Is Thailand’s Central Bank Buying Gold?

Is Thailand’s Central Bank buying gold? Gold Dinar Sells Out in Malaysia. Silver soars in early Tuesday trading in London. John Hathaway says that the bull market in gold has barely started… and the truth about gold and silver ETFs.

I wouldn’t read a whole heck of a lot into yesterday’s gold price activity on any market yesterday… even New York. Even though the dollar swooned, it didn’t make one bit of difference to the gold traders on Monday. Both the high and low in Monday’s trading action came during the New York session… with the low [$1,240.10] spot coming at 8:35 a.m. shortly after the Comex open… and the high [$1,429.90 spot] was minutes before 10:30 a.m. Eastern time. I wasn’t entirely surprised to see the U.S. bullion banks turn the gold price back at the $1,250 spot level once again. This has been a line in the sand for the last week or so.

Here’s the New York spot gold chart. It shows Monday’s high spike very clearly. The above chart does not.

Silver was more ‘volatile’ yesterday. Like gold, its price didn’t do much of anything in Far East and London trading. But at 8:45 a.m. in New York.. silver’s price also took off to the upside… only to be stopped dead in its tracks at $20.25 spot… which, like gold, also occurred minutes before 10:30 a.m. Eastern time. An attempt was made to get silver back below the $20 spot price before the end of New York trading… and that attempt failed. Silver has not closed above that number since the middle of March 2008. One has to wonder if the highs from 18 months ago will fall as well. Time will tell.

As I mentioned in my discussion on gold, the world’s reserve currency did a face plant during the Monday trading session. It gapped down at the beginning of Far East trading on Sunday evening New York time… stabilized a bit between 2 and 8:15 a.m. Eastern time… and then declined to its low of the day at 12 noon in New York… and almost closed on its low. The dollar lost around 108 basis points… or 1.3%. Gold should have been up about $15 on the day… but not-for-profit selling made sure that gold closed with a small loss on the day. I wonder who would be selling gold into a falling dollar scenario?

The HUI’s high of the day came around the 10:30 a.m. price spike in gold… and then, along with the gold price, retreated into slightly negative territory… and finished with a small loss of 0.38% on the day.

Well, the CME Delivery Report on Monday showed that nothing of consequence was posted for delivery tomorrow… zero gold and seven silver contracts. Nothing to see here, folks.

The U.S. Mint filed a sales report today. They indicated that they’d sold another 12,500 ounces in their gold eagle program… and another 70,000 silver eagles… and nothing in the one-ounce 24-K gold buffaloes. Month-to-date, there have been 30,500 ounces of gold sold in the gold eagle program, 3,500 one-ounce 24-K gold buffaloes… and 390,000 silver eagles. These are pretty pathetic numbers, dear reader. And, to go along with these low number of silver eagles, comes this story courtesy of the good folks over at numismaster.com. They report that the United States Mint has ended rationing of silver eagle coins… at least until the next shortage… and the link to that story is here. It’s worth the read.

The Comex-approved depositories reported that they added a net 349,747 troy ounces of silver into their warehouses on Friday. The link to that action is here.

Well, if you look at the New York Spot gold chart at the top, you’ll see that gold did try to break out above $1,250… but was turned back. Silver also ran into the same not-for-profit seller. One would suspect, on the face of it, that it was probably JPMorgan.

Trading volume in gold on Monday was on the lighter side… and moderate in silver.

Needless to say, I’ve been watching Tuesday’s price moves in the Far East and early London trading with great interest since 6:00 p.m. Eastern time last night. Both metals were on a bit of a tear… and showed signs of going parabolic starting at 8:00 a.m. London time… but both got capped shortly after London opened for business. And, without doubt, it was the major U.S. bullion banks [who have offices in London as well as New York] who stepped into the market and put an end to the fun.

It will be interesting to see if we break out to new all-time highs today in both silver and gold… or are these early morning price spikes in London the high ticks for the day? Obviously, as I write this at 5:57 a.m. Eastern time, it’s too soon to say.

After watching every twitch in the gold and silver price for the last ten years, I’m still skeptical… and still camped out in Missouri. But, with all these supposed changes in the works, I am very hopeful… but when you’re up against white collar criminals such as these… a healthy dose of skepticism doesn’t hurt. I’d love to be wildly bullish… but nothing is worse, or more embarrassing, than being wrong at the top of your voice… and there’s this little matter of credibility as well. The fact that I’m ‘all in’ should tell you a lot. Besides which, I’m just as happy to let James Turk [and others] stick their necks out.

I’m sure hopeful we’ll break out to much higher prices in both metals… but I’m also wary of the fact that ‘da boyz’ are still out there and have some pretty monstrous short positions in both metals. I’d love to see these bastards get over run with these full short positions on… but, like I’ve said before… if it does happen, it will be for the very first time.

As I put this report to bed for another day, I see that gold is up $8.50 the ounce, with silver up 29 cents. These are big moves for this time of day… especially for silver. I’d love to read something into it, but I won’t. But I am looking forward to New York trading today… and what I will find when I turn my computer on later this morning.

So pour yourself a big mug of coffee and watch to see what kind of show JPMorgan et al put on for us when trading begins in New York.

See you on Wednesday.

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