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Thursday, March 13: Today in Gold and Silver

NEW YORK (TheStreet) -- The gold rally in mid-morning trading in the Far East on their Wednesday ran into a firestorm of not-for-profit sellers, as volume exploded.  But it was "mission accomplished" as the rally got capped shortly before 11 a.m. Hong Kong time.  From that point it didn't do much, but drifted a hair lower until about 11:30 a.m. in London.  The rally that developed at that point was about to go vertical 20 minutes after the Comex open in New York, but another seller of last resort appeared---and that was the end of that.  From there, the price chopped quietly higher until the high tick of the day came at the 1:30 p.m. EDT Comex close.  The gold price got sold down a few dollars from that point before trading flat into the 5:15 close of electronic trading.

The low and high tick were reported as $1,345.60 and $1,371.30 in the April contract.

Gold closed in New York on Wednesday afternoon at $1,367.20 spot, up $17.70 on the day---and just over 1% once again.  Gross volume was over the moon at 270,000 contracts---and even net volume was extremely high at 177,000 contracts.  "Day Boyz" had the big guns out yesterday for sure.

It was more or less the same story in silver, expect it got sold down during the first couple of hours of trading in London, before recovering and heading higher---and any subsequent rally wasn't allowed to get far.  The high tick in silver also came at the Comex close in New York---and got sold down a bit from there.

The CME Group recorded the low and high as $20.82 and $21.435 in the May contract---another trading day where the intraday price move was more than 3%.

Silver finished the Wednesday session at $21.32 spot, up 43.5 cents from Tuesday's close.  Volume, net of March and April, was very high at 57,500 contracts.  JPMorgan et al were active in silver as well.

The mid-morning Far East rallies in gold and silver didn't affect the platinum and palladium prices much, but both metals---like silver---got sold down during the first two hours of London trading on their Wednesday.  Then they both rallied until they topped out in the final hour of trading before the Comex close.  After that, they traded flat.  Here are the charts.

Copper got one last smack to the downside, hitting $2.90 the pound before closing unchanged from Tuesday.  If I had to place a long futures contract on something, it would be copper.  Here's the 6-month chart.

The dollar index closed in New York late on Tuesday afternoon at 79.79---and rallied to its 79.85 "high" by about 8:30 a.m. GMT in London.  From there it headed south, hitting its 79.55 low a few minutes after 1 p.m. EDT in New York.  It recovered a handful of points within the next hour---and then chopped sideways into the close.  The index finished the Wednesday session at 79.61---down 18 basis points from its Tuesday close.

The gold stocks gapped up a percent and change at the open---and then moved higher in fits and starts, finishing almost on their high tick.  The HUI closed up 2.76%.

The silver stocks did OK as well---rallying until 1:30 p.m. EDT when the metal hit its high tick---and from there the silver equities chopped sideways into the close.

The CME Daily Delivery Report showed that there were no gold or silver contracts posted for delivery on Friday.  It's a rare day when there are no deliveries posted in either metal.

There was a withdrawal from GLD yesterday---as an authorized participant took out 48,185 troy ounces.  As of 11:27 p.m. EDT, there were no reported changes in SLV on Wednesday.

The good folks over at Switzerland's Zürcher Kantonalbank updated their website with the latest in/out activity in their gold and silver ETFs---and for the week ending March 7, it was all out.  Their gold ETF showed a withdrawal of 39,879 ounces---and their SLV declined  by 117,607 troy ounces.

There was a tiny sales report from the U.S. Mint, as they sold 500 troy ounces of gold eagles---and 500 one-ounce 24K gold buffaloes.

Over at the Comex-approved depositories on Tuesday, they reported a decent amount of in/out movement in gold as 29,830 troy ounces were reported received---and 60,044 troy ounces were shipped out.  The link to that activity is here.

And, as always, there was much more movement in silver.  398,683 troy ounces were received---and 551,702 ounces were shipped out to parts unknown.  The link to that action is here.

I have another decent number of stories for your reading "pleasure" today---and the final edit is yours.

¤ The Wrap

The really sick thing is that there are so few technical funds and speculating commercials on the Comex doing all the price setting for the miners and everyone else in the world; no more than 30 to 40 active technical funds and commercials on either side. These few Comex traders have captured the price discovery process. The only reason this continues is because it’s easier to accept the universal stories of a China connection than to dig and discover the real reason for sudden price change. I suppose it is possible that the Chinese economy could collapse and keep copper prices under wraps; but that’s separate and distinct from why prices collapsed these past few days.

As I’ve indicated previously, I have no vested interest in trading copper, so please take none of this as trading advice. All I’m attempting to demonstrate is that copper prices have been manipulated on the COMEX every bit as much as silver and gold. The common denominator is the Comex trading mechanism which has supplanted real metal producers, consumers and investors with hair-trigger momentum traders being tricked into buying and selling electronic contracts by crooked and collusive traders led by JPMorgan. - Silver analyst Ted Butler: 12 March 2014

As I mentioned in my remarks in the mineweb story above---"Lawrie Williams over at the mineweb.com Internet site is cautiously optimistic.  I suppose I am, as well, but with JPMorgan et al going short all comers [on over-the-moon volume] since trading began on Monday in the Far East, I'm not overly optimistic about how long these current rallies will last, or be allowed to last.  But I always qualify such a statement with the fact that I would be delighted to be proven wrong---and would wallow in ecstasy as the short holders [mostly the bullion banks] in all four precious metals burn in hell.  For the moment, however, my party favours are still in a box on the top shelf in the hall closet."

That sums it up very well.  And as I've been saying all week, I have no idea what prices are going to do going forward, as they are not set in a free market environment.  They go wherever JPMorgan et al want them to go.  Rob McEwen, along with every other mining executive on Planet Earth knows perfectly well why precious metal prices [and copper] are where they are today, but not one of them will live up to their fiduciary responsibilities to their shareholders and do anything about it.  And the two organizations that should be leading the charge on this, the World Gold Council and The Silver Institute, are there to ensure that nothing is every done about it.

The Far East price action in all four precious metals earlier this morning their time was similar in many respects to the price action on Wednesday at that time.  The results were the same, but the volume was considerably less, but still very high for that time of day.  The London open is still an hour away as I type this paragraph at 3:03 a.m. EDT---and gold volume is already within an eyelash of 30,000 contracts, and silver's volume is over 8,000 contracts---with all this volume being of the HFT variety in the current front months of both metals.

The dollar index was as flat as the proverbial pancake up until 2:30 p.m. Hong Kong time---and then it dropped 15 basis points in less than 30 minutes---and all four precious metals gave back all their early morning gains [and more] shortly after the drop in the index occurred.

And as I hit the send button on today's missive at 3:10 a.m. EDT, I note that all four precious metals are off their previous lows---and above their Wednesday closing prices in New York.  Gold volume is over the moon once again and north of 46,000 contracts---and silver's volume is now over 11,000 contracts.  The dollar index is now down 26 basis points.

Based on this price/volume activity, nothing will surprise me as far as price action is concerned when I get out of bed later this morning.

That's all for today---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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