NEW YORK (TheStreet) -- The gold price did little of anything up until noon Hong Kong time---and after that it quietly sold off to just under the $1,300 mark. The two attempts to break back above that price got sold down almost immediately---and after the second sell-off that came just after the London close, gold traded flat for the remainder of the New York session.
The high and down price ticks aren't worth the trouble of looking up.
Gold closed the Monday session at $1,296.90 spot, down $5.40 from Friday's close. Volume, net of April and May, was extremely light at 88,000 contracts.Silver got sold off about 15 cents within the first 15 minutes of trading at the Sunday night open in New York. The subsequent 'rally' latest until 10 a.m. Hong Kong time---and then it got sold down [unsteadily] to it's low of the day which came at the noon silver fix in London. The subsequent rally got capped the moment that it hit the $20 spot price mark---shortly after the London close as well---and that was it for the day. The high and low tick were reported by the CME Group as $20.015 and $19.775 in the May contract. Silver finished the day at $19.865 spot, down 9 cents from Friday's close. Net volume was fumes and vapours at 15,500 contracts. Like gold and silver, platinum and palladium were under selling pressure for virtually the entire day, with most of the selling pressure really getting started around noon Hong Kong time. Then platinum got hit for $20---and palladium got smoked for over 3% starting shortly after the London close---about the same time as gold and silver got sold down. After the spikes down in their respective prices, they didn't recover much. The dollar index closed on Friday at 80.43. It traded pretty flat until around 12:30 p.m Hong Kong time---and then began to head south, hitting its 80.20 low just before 12 o'clock noon in New York. After that it traded almost ruler flat into the close, finishing the Monday session at 80.22---down 21 basis points on the day. The interesting thing to note is that virtually all of the major price declines in all four precious metals occurred between noon in Hong Kong and noon in New York yesterday. It's a pretty safe call to say that there was absolutely no correlation between the dollar index and precious metal prices yesterday. With the gold price, along with the general equity markets, both in the red yesterday, it was a bit of a surprise to see the gold stocks in the green. Of course, once the gold price got smacked back below the $1,300 spot price mark after the London close, down went the gold stocks as well. But, despite that, they continued to rally after that---and closed virtually unchanged---down 0.07%. The silver shares followed a similar price/chart pattern, but Nick Laird's Intraday Silver Sentiment Index closed down a somewhat more substantial 1.18%. The CME's Daily Delivery Report showed that 8 gold and 3 silver contracts were posted for delivery within the Comex-approved depositories tomorrow. The Issuers and Stoppers Report isn't worth linking. I note that there are about 1,300 gold contracts still open in the April delivery month, along with a tiny handful of silver contracts. There were no reported changes in GLD yesterday---and as of 10:36 p.m. yesterday evening, there were no reported changes in SLV, either. There was a decent sales report from the U.S. Mint yesterday. They sold 1,500 troy ounces of gold eagles---3,000 one-ounce 24K gold buffaloes---and 659,500 silver eagles. Over at the Comex-approved depositories on Friday, they reported receiving 37,779 troy ounces of gold, most of which went into the depositories over at HSBC USA. Only 291 troy ounces were reported shipped out. The link to that activity is here. In silver, there was 498,354 troy ounces reported received---and all of it disappeared into the Delaware depository. 39,020 troy ounces shipped out. The link to that action is here. I have a decent number of stories for you today---and I'll leave the final edit up to you.
¤ The WrapIt’s important to remember that the Mint is producing and selling Silver Eagles at record capacity this year, yet is still, in effect, unable to keep up with demand. This is a familiar circumstance with Silver Eagles over the past few years, a circumstance not witnessed with Gold Eagles in general. Along with the highly unique movements in COMEX warehouse inventories, this is another decidedly physical factor specific to silver. While I don’t know who the big buyer of Silver Eagles may be, certainly we can conclude that the buyer strongly expects higher silver prices in time (no one buys anything investment related with the expectation of lower prices). A subscriber passed along a thought that was already in the back of my mind, namely, that buying Silver Eagles from the Mint might be a way for a big buyer to accumulate physical silver with very little impact on price. I can’t help but think that the COMEX silver warehouse shuffling and extraordinary Silver Eagle sales are two big factors in a developing silver physical story that could [and should] end in pronounced shortage. - Silver analyst Ted Butler: 05 April 2014 Even though volumes in both gold and silver were very light on Monday, it was obvious that there was a seller there to make sure that gold closed below $1,300---and silver below $20 spot. Why platinum got hit---and palladium hammered---certainly had nothing to do with any real-world supply/demand fundamentals that I'm aware of. But, like they are in gold and silver, JPMorgan et al can do pretty much as they please in the precious metal arena, as no one is going to life a finger to stop them, or utter a word in protest. Yesterday's price action in all four precious metals had their boot prints all over it. Here are the 6-month charts for both gold and silver once again. Nothing has changed as far as Ted's [and my] opinion of the situation, as the technical set up still indicates that "da boyz" could peel another $100 off the gold price---and a more than a buck off silver. We could also blast off from here as well---and I certainly don't want to say "This time it's different"---as that will be the kiss of death for sure. As I said on several occasion last week, the latest being Saturday, that all we can do is wait this out and see what develops. In Far East trading on their Tuesday, all was quiet once again, although prices developed a positive bias right from the open in early morning trading---and volumes were very light, although not quite as light as they were on Monday. That all changed in gold and silver around 1:30 p.m. Hong Kong time, as gold spiked above $1,300 the ounce and silver above $20 the ounce. Platinum and palladium were up a decent amount as well, but their rallies were much more subdued. And as I type this paragraph, London has been open about 35 minutes---and it's obvious that the prices of both gold and silver are being actively capped, as volumes have exploded---and are up more that 100% from what they were before the price spikes occurred. So it's obvious that JPMorgan et al are throwing a blizzard of Comex paper at both metal to kill these rallies. The dollar index, which had been trading as flat as the proverbial pancake for most of the Far East trading session, began to head south around 2:45 p.m. Hong Kong time---about 15 minutes before the London open. This is what the Kitco gold chart looked like at 5:25 a.m. EDT. And as I hit the 'send' button on today's efforts at 5:28 a.m. EDT, all four precious metals continue to struggle higher as JPMorgan et al throw everything they can at their prices. Gold volume is almost triple what it was about three hours ago. Silver is still above the $20 spot price mark, but struggling. Volume is well over double what it was before this rally started, but still very low all things considered---around 8,300 contracts. The volumes in both silver and gold are almost all confined to their respective current front months---so it's obvious that the HFT boyz are out in force. Platinum and palladium are still up, but have made little upwards progress since London opened, as even the tiniest rally is being sold down. The dollar index is now a hair below the 80.00 mark---and currently down about 25 basis points from Monday's close in New York. I haven't the foggiest idea what price scenarios will greet me when I power up my computer later this morning, but the one thing that is obvious, is that JPMorgan et al have no intentions of letting precious metal prices rise at the moment, as they have obviously drawn a line in the sand here. Could they get over run? Sure, but if they do, it will be---as Ted Butler is wont to say from time to time---the first time it has ever happened. So the odds aren't lookin' good. But one of these days it will be different. I'm off to bed. See you here tomorrow.
Select the service that is right for you!COMPARE ALL SERVICES
- $2.5+ million portfolio
- Large-cap and dividend focus
- Intraday trade alerts from Cramer
- Weekly roundups
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
- Upgrade/downgrade alerts
- 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 + Doug Kass Plus 15 more Wall Street Pros
- Intraday commentary & news
- Ultra-actionable trading ideas
- 100+ monthly options trading ideas
- Actionable options commentary & news
- Real-time trading community
- Options TV