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Wednesday, April 2: Today in Gold and Silver

NEW YORK ( TheStreet) -- It was a very quiet day in gold pretty much everywhere on Planet Earth yesterday.  Volume wasn't overly heavy, so not much can be read into Tuesday's price action.  However, one thing I did note, was the price action on Tuesday was almost a carbon copy of the price action on Monday

The high and low, if you wish to dignify them with that description, were recorded by the CME Group as $1,288.40 and $1,277.40 in the June contract.

Gold finished the Tuesday session in New York at $1,279.80 spot, down an even five bucks from Monday's close.  Volume, net of April and May, was around 120,000 contracts.

The silver price action had a little more shape to it, but not a lot.  The low tick came shortly before 11 a.m. in Hong Kong---and the high occurred minutes after 9 a.m. BST in London, safely below the $20 spot mark.  The silver price got sold down a bit from there---and then traded in a 15 cent range for the remainder of the Tuesday session.

The high and low here were $19.91 and $19.635 in the May contract.

Silver finished the trading day at $19.76 spot, up a whole half a cent.  Net volume was pretty light at 22,500 contracts.

The platinum price didn't do anything in Far East trading on their Tuesday, but began to rally with some strength beginning at the 8 a.m. London open.  That lasted for two hours--and then began to rally anew about 12:30 p.m. BST.  But the moment that Comex trading began 50 minutes later, there was a not-for-profit seller laying in wait---and that was it for the day.  Platinum closed up a whole five bucks.

Palladium got sold down to its low of the day at 10 a.m. Hong Kong time.  From there it struggled higher before beginning to rally a bit more strongly starting shortly after 12 o'clock noon in London.  The high was in around 1 p.m. EDT---and the metal traded sideways from there.

The dollar index closed in New York late on Monday afternoon at 80.11---and didn't do much until shortly after 8 a.m. in New York.  Then twice within the space of three hours the index dropped below the magic 80.00 mark, only to be rescued by a not-for-profit buyer.  The index closed at 80.08 on Tuesday---basically unchanged from Monday's close.

The gold stocks gapped up a percent and change at the open, with the high coming minutes after the 10 a.m. EDT London p.m. gold fix. From there the shares began to slide, hitting their low of the day shortly after 2 p.m.---and then rallied unsteadily into the close, just managing to finish in the black, as the HUI closed up 0.35%.

The price pattern in the silver equities was virtually identical---and Nick Laird's Intraday Silver Sentiment Index closed up an even tinier 0.23%.  But it's better than the alternative.

The CME's Daily Delivery Report for 'Day 3' of the April delivery month showed that 79 gold and 210 silver contracts were posted for delivery within the Comex-approved depositories on Thursday.  In gold, the biggest short issuer was F.C. Stone with 60 contracts---and the two biggest long/stoppers were Canada's Bank of Nova Scotia---and JPMorgan Chase in its in-house [proprietary] trading account with 41 and 18 contracts respectively.  In silver, JPMorgan issued all 210 contracts out of its in-house [proprietary] trading account---and Canada's Scotiabank stopped 205 of them.  The link to yesterday's Issuers and Stoppers Report is here.

Another day---and another withdrawal from GLD.  This time it was only 67,443 troy ounces.  And as of 10:03 p.m. EDT yesterday evening, there were no reported changed in SLV.

The U.S. Mint had a sales report yesterday.  They started off the new month with sales of 5,500 troy ounces of gold eagles---3,500 one-ounce 24K gold buffaloes---293,000 silver eagles---and 200 platinum eagles.

Over at the Comex-approved depositories on Monday there were 32,103 troy ounces of gold deposited into Scotiabank's vault---and 32,103 troy ounces withdrawn from HSBC USA.  The link to that activity is here. In silver, nothing was reported received, but 694,053 troy ounces were shipped out, with virtually all of it coming out of Scotiabank's warehouse.  The link to that activity is here.

From feast to famine.  Yesterday I had more stories than I [or you, probably] knew what to do with.  Today it's the opposite, so I hope you can find something of interest amongst the few posted below.

¤ The Wrap

The other standout in silver this year is in the large amount of Silver Eagles being sold, both on an absolute and relative basis from the U.S. Mint. There may be one more update on Monday [There wasn't - Ed] but the data through Friday continues to confirm a very large number of Silver Eagles being sold this year. From what I hear, it is not John Q. Public doing the buying. I don’t know who it is, but someone sure is buying Silver Eagles aggressively. Since I don’t know who is buying, I also can’t know if the buying will continue.

What is most peculiar is that the demand for Gold Eagles has trailed off in the face of Silver Eagle demand. Year to date, 13 million oz of Silver Eagles have been sold versus only 142,000 oz of Gold Eagles, a record ratio of 91 Silver Eagles to every one oz of Gold Eagles. Just to put this into perspective, the year 2013 witnessed the highest number of Silver Eagles to Gold Eagles in history at 50 to 1. This year, in the face of rotten relative price performance for silver compared to gold, the Mint is reporting relative demand has increased 80% for Silver Eagles compared to Gold Eagles. I keep saying this pace can’t continue and hope that I will continue to be wrong. - Silver analyst Ted Butler: 29 March 2014

It was another day where not much happened, or was allowed to happen, in any of the four precious metals.  What intervention there was, was particularly obvious in the platinum market at the Comex open.

But the one thing that I have noticed is that JPMorgan et al have not been that aggressive to the downside in the last few days, especially in silver.  As I've been stating---and as Ted Butler first pointed out---the potential exists for "da boyz" to still kick the living snot out of the precious metal prices because of the current configuration of the COT Report, with the technical funds still being massively long compared to their positions back at the lows of late December 2013.  So the jury is still out as to whether this pounding is currently in the cards or not.  For the moment, they seem content to take a small slice off the gold salami every day---and why they're not doing that in silver at the moment is impossible to know.

But whatever price action we see going forward will have nothing to do with the free market, either to the upside, or the downside.

Here are the usual 6-month charts for both gold and silver.

As has been the case for most of the precious metals so far this week, there hasn't been much price activity of note during the Far East trading sessions---and this trend continued on Wednesday as well.  All four precious metals, with the exception of palladium, are up a bit now that London has been open about 35 minutes.  Volumes in both gold and silver are on the lighter side---and I note that someone stepped in to save the dollar index from plunging below the 80.00 mark once again [the fourth time in less than 48 hours] just minutes before the London open.

I have nothing else to add to today's column.  Everything that has to be said, has been said over the last few days---and I'm sure you're just as sick of reading it, as I am or writing it.  All we can do is sit here and await developments.  That's all I'm doing at the moment.

And as I fire today's column out the door at 5:12 a.m. EDT, I note that nothing has changed since I wrote my comments about London trading almost two hours ago.  Gold, silver and platinum are hanging on to small gains---and the palladium price is still unchanged.  Volumes are up, but about average for this time of day, whatever that means---and the dollar index is still hanging onto the 80.00 level for dear life.

I'm off to bed---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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