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Wednesday, September 4: Today In Gold And Silver

NEW YORK (TheStreet) -- The short sell off during the first hour of London trading proved to be the low of the Tuesday session, and by 10 a.m. BST the gold price the price jumped back to unchanged from Monday's close.

From that point gold traded sideways until about ten minutes after the 8:20 a.m. EDT Comex open, and the subsequent rally ran out of gas/got capped shortly before 2 p.m. in electronic trading.  The high tick at that point was recorded by Kitco as $1,417.70 spot.  After that, the gold price gave back about five bucks of its gain going into the 5:15 p.m. New York close.

Gold finished the Tuesday session at $1,412.20 spot, up $15.70 from last Friday's close.  Net volume for both Monday and Tuesday combined was reported as 215,000 contracts, which was not overly heavy.

The silver price chopped around in a broad 25 cent range either side of unchanged right up until ten minutes after the Comex open, and the subsequent rally topped out about 9:50 a.m. EDT.  The high tick was $24.60 spot. From there it traded more or less sideways until 1 p.m., and then the silver price sold down a bit into the close.

Silver closed on Tuesday at $24.28 spot, up 75 cents from the prior Friday's close.   Volume, net of September and October, over the Monday and Tuesday trading session was reported as 67,000 contracts.

Platinum had a nice rally during the New York trading session, and palladium's minor gains in Europe got taken away by lunch time in New York.  Here are the charts.

The dollar index closed on Monday at 82.24 and spent all of Tuesday moving unsteadily higher.  At its 11:30 a.m. EDT zenith, the index painted 82.48.  After that it got sold down a bit going into the close, and it finished the Tuesday trading session at 82.38, up 14 basis points on the day.

The gold stocks gapped up about 2 percent at the open, but couldn't hold those gains despite the fact that gold was in rally mode right up until around 2 p.m. in New York.  The HUI closed up only 0.78%.

Despite the stellar gains in silver on Monday and Tuesday, Nick Laird's Intraday Silver Sentiment Index closed up only 1.43%.  I was underwhelmed.

(Click on image to enlarge)

The CME's Daily Delivery Report for Tuesday showed that 21 gold and 15 silver contracts were posted for delivery tomorrow.  JPMorgan was the short/issuer on all 21 gold contracts and 3 of the silver contracts.  I thank reader Jon De Weese for providing this data from his website.

There were withdrawals reported in both GLD and SLV yesterday.  Ted Butler and I were both surprised by this, especially Ted, and I know he'll have more to say about it in his mid-week column later today.  GLD reported a withdrawal of 57,943 troy ounces, and in SLV it was an eye-watering 2,024,820 troy ounces.

Yes, there were price declines in both metals late last week, but the withdrawals seem excessive, especially the 2 million ounces out of SLV.

As expected, the U.S. Mint had a sales report yesterday.  They sold 1,500 ounces of gold eagles; 500 one-ounce 24K gold buffaloes, and 675,000 silver eagles.  And as I mentioned in Saturday's column, it's a near certainty that these sales occurred in August, and were just reported yesterday.

Over at the Comex-approved depositories on Friday, they reported receiving 31,813 troy ounces of gold, and shipped 21,211 troy ounces of the stuff out the door.  The link to that activity is here.

In silver on Friday, there were 591,540 troy ounces received, and 13,265 ounces shipped out for parts unknown.  The link to that action is here.

I have a decent number of stories for you today, so I hope you find some that interest you.

¤ The Wrap

Every gun that is made, every warship launched, every rocket fired signifies in the final sense, a theft from those who hunger and are not fed, those who are cold and are not clothed. This world in arms is not spending money alone. It is spending the sweat of its laborers, the genius of its scientists, the hopes of its children. This is not a way of life at all in any true sense. Under the clouds of war, it is humanity hanging on a cross of iron. -- General Dwight Eisenhower

Although I was happy to see gold, and particularly silver, do well over the last couple of days, the precious metal equities continue to stink up the place.  They started the day off well again yesterday, but "faded" into the close despite the fact that the underlying metal prices did well, which is a price pattern that we've seen a lot of lately, and I'm sort of wondering out loud if this is the free market in action, or possibly something else.  Whatever it is, the shares aren't confirming the rise in the gold and silver price over the last two or three weeks.

I took a quick peek at the preliminary changes in open interest in gold and silver over the last two trading days; up almost 12,000 contracts in gold and a bit over 3,000 contracts in silver.  I'm not overly encouraged by that, but the final numbers should show an improvement.  However, we really won't know for sure until this Friday's Commitment of Traders Report is posted on the CFTC's website, and all of this data will most certainly be in it, as the Comex close yesterday was the cut-off for that report.

The price of gold didn't do much of anything in Far East trading on their Wednesday, and it's more of the same now that London has been open for about 35 minutes as I write this paragraph.  However, silver got taken down pretty good, from $24.35 spot shortly after 8 a.m. Hong Kong time, all the way down to $23.70 by 2 p.m. in their afternoon, a decline of almost 3 percent.  It made it back to the $24 price mark by the London open.  Gold volume is not overly heavy for this time of day, but it nearly goes without saying that silver's volume is already very chunky; north of 12,000 contracts.  Platinum and palladium are trading sideways, and the dollar index is flat.

And as I hit the send button on today's column at 5:15 a.m. EDT, both gold and silver are trading lower than they were at the London open.  Gold is now down about 9 bucks, and silver is down 48 cents.  Gold volume is getting up there at 30,000 contracts net, but silver's volume is only marginally higher than reported in the prior paragraph.  The dollar index is still comatose.

I haven't the foggiest idea what will happen during the New York trading session today, but I'll be surprised if it passes without incident.

That's all I have for today, which is more than enough, and I'll see you here tomorrow.

This is an abbreviated version of Ed Steer's Gold & Silver Daily Sign-up to have to the complete market review delivered to your email inbox each morning for free.

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