This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here
TheStreet Open House

Thursday, December 19: Today in Gold and Silver

NEW YORK ( TheStreet) -- The gold price traded in a very tight range in Far East and Europe trading---and the price activity only started getting interesting in the lead-up to the 2 p.m. EST FOMC report.  The high of the day came shortly before that time---and the price gyrations upon the release of the news didn't go far in either direction.  By 3:25 p.m. the gold price was back to where it started at the close of trading on Tuesday.

Then out of the blue a seller appeared in the thinly-traded New York electronic market, and in less than half an hour had peeled over $16 off the price.  After that, the gold price traded sideways into the close.

The CME recorded the high and low ticks as $1,244.00 and $1,215.20 in the February contract.

Gold close the Wednesday session at $1,218.70 spot, which was down $12.40 from Tuesday's close.  Net volume was reasonably heavy at 165,000 contracts.

It was more or less the same chart pattern in silver, although there was a sharp spike up between 2:30 and 3 p.m. in electronic trading that got dealt with in the usual manner.  After that, the silver price pattern returned to the mirror image of the gold price---and was soon back below $20 spot---and that's where it remained for the rest of the day.

The high and low for the day were recorded by the CME at 19.425 and $20.265 in the March contract---an intraday price move of over 4%.

Silver finished the trading session at $19.73 spot, down 22 cents from Thursday's close.  Net volume was also pretty heavy at 47,500 contracts.

Platinum and palladium didn't do a lot on Wednesday, but did get caught in the 2 p.m. crossfire along with gold and silver, but the effects were more muted.  The downward price pressure was more in sympathy with the other two precious metals, rather than much direct interference.  Here are the charts.

The dollar index closed on Tuesday at 80.04---and then traded flat until around 9:30 a.m. in London.  The smallish rally from that point topped out at 80.19 at 8:30 a.m. EST in New York, before falling back to unchanged by the London p.m. gold fix.  There were some pretty wild gyrations shortly before---and immediately after---the Fed news, and the index had dropped below the 80.00 mark by 2:30 p.m. EST.  But someone was there to catch a falling knife---and the index blasted back above the 80 mark in very short order, and by 4 p.m. was at the 80.49 mark.  From there it traded up a bit into the close, finishing the day at 80.59---which was up 55 basis points from Tuesday's close.

I note that the dollar index chart over at ino.com stopped working shortly after 3 p.m. EST, so the best I could do on short notice, thanks to Nick Laird, was this 5-day chart from the marketwatch.com website.

The gold stocks opened in positive territory and continued to work their way higher as the trading day progressed.  There were a lot of gyrations on the FOMC news, but the stocks were still up about a percent before gold got sold down starting just before 3:30 p.m. EST.  Of course the gold equities followed---and the HUI finished down 1.48%.

The silver equities turned in a similar chart pattern and performance, as Nick Laird's Intraday Silver Sentiment Index closed down 1.26%.

The CME's Daily Delivery Report showed that 31 gold and 38 silver contracts were posted for delivery within the Comex-approved depositories on Friday.  30 of the gold contracts were stopped by JPMorgan in its in-house [proprietary] trading account.  In silver they stopped 21 contracts.  The link to yesterday's Issuers and Stoppers Report is here.

As usual, there was another withdrawal from GLD yesterday, this time an authorized participant took out 135,035 troy ounces.  And as of 7:51 p.m. EST yesterday evening, there were no reported changes in SLV.

The good folks over at Switzerland's Zürcher Kantonalbank updated their gold and silver ETFs as of the close of business on Friday, December 13.  Their gold ETF showed a decline of 44,998 troy ounces---and their silver ETF showed a decline of 119,923 troy ounces.

And, for the third day in a row, there were no reported sales from the U.S. Mint.  One has to wonder if they are finished selling 2013 bullion products for the rest of December, as this lack of sales is unprecedented for this time of year.  We'll see.

There was very little in/out movement in either gold or silver at the Comex-approved depositories on Tuesday.  In gold, there were 1,428 troy ounces reported shipped out---and in silver there 989 troy ounces shipped out.  Nothing was reported received in either metal.

I don't have that many stories today, so I hope you have the time to read the ones that are of interest.

¤ The Wrap

It’s really quite simple – a manipulated market is defined by a concentrated position; a free market has no such concentration of holdings. Let me make it more specific. For the past six years, one entity (JPMorgan) has often been the sole new short seller on every silver price rally of significance. This is how and why the silver manipulation has persisted. This is how and why the manipulation will end, namely, JPMorgan not adding to Comex silver short positions. I suppose it is possible that this crooked bank may find a way to disguise future additional Comex silver short sales, but barring that it comes down to whether JPMorgan shorts more silver or not as to whether the manipulation is terminated. - Silver analyst Ted Butler: 18 December 2013

Well, if there ever was a more perfect time when markets had to be managed to perfection, the FOMC news at 2 p.m. EST yesterday was one of them.  As GATA's Chris Powell so eloquently put it more than five years ago---" The are no market anymore, only interventions."  And as Bill King said in this morning's edition of the King Report---" SPHs tanked on the announcement but someone immediately rescued the S&P futures with aggressive purchases. This phenomenon of rescuing stocks via SPH manipulation has become a market staple."

If any further proof was needed, here's what the DOW chart looked like yesterday.  It began to head south the moment the news broke, but strong hands were there to catch a falling knife.

The U.S. dollar index looked very similar to that before a not-for-profit buyer showed up there as well.

And, with that in mind, exactly the opposite happened in the precious metals, but they needed some help on their south-bound journey---and they got it, although some of that help arrived embarrassingly late.

In Far East trading on their Thursday, the rally attempts in both gold and silver were handled in the same old way, with the engineered price decline in silver being the most egregious.  Gold volume wasn't overly heavy during the Hong Kong/Tokyo trading session but, not surprisingly, silver's volume was much heavier.  And, with the London open about 20 minutes away, the dollar index---which had topped out at 80.65 at precisely 11 a.m. Hong Kong time---is now down 10 basis points from its New York close on Wednesday.

Five minutes after I wrote the above paragraph, the HFT boyz showed up---and took gold down once more.  Then shortly after the London open, both gold and silver---along with platinum---got hit once again.  Gold hit a new low of $1,198 in the March contract, a low that goes all the back to the July low.  Silver isn't back to its early December low yet, but it got close at $19.13 in the March contract.  Palladium is showing unchanged on the day at the moment.  Gross volume in gold is north of 60,000 contracts---and over 16,000 contracts in silver.  The dollar index is still down a bit as I sent this e-mail off to Stowe in Vermont at 5:15 a.m. EST.

Here are the latest charts just as I hit the send button.

How the rest of the Thursday trading session unfolds could prove interesting---and not just in the precious metal market, either..  The across-the-board market interventions are now so obvious, that only the willfully blind can't/won't acknowledge it; or as the famous Upton Sinclair quote goes---" It's difficult to get a man to understand something, when his salary depends upon his not understanding it."

See you on Friday---but if you live west of the International Date Line, the weekend is upon you already, so have a good one.

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.

Select the service that is right for you!

COMPARE ALL SERVICES
Action Alerts PLUS
Try it NOW

Jim Cramer and Stephanie Link actively manage a real portfolio and reveal their money management tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
  • Weekly roundups
TheStreet Quant Ratings
Try it NOW
Only $49.95/yr

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
  • Upgrade/downgrade alerts
Stocks Under $10
Try it NOW

David Peltier, uncovers low dollar stocks with extraordinary upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
  • Weekly roundups
Dividend Stock Advisor
Try it NOW

Jim Cramer's protege, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Alerts when market news affect the portfolio
  • Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
Real Money Pro
Try it NOW

All of Real Money, plus 15 more of Wall Street's sharpest minds delivering actionable trading ideas, a comprehensive look at the market, and fundamental and technical analysis.

Product Features:
  • Real Money + Doug Kass Plus 15 more Wall Street Pros
  • Intraday commentary & news
  • Ultra-actionable trading ideas
Options Profits
Try it NOW

Our options trading pros provide daily market commentary and over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

Product Features:
  • 100+ monthly options trading ideas
  • Actionable options commentary & news
  • Real-time trading community
  • Options TV
To begin commenting right away, you can log in below using your Disqus, Facebook, Twitter, OpenID or Yahoo login credentials. Alternatively, you can post a comment as a "guest" just by entering an email address. Your use of the commenting tool is subject to multiple terms of service/use and privacy policies - see here for more details.
Submit an article to us!

Brokerage Partners

Rates from Bankrate.com

  • Mortgage
  • Credit Cards
  • Auto

Free Newsletters from TheStreet

My Subscriptions:

After the Bell

Before the Bell

Booyah! Newsletter

Midday Bell

TheStreet Top 10 Stories

Winners & Losers

Register for Newsletters
Top Rated Stocks Top Rated Funds Top Rated ETFs