’s a very positive story… and it’s embedded in this GATA release entitled ‘Most of record gold demand is diverted into ETFs‘… and the link is here.
If you tell a lie big enough and keep repeating it, people will eventually come to believe it. The lie can be maintained only for such time as the State can shield the people from the political and/or military consequences of the lie. It thus becomes vitally important for the state to use all of its powers to repress dissent, for the truth is the mortal enemy of the lie… and thus, by extension, the truth is the greatest enemy of the State. – Joseph Goebbels, Reich Minister of Propaganda in Nazi Germany from 1933-1945
In my telephone conversation with Ted Butler on Monday, he feels that yesterday’s surprise rally out of nowhere in both gold and silver was JPMorgan on a short covering spree. If you check yesterday’s silver action carefully, you will note that they punched below the 200-day moving average in Hong Kong… and then stopped the rally cold just before it made a serious penetration of the 50-day moving average to the upside… which is the point at which the tech funds would begin pouring back into the market. Silver was carefully closed two cents under it’s 50-day moving average.
Here’s the 6-month silver chart…
Ted says that if this is the real up-move in silver, JPMorgan may want to get the silver [and gold] price up in a big hurry. This might give the tech funds second thoughts about jumping in on such a huge price spike… and they may decide to wait for a pull-back… which, of course, will never come.
Ted also said that if this is not the big move in either, or both, metals… then this is what the price action will look like when it finally does happen
Based on that, today’s trading in New York takes on a whole new meaning… and we’ll find out soon enough if any of the above holds water… so hold onto your hats.
Not much happened in gold and silver trading during the Far East session earlier this Tuesday. Both metals were down a bit heading into the London open. But that all changed the moment that London did open… and both metals are now up nicely… especially silver! Volumes in both metals has not been particularly heavy up until that point. But that will all change when the New York bullion banks show up.
The Vancouver gold conference is now history… and I’ll be back at my home base tomorrow. I was flabbergasted at the number of readers of this daily column who approached me and introduced themselves. I was humbled and grateful for everyone’s kind words. Thanks to all.
I hope your Tuesday goes well… and I’ll see you tomorrow.