Friday, March 21: Today in Gold and Silver
NEW YORK ( TheStreet) -- The gold price didn't do much of anything during Far East trading---and chopped around the $1,330 spot mark until shortly after 9 a.m. GMT in London. Then, during the next three hours, it got sold down a bit more than ten bucks, hitting its low of the day a few minutes after 11 a.m. GMT---and about 15 minutes before the Comex open.
From that low, the gold price rallied back to unchanged on the day by noon in New York---and then traded flat for three hours, before getting sold down a few dollars to close at a loss on the day.
The CME recorded the low and high ticks as $1,320.80 and $1,335.30 in the April contract.Gold finished the Thursday trading session at $1,328.50 spot, down $2.10 from Wednesday's close. I must admit that I was expecting much worse than that. Volume, net of roll-overs out of the April delivery month was around 135,000 contracts, with about a third of that coming before 9:15 a.m. in London. The engineered sell off in silver started much earlier than the sell-off in gold---about 15 minutes before the London open. And, like gold, the low tick came a few minutes after 8 a.m. in New York. After that, the price path was a virtual carbon copy of gold's. The high and low ticks in silver were recorded as $20.73 and $20.14 in the May contract---and another intraday move of almost 3%. Silver closed in New York late yesterday afternoon at $20.27 spot, down 34 cents from Thursday. Volume, net of March and April, was pretty high at 49,000 contracts, with a quarter of that coming before 9:15 a.m. GMT in London. The silver price is now well below both its 50 and 200-day moving averages. Platinum rallied a bit in Far East trading, hitting its high of the day at 10 a.m. Hong Kong time. From there it was a long, slow slide into the close of New York trading, with the spike low of the day coming at 11 a.m. EDT. Palladium followed the same path as platinum until shortly after 8:30 a.m. EDT, then away it went to the upside, gaining more than twenty bucks off its low tick by shortly after 11 a.m. EDT. At that point, either the price was capped, or the buyer disappeared [you pick]---and the metal chopped sideways for the remainder of the New York Trading session. There's a big story about palladium in the Critical Read section further down that falls into the must read category. The dollar index closed in New York Wednesday afternoon at 80.02---and then drifted quietly lower until about 15 minutes before the London open on their Thursday morning---and about the same time that "da boyz" began to trash the silver price. The index topped out at 80.31 about 11:20 a.m. GMT---and then drifted lower for the remainder of the Thursday trading session, closing at 80.19, which was up 17 basis points from Thursday's close. Here's the 3-day dollar index chart to put yesterday's move in some perspective. The gold stocks gapped down a percent at the open, but began to rally immediately---and were back in positive territory in very short order. The index topped out shortly before noon in New York---and then chopped sideways until just before 3 p.m. Then they gave back about a percent of their gains as the gold price weakened as the afternoon wore on. The HUI finished up only 0.59%---but we'll take it! The silver equities also opened in the red, but by less than a percent---and hit their high at noon in New York. Then they sold off a bit before rallying again until 3 p.m. EDT---and then they, along with gold shares, faded into the close as both metals got sold off. Nick Laird's Intraday Silver Sentiment Index closed up 0.16%. Considering that the silver price closed down 34 cents on the day, this is the second major divergence this week between the silver shares and the performance of the underlying metal. As I said in yesterday's missive, it's a phenomenon that I would be watching closely---as it appeared that somebody may know something that we don't. I'm convinced of that fact now. The CME's Daily Delivery Report showed that 12 gold and 25 silver contracts were posted for delivery within the Comex-approved depositories on Monday. JPMorgan Chase, in it's in-house [proprietary] trading account, stopped 11 of the gold contracts and 12 of the silver contracts. The link to yesterday's Issuers and Stoppers Report is here. There were no reported changes in GLD yesterday---and as of 9:52 p.m. EDT yesterday evening, there were no changes in SLV, either. Joshua Gibbons, the "Guru of the SLV Bar List" updated his website with the internal goings-on over at SLV---and for the second week in a row, this is what he had to say: " Analysis of the 19 March 2014 bar list, and comparison to the previous week's list---No bars were added, removed, or had serial number changes. As of the time that the bar list was produced, it was overallocated 99.8oz. All daily changes are reflected on the bar list." The link to Joshua's website is here. And, for the second day in a row, there were no reported sales over at the U.S. Mint. There wasn't a lot of movement in gold over at the Comex-approved depositories on Wednesday. They reported receiving only 7,330 troy ounces---and none was reported shipped out. The link to that activity is here. It was pretty quiet in silver as well, as only 936 troy ounces were received---and 60,346 troy ounces were shipped out. The link to that 'action' is here. I got an e-mail from Joshua Gibbons yesterday regarding The Tulving Company---and here's the unedited e-mail in its entirety. Hi Ed, As you are aware, The Tulving Company ceased operations on March 3. A class action lawsuit was then filed on March 6, and The Tulving Company filed for Chapter 11 bankruptcy on March 10. Over 160 people have contacted the law firm handling the class action lawsuit, claiming over $5M of unfulfilled orders. I believe the actual number of creditors will be much higher. Last week, there was a rumor that Tulving's assets were seized, but authorities would not confirm it. Today, however, it was confirmed in court documents I found, that stated: "Customer complaints led to the United States Attorney in Charlotte, N.C. opening a criminal investigation into [The Tulving Company's] business practices. On or about March 9, 2014, the United States Secret Service, working under the direction of the U.S. Attorney's Office executed a search warrant and seized all of [The Tulving Company's] computers, files, and records." It is also reported (in a different court document) that Hannes Tulving, Jr. has moved out of his residence, and his current whereabouts are unknown. It is believed that he is in hiding. JG Since yesterday was the 20th of the month, The Central Bank of the Russian Federation updated their website with the data for February. It showed that they added 200,000 troy ounces to their official gold reserves during the month---and here's Nick Laird's excellent chart updated with the appropriate number. While on the subject of Russia and gold, here's a photo of the Third Imperial Easter Egg, made by Faberge for the Russian Royal family in 1887. The story about it's incredible discovery is in the Critical Reads section. The Faberge expert who verified the discovery, compared it to " Indiana Jones finding the Lost Ark." Here's the latest FRED chart showing the St. Louis Adjusted Monetary Base. It's only $37 billion away from the $4.0 Trillion mark---and by the time you read this, we could be through it. I that Casey Research's own Jeff Clark for sharing it with us. It's another day where I have more stories than I would like, but you're "The Decider"---and I'm happy to leave the "deciding" up to you once again.
¤ The WrapAs JPMorgan’s role in the copper, gold and silver COMEX manipulations get clearer, it is natural for those concerns to elevate anxiety about an eventual sell-off. While I have those concerns as I follow COT developments closely, I am more concerned about missing the big move in silver because of a COT fake out. I’d rather get kicked in the teeth by a temporary silver sell-off at the hands of JPMorgan and the COMEX, than miss the big move due to fears of the sell-off and end up kicking myself for eternity. - Silver analyst Ted Butler: 15 March 2014 I was actually quite surprised that that the precious metals put in such a good show yesterday, as it wasn't looking good as I sent yesterday's column off to Stowe, Vermont. I was expecting far worse. I'm not sure what to make of it, if anything, but maybe they're saving a big smack to the downside for today, since it's Friday. Of course, they could get over run, or maybe they'll just put their hands in their pockets and let nature take its course. But I highly doubt it since there are only five business days left to roll out of the April delivery month in gold---and there's no sign anywhere that they're losing control of the precious metal market. Here are the 6-month charts for both gold and silver. Gold's 50 and 200-day moving averages are easy targets for the HFT boyz---and I'll be the most surprised person on Planet Earth if they don't take them both out with real authority between now and next Thursday. Silver is already $1.50 off its high tick from a week ago today---and well below its two major moving averages. But it wouldn't surprise me in the slightest if JPMorgan et al went for the jugular and pealed another dollar or so off the price in order to get the technical funds maximum short once again. You should also note that the RSI traces on both these metals are still nowhere near oversold, so unless I miss my guess entirely, I'm expecting more downside pain between now and the end of next week. Of course, as I mentioned in my last three columns---including this one, I'm amazed by the dichotomy between the silver price action---and the price action of the associated equities. And as I saidat the top of the page, I'm now convinced that somebody knows something we don't. Time will tell. As I write this paragraph, the London open is less than 15 minutes away. All four precious metals aren't doing much, or aren't being allowed to do much. For a change, net volume is very light in gold---around 15,000 contracts---and just under 5,000 in silver. The U.S. dollar isn't doing a thing. Today we get the Commitment of Traders Report for positions held at the close of Comex trading on Tuesday. I'm expecting the worst, but the price activity on Monday and Tuesday [if it was all reported in a timely manner] make take the edge off the bad news. Whatever the numbers show, I'll have them for you in tomorrow's column. And as I hit the send button on today's missive, I see that not much happened when trading began in London this morning, but less than half an hour after the open---gold, silver and platinum rallied sharply. And as of 5:10 a.m. EDT, gold is up about nine bucks, as is platinum---and silver is up about two bits off its low, and 20 cents from its Thursday close in New York. Palladium is up four bucks. Not surprisingly, gold and silver volumes have exploded---and are almost double what they were at the London open, so it's obvious that JPMorgan et al are taking on all comers in all four precious metals in order to contain these rallies. The dollar index still isn't doing much. Well, I wasn't expecting this sort of price activity today, but the response from "da boyz" was entirely predictable---and the rest of Friday's trading session in both London and New York may be even more interesting than I first thought. Before signing off, I'd like to point out that Casey Research just opened up its Casey OnePass service for a limitedtime. The deal includes subscriptions to eight of CR's newsletter all rolled into one [very] cheap price PLUS the Casey Compendium (only available to lifetime and OnePass members.) If you have any interest, you can find out more by clicking here, and it doesn't cost a thing to check it out. Naturally, Casey Research 's 90-day risk-free policy applies in full. That's more than enough for today. Enjoy your weekend, or what's left of it if you live west of the International Date Line---and I'll see you here tomorrow.
Check Out Our Best Services for Investors
- $2.5+ million portfolio
- Large-cap and dividend focus
- Intraday trade alerts from Cramer
Access the tool that DOMINATES the Russell 2000 and the S&P 500.
- Buy, hold, or sell recommendations for over 4,300 stocks
- Unlimited research reports on your favorite stocks
- A custom stock screener
- Model portfolio
- Stocks trading below $10
- Intraday trade alerts