Saturday, August 31: Today In Gold And Silver
NEW YORK ( TheStreet) -- For the third day in a row the high tick of the day [such as it was] came in Far East trading, and for the third day in a row the gold price got sold down after that. On Friday the sell-off came right at the London open, and the smallish rally in New York trading back over the $1,400 price mark wasn't allowed to last.
Gold closed in New York on Friday at $1,396.50 spot, down another $10.70. Net volume was still pretty decent at 126,000 contracts, with over 25 percent of that amount occurring by 9 a.m. in London.
Every attempt by silver to break above the $24 spot mark in Far East trading on Friday met with not-for-profit selling. Then the silver price got sold down until shortly after London opened before making another rally attempt to the $24 spot mark, and that got smacked shortly after Comex trading began, and that was pretty much it for the day. Silver's New York high and lows ticks were $24.02 and $23.31 respectively, a intraday move of almost 3 percent. Both high and low came within ninety minutes of each other. Nothing free market about that. Silver finished the Friday trading session at $23.53 spot, down 34 cents from Thursday's close. Net volume was very decent at 44,000 contracts. Here's the New York Spot Silver [Bid] chart on its own, so you can see the not-for-profit seller's footprints that came less than ten minutes after the Comex open as silver blasted for the $24 spot mark. Platinum and palladium went their separate ways yesterday, and here are the charts. The dollar index closed late Thursday afternoon in New York at 82.005, and did very little during the Friday trading session. The rally up to 82.24 by 11 a.m. in New York [the close of London trading] faded into the 5:15 p.m. electronic close. The index finished the day at 82.07, up a handful of basis points. Nothing to see here. The gold stocks started off about 2 percent in the red at the open in New York on Friday morning, but managed to make it into positive territory just before noon EDT, and then slid into the close. The HUI finished down 1.50%. The silver stocks didn't do well at all, as Nick Laird's Intraday Silver Sentiment Index closed down 2.52%.
(Click on image to enlarge)For the week that was, the gold stocks finished down about 9 percent, and the silver stocks were down about 10 percent The CME's Daily Delivery Report for "Day 2" of the September delivery month showed that 20 gold and 642 silver contracts were posted for delivery on Wednesday of next week. The 20 gold contracts were issued by JPMorgan Chase, and the stopper was Canada's Bank of Nova Scotia. There were about two dozen firms issuing and stopping silver contracts yesterday. The three biggest short/issuers were JPMorgan out of its client account with 233 contracts, ABN Amro with 134 contracts, and Macquarie Futures with 97 contracts. The three largest long/stoppers were Canada's Bank of Nova Scotia with 358 contracts, JPMorgan Chase in its client account once again with 132 contracts, and Credit Suisse with 99 contracts in its proprietary trading account. [I'm wondering out loud if these client account numbers reported for JPMorgan are right. I'll be on the lookout for a correction. - Ed] The current Issuers and Stoppers Report is worth looking at once again, and the link is here. There were no reported changes in either GLD or SLV yesterday, and Ted Butler is still of the opinion, rightly, that SLV is owed around 10 million ounces. Joshua Gibbons, the "Guru of the SLV Bar List" had this to say about the changes in SLV for the end of trading on Monday, August 26: " Analysis of the 26 August bar list, and comparison to the previous week's list: 964,135.0 troy ounces was added (all to Brinks London), no bars were removed or had a serial number change." " The bars added were from: Korea Zinc (0.6M oz.), Met-Mex Penoles (0.2M oz.), Prioksky (0.1M oz.), and 3 others." The link to Joshua's website is here. There was a smallish sales report from the U.S. Mint yesterday. They sold 500 ounces of gold eagles and 500 one-ounce 24K gold buffaloes, but no silver eagles sales were reported sold. Based on mint sales so far this month, 11,500 ounces of gold eagles; 10,000 one-ounce 24K gold buffaloes and 3,625,000 silver eagles, the silver/gold ratio is still a ridiculous 168 to 1. But there's no doubt that the mint sold more silver eagles during the week just past, but they always report silver eagles sales on the first day of the week, so it's a very safe bet that whatever silver eagles are reported sold by the U.S. Mint on Tuesday, will actually have been sold in August. I'll update this data in my Wednesday column. Over at the Comex-approved depositories on Thursday, they reported receiving 11,633 troy ounces of gold, and didn't ship anything out. The link to that activity is here. In silver, nothing was reported received on Thursday, but 361,191 troy ounces were shipped off to parts unknown. The link to that action is here. The Commitment of Traders Report showed deterioration in both silver and gold. In silver, the Commercial net short position increased by only 1,100 contracts, or 5.5 million ounces, and it now sits at 121.9 million ounces. Ted said that JPMorgan only increased their short position by about 500 contracts, and the '5 through 8' traders added to their short positions as well. It could have been worse. In gold, the Commercial net short position blew out by 20,000 contracts, or 2.0 million ounces, and the Commercial net short position is now back up to 8.05 million ounces. JPMorgan sold another 5,000 contracts of their long position, which Ted Butler says is down to about 6 million ounces. The smaller Commercial traders other than the Big 8 sold the balance [15,000 contracts] at a profit. The Non-Commercial traders covered a bit over 19,000 contracts of their big short position, and the small traders went long 2,000 contracts net. The COT Report is still very bullish, but not as wildly bullish as it was three weeks ago, as JPMorgan has obviously been selling into these rallies and that, in part, has capped the price, because if they had just sat on their hands and done nothing, the prices of both metals would be far higher than they are today. But no matter how you slice it or dice it, JPMorgan Chase still has a long-side corner in the gold market to go along with their short-side corner in the silver market. Their long corner in the gold market is slowly shrinking, while their short corner in the silver market is on the rise again. I'll be very interested in what Ted has to say about all this in his weekend commentary to his paying subscribers later today. I don't have all that many stories for a Saturday, so I hope you can find time in what's left of your weekend to read the ones that you feel are important to you.
¤ The WrapCautious, careful people, always casting about to preserve their reputation and social standing, can never bring about a reform. Those who are really in earnest must be willing to be anything or nothing in the world's estimation, and publicly and privately, in season and out, avow their sympathy with despised and persecuted ideas and their advocates, and bear the consequences. - Susan B. Anthony Today's pop 'blast from the past' was a big hit in 1959 when I was 11 years old, and anyone of that vintage will know the artist and song straight away. The link is here. While I'm at it, here's another of his big hits from the same year. Neil Sedaka is at the keyboard in this recording linked here. I know both tunes all too well, I'm afraid. Today's classical 'blast from the past' is another recording I heard on CBC Radio 2 when I was driving to work at the bullion store earlier this week. It's Frédéric Chopin's Piano Concerto No. 2 in F Minor, Op. 21 which he composed back in 1830 when he was just twenty years old. This particular performance is by Russian pianist Evgeny Kissin along with the Warsaw Philharmonic Orchestra. Antoni Wit conducts, and the link to the youtube.com video is here. It always brings the house down whenever and wherever it is performed, and this performance is as good as it gets. Except for the obvious take down in the gold price at the London open, I wouldn't read too much into yesterday's price action, as everyone in New York was heading out the door early for the last long weekend of the summer. Although I'm hardly thrilled with the gold and silver price action [or the price action of the shares] during the prior week, one has to look at it through the eyes of those managing the price. Despite the negative news, the price action has never been allowed to get out of hand, as the moment the precious metals get too rambunctious, they're always there to put a quick end to it all. I'm hoping/expecting that things will improve now that summer in the northern hemisphere is firmly in the rear-view mirror, but there's no way of knowing for sure. However, with all the precious metal friendly news out there, the only thing that stands in the way of sharply higher prices is a company called JPMorgan Chase. With their short-side corner in the Comex futures market to go along with their long-side corner in the gold market, they're still in the driver's seat. How high, or low, we go from here is still entirely up to them. The U.S. has really boxed themselves in with this ongoing situation in Syria. No matter what course of action they take going forward, the blow-back from both friend and foe will probably be considerable. And as British MP George Galloway so eloquently put it in that video in the Critical Reads section above, if the British government had passed the motion to act against Syria, the Tomahawk missiles would be raining down on Syria as I write this, and they still may before the weekend is over. The U.S. and Britain have an agenda, but democracy got in the way on Thursday in the U.K. parliament. I'm sure that the dogs of war in the New World Order crowd are hatching "Plan B" at the moment, but the world is paying full attention now, and they won't buy it for a second. Neither should you, dear reader. What a mess. Before heading out the door, I'd like to remind you about the Casey Research 2013 Summit which is happening October 4 - October 6. Some of the speakers include Dr. Ron Paul, Doug Casey, Donald Coxe, James Rickards, John Hathaway, John Mauldin, and Chris Martenson, so you can see that it's an ALL STAR LINEUP. And as David Galland stated in a shout-out yesterday: At most conferences, the speakers fly in just long enough to make their presentations, then jet off to their next engagement. That will most definitely NOT be the case at the Casey Summit. In fact, almost all of the faculty, including long-term friend and keynote speaker Dr. Ron Paul, have enthusiastically agreed to participate side by side with the audience from the beginning to the end of the event. So the chances are excellent that all your questions will get answered, and you may have the opportunity for some one-on-one with some of the speakers during the conference. You save $100 if you register before August 31st, and you can find out all about it by clicking here. I'll be very interested in seeing how gold and silver perform, or are allowed to perform, at the 6:00 p.m. open in New York on Sunday evening. I'm off to bed. Enjoy what's left of your long weekend, if you get one. I'm one of the lucky ones, and my next column won't be in your in-box until Wednesday morning. See you then.
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