Yesterday’s price action was a classic bear raid by JPMorgan et al…and what a job they did.

The gold price managed to make it above the $1,600 spot price mark during Tuesday morning in the Far East.  That came to an end at noon Hong Kong time yesterday, as the gold price began to edge slowly lower from there.

This gentle decline continued all through early London trading, but at 1:00 p.m. BST…7:00 a.m. Eastern…the high-frequency traders went to work…and the gold price fell off a cliff.  The low tick of the day came about fifteen minutes before the Comex close…and Kitco recorded that price as $1,573.00 spot. From that low, gold recovered a few dollars before trading sideways into the 5:15 p.m. electronic close.

Gold finished the Tuesday trading session at $1,576.20 spot…down $23.20 spot.  Net volume was pretty heavy…around 175,000 contracts.

It was virtually the same price path for silver as it was for gold…and it was silver that “da boyz” were really after.  The low tick [$27.12 spot] came at 1:10 p.m. Eastern time…and the subsequent tiny rally got quietly sold off into the electronic close.

Silver closed at $27.26 spot…down 76 cents from Monday…but over a dollar intraday.  Net volume was around 45,000 contracts.

Platinum and palladium weren't spared by JPMorgan et al, either…as they closed down 1.26% and 1.92% respectively.  Gold finished down 1.45%…and silver was the star…down 2.71%…but well over three percent intraday.

The dollar index opened in the Far East on Tuesday at 82.73…and began to head south almost immediately.  The low tick [82.50] came just minutes before 1:00 p.m. Hong Kong time…then away went the index to the upside…closing just off its high of the day at 82.88.

For a change, the index price action was a mirror image of what went on in the gold and silver markets…except for platinum and palladium.  However, the price smashes in all four precious metals were out of all proportions to the smallish moves in the dollar index.  You pretty much have to be willfully blind not to see yesterdays price action in the precious metals market for what it really was…a premeditated and co-ordinated bear raid by JPMorgan Chase et al…hidden behind the fig leaf of a rally in the dollar index.  Here's the 2-day chart, so you can see the Tuesday currency move in its entirety.

The gold stocks gapped down…and then kept on going.  The HUI closed on its absolute low of the day…down 4.18%.

The silver stocks got creamed across the board, as Nick Laird's Intraday Silver Sentiment Index got crushed to the tune of 4.07%.  A lot of the junior producers fared far worse than that.

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The CME's Daily Delivery Report showed that 1,153 gold and 1 lonely silver contract were posted for delivery on Thursday.  The only short/issuer was JPMorgan Chase, with 628 out of its client account, plus another 525 out of its in-house [proprietary] trading desk.  The three largest long/stoppers were HSBC USA, Canada's Bank of Nova Scotia…and Barclays…with 492, 438 and 210 contracts respectively.  The link to yesterday's Issuers and Stoppers Report is here…and it's worth a quick peek.

There was another withdrawal from GLD yesterday.  This time it was a rather large 261,193 troy ounces.  There were no reported changes in SLV.

The U.S. Mint had a small sales report yesterday.  They sold 6,000 ounces of gold eagles…and 500 one-ounce 24K gold buffaloes.

Well, the Comex-approved depositories weren't closed on Monday, either…as they reported receiving 977,095 troy ounces of silver…and shipped 57,400 troy ounces of the stuff out the door.  The link to that activity is here.

When the doors opened at the bullion store here in Edmonton yesterday morning, it was wall-to-wall buyers all day long with barely a break.  We could barely keep up.  It was evenly split as to whether they buying because of JPMorgan et al's new sale prices…or it was about being “Cyprused” here in Canada.  There were a lot of first-time buyers as well.  If it's slower tomorrow, I might actually find the time to buy some myself.

After some heavy-handed editing, I have the stories down to a 'manageable' number, at least compared to yesterday's column.

I am still of the mind that we are close to a silver price bottom of some great significance and that the investment risk/reward ratio in silver has rarely been more attractive than it is currently….The essence of successful investment is to place funds into the thing least likely to lose money and most likely to show great gains. In this instance, silver is it.Silver analyst Ted Butler…30 March 2013

As I mentioned further up in this column, yesterday's price action was a classic bear raid by JPMorgan et al…and what a job they did.  Of course it goes without saying that the CFTC, CME Group…and the precious metal mining companies will say and do nothing.

The only good thing about yesterday's price action is that it will all be up for public display in Friday's Commitment of Traders Report…and the accompanying Bank Participation Report…both of which are derived from the same data set…and both should be a sight to see.  On this one day per month we get to see the footprints of the bullion banks in the precious metal markets.  And they are oh-so-easy to spot, because there are only three of them that matter…with JPMorgan as their leader.  I will have extensive commentary [and charts] on this in Saturday's column.

There is a limit to down-side price action, because the law of diminishing returns begins to set it for the bullions involved as prices decline to new lows.  But have we reached that price yet, or are we close?  Who knows for sure.  How many more technical fund longs can “da boyz” trick into selling by these engineered price declines that Ted spoke of in the last 'Critical Read' of the day?  Once they have all they figure they can get…by covering as many of their short positions as they can…and/or gone long themselves, the price bottom will be in.

As I mentioned further up, it was wall-to-wall buyers in the bullion store yesterday…and no customer sold us a single ounce of anything.  This is a buying opportunity not to be missed if you have any money left to invest of course.

Here are the 3-year charts for all four precious metals so you can see the current handiwork of JPMorgan et al compared to what they've been up to both before and after their drive-by shooting event in silver on May 1, 2011.

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You should carefully note that “da boyz” aren't having much luck with palladium at the moment, as the supply/demand equation is in a deficit situation…with platinum and silver not far behind.  Only the continual rigging of the paper markets on the Comex, where the official price is 'set' every day, prevents the true free-market price from being revealed in all four precious metals.

Is this JPMorgan's last swing for the fences in silver?  I don't have the answer, but it certainly feels that way.  Unfortunately we won't know for sure until it appears in the rear-view mirror of monstrously higher prices…and these bargain-basement prices before you today will become the stuff of legend.

In the thinly-traded Far East market earlier today, the high-frequency traders went to work on gold and silver shortly before 9:00 a.m. Hong Kong time, dropping their respective prices to new lows for this move down…and were still working silver over pretty good right up until the 8:00 a.m. BST London open.  And as I hit the 'send' button at 5:10 a.m. Eastern Daylight Time, both gold and silver have rallied a bit off their opening lows in London.  Not surprisingly, the associated volumes are pretty chunky at the moment…a bit over 42,000 contracts in gold…and a hair over 13,000 in silver.  The dollar index was up about 10 basis points, but as you should have figured out by now, what's going on with the currencies has become irrelevant to the price of silver and gold when JPMorgan et al are running the precious metal prices into the ground like they've been doing since the beginning of the year.

I haven't the foggiest idea of what the price action will be like in the precious metals for the rest of the day, although I expect that once the noon silver fix is in London, it could get interesting going forward.  But whatever the outcome, I'll have it for you here tomorrow…and I'll see you then.

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