It was another day where “da boyz” went to work in the thinly-traded Far East market.
The gold price chopped sideways through most of Far East trading on their Thursday, but began to develop a negative bias just before London opened…and by 9:30 a.m. BST, the low tick was in for the day.
The subsequent rally ran out of gas shortly after 11:00 a.m. in New York…and then drifted a hair lower into the 5:15 p.m EDT close of electronic trading.
Gold closed at $1,385.90 spot…down only $6.60 from Wednesday's close. Net volume was a very impressive 197,000 contracts, down only slightly from the 204,000 contracts traded on Wednesday.
It was almost the same price pattern in silver, except the high tick of the day [$22.92 spot] in New York came at 11:00 a.m. EDT right on the button, which just happened to coincide with the close of the London bullion market. From there it traded sideways for the remainder of the day.
Silver closed at $22.69 spot…up a dime from Wednesday. Gross volume was 48,000 contracts, down substantially from the 65,000 contracts traded on Wednesday.
The platinum chart sort of looked similar to the gold chart. But in palladium, the price rallied strongly after its pre-London open low…and the high tick of the day [$746.00 spot] came at the Comex close.
For Thursday, gold closed down 0.47%…silver closed up 0.44%…platinum finished down 0.87%…and palladium closed up 1.66%.
The dollar index closed on Wednesday at 83.785…and then climbed to it's 83.98 high at 9:00 a.m. in London. From there, it was all down hill to its low of the day…83.48….which came a few minutes after 11:00 a.m. EDT in New York. From there it chopped higher into the close, finishing the Thursday session at 83.745…down a whole 4 basis points from Wednesday's close.
For the most part, the precious metal prices tracked the dollar index very closely…but the price moves in the precious metals [both down and up] were out of all proportion to the corresponding moves in the currencies.
The gold stocks started off in the red, but quickly rallied into the black. The high tick came shortly after 11:00 a.m. EDT…which was also the high for gold. The HUI chopped quietly lower from that point, finishing the day virtually unchanged…down 0.09%.
Most of the silver stocks that make up Nick Laird's Intraday Silver Sentiment Index fared only slightly better…and it closed up 0.07%.
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The CME Daily Delivery Report showed that 9 gold and 127 silver contracts were posted for delivery within the Comex-approved depositories on Tuesday. In silver, the two biggest short/issuers were ABN Amro with 70 contracts…and Credit Suisse with 51 contracts. The two biggest stoppers were the ringleaders of the silver price management team…Canada's Bank of Nova Scotia…and JPMorgan Chase, with 90 and 24 contracts respectively. The link to yesterday's Issuers and Stoppers Report is here.
Both GLD and SLV had rather substantial withdrawals again yesterday. In GLD…183,707 troy ounces were withdrawn. In SLV it was a chunky 2,269,165 troy ounces. This looked like plain-vanilla investor liquidation to me…but you just never know any more.
Joshua Gibbons, the Guru of the SLV Silver Bar List, updated his website with the goings-on within SLV for the week ending on May 15th…and this is the first sentence of his very brief commentary…”Analysis of the 15 May bar list, and comparison to the previous week's list…289,605.1 oz. were added (all to Brinks London), no bars were removed or had a serial number change.” The link to his website, about.ag/SLV/, is here.
The U.S. Mint reported selling another 5,500 ounces of gold eagles yesterday…along with 1,500 one-ounce 24K gold buffaloes.
Over at the Comex-approved depositories on Wednesday, they didn't report receiving any silver, but shipped 638,463 troy ounces of the stuff out the door. The link to that activity is here.
In gold on Wednesday, these same warehouses reported receiving 2,424 troy ounces of gold…and shipped out 10,720 troy ounces of same. The link to that activity, such as it was, is here.
Here are a couple of charts courtesy of West Virginia reader Elliot Simon…and neither require any further explanation from me.
And, of course, your “cute quota” of the day…
I have a decent number of stories for you…and I'll happily leave the final edit up to you once more.
The government was set to protect man from criminals — and the Constitution was written to protect man from the government. – Ayn Rand
It was another day where “da boyz” went to work in the thinly-traded Far East market before London opened for the day…so they were able to set the tone first thing in the morning in Europe. But the sell-off didn't last the long…and all the metals recovered most of their losses, or better, as the day went on.
But don't think for one minute that this had anything to do with what was going on in the dollar index, as it was nothing of the sort. It was just JPMorgan et al…and their high-frequency traders trying to force the last technical fund long holder to sell. As Ted Butler pointed out, we're already miles past the blood-out-of-a-stone moment. This is right to the bone…and now that they've reached that stage, prices cannot be forced lower, as that's just the way the pricing mechanism in the futures market works.
As I said in this space yesterday, if we do go lower, it won't be on a lot of real trading volume, as virtually all the price action we're watching right now is of the HFT variety…regardless of the time of day…and it's a very illiquid market.
Here are the 6-month gold and silver charts. As you can see, we've set a double bottom in the silver price, but we've still got a ways to go to get to the same position in gold. I'll be amazed if we get there, but I've learned never to say never.
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And as I said further up, to get lower prices than this, someone has to sell a long position…or be prepared to go further short than they already are. As last week's Commitment of Traders Report showed, we're already in all-time record-breaking territory in some COT categories…both long and short…and I'm just trying to imagine what JPMorgan et al may have left in their bag of dirty tricks, but I'm not of a sociopathic bent, so I can't get into their head space.
While on the subject of the COT Report, we get the new one this afternoon at 3:30 p.m. EDT…and based on the price action for the reporting week that ended at the close of Comex trading on Tuesday, I'm expecting to see small declines in the Commercial net short positions in both silver and gold…but I reserve the right to be wrong… 😉 The only thing I'm sorry about, is that the price action from Wednesday and Thursday won't be in it.
But whatever numbers are, I'll have them for you tomorrow.
There wasn't a lot of price activity in gold and silver during Far East trading on their Friday, but the usual negative price biases developed about an hour or so before the London open …and it remains to be seen what develops as the Friday session progresses from London into New York. Volumes, as of 3:42 a.m. Eastern time, are already very high…and obviously all of the high-frequency trading variety. The dollar index is up 21 basis points at the moment.
And as I hit the 'send' button on today's column at 5:15 a.m. EDT, the smallish sell-offs that came just before the London open haven't amounted to much…at least for the moment. Gold is down ten bucks…and silver is down two bits. Net volume in gold is already north of 40,000 contracts…and the gross volume in silver is a bit over 9,000 contracts. The dollar index is still up 20 basis points or so.
Considering the fact that it's Friday, I'll be ready for any price scenario when I switch my computer on later this a.m.
Enjoy your weekend…or what's left of it, depending where on Planet Earth you live…and I'll see you here tomorrow.
Freegold Ventures Limited is a North American gold exploration company with three gold projects in Alaska. Current projects include Golden Summit, Vinasale and Rob. Both Vinasale and Golden Summit host NI 43-101 Compliant Resource Calculations.
An updated NI 43-101 resource was calculated on Golden Summit in October 2012 and using 0.3 g/t cutoff the current resource is 73,580,000 tonnes grading 0.67 g/t Au for total of 1,576,000 contained ounces in the indicated category, and 223,300,000 tonnes grading 0.62 g/t Au for a total of 4,437,000 contained ounces in the inferred category. In addition to the Golden Summit Project the Vinasale also hosts a NI 43-101 resource calculation which was updated in March 2013. Indicated resources are 3.41 million tonnes averaging 1.48 g/t Au for 162,000 ounces, and Inferred resources are 53.25 million tonnes averaging 1.05 g/t Au for 1,799,000 ounces of gold utilizing a cutoff value of 0.5 grams/tonne (g/t) as a possible open pit cutoff. Please send us an email for more information, [email protected]