Thursday, April 24: Today in Gold and Silver
NEW YORK ( TheStreet) -- [ Note: After three years without a break, I'll be taking some time off. There will be no Gold and Silver Daily next week. Ed]
The gold price action on Wednesday was a real yawner. The only activity worthy of mention was the small rally that began at the London a.m. gold fix---and "da boyz" took care of that at exactly 1 p.m. BST---20 minutes before the Comex open. From there it got sold down to its 10:35 a.m. EDT low---and then recovered a bit before trading sideways for the remainder of the day.
The highs and lows aren't worth looking up.Gold finished the Wednesday trading session at $1,283.70 spot---unchanged on the day. Volume, net of April and May, was only 113,000 contracts. It was pretty quiet in silver yesterday as well---and there really isn't anything to talk about here. Like gold, the highs and lows aren't worth looking up. Silver closed yesterday afternoon in New York at $19.45 spot, up 6.5 cents on the day. Volume, net of roll-overs was pretty quiet at 19,000 contracts. The price action in platinum and palladium barely had a pulse, either. Here are the charts. The dollar index closed around 79.90 on Tuesday in New York---and didn't do much until moments before London opened yesterday. By 9:30 a.m. BST, the 79.70 low was in---and the index rallied quietly back to almost unchanged, as it closed on Wednesday at 79.86---down a whole 4 basis points. The gold stocks opened in the black---and then began to rally convincingly about an hour after the equity markets opened in New York. Their highs came about 2:20 p.m. EDT---and then they gave up a bit going into the close. The HUI finished up 2.07% on the day. The silver equities price path looked similar, but Nick Laird's Silver Sentiment Index closed up only 1.02% This is the second day in a row that the precious metal equities vastly outperformed the metals themselves---and I've very encouraged by that. The CME Daily Delivery Report showed that 56 gold and a whopping 151 silver contracts were posted for delivery within the Comex-approved depositories on Friday. Once again the largest short/issuer in gold was Jefferies and, once again, the two biggest long stoppers were JPMorgan and Canada's Scotiabank. But the totally out-of-the-blue surprise was the 151 silver contracts that were posted for delivery, as there was no hint of it in the current CME's Daily Information Bulletin. I would guess that this delivery was arranged privately---and left until the last possible moment. It was the biggest Comex silver short [JPMorgan] delivering to the second largest Comex silver short [Canada's Scotiabank]. One crook lending a helping hand to another crook, methinks. The link to yesterday's Issuers and Stoppers Report is here---and it's worth a quick peek. While on the subject of deliveries, according to the current CME Daily Information Bulletin, there are around 600 gold contracts still open in April---and that's netting out the deliveries due today, plus the 56 contracts posted for delivery tomorrow. Any bets that JPMorgan and Scotiabank are long/stoppers on what's left to deliver this month? The only other unknown would be the identity of the short/issuer. Jefferies, perhaps---but that's a lot of contracts for a company their size. In the end, it doesn't really matter who they are, but it's fun to speculate, now that we're down to the final days before all and sundry have to make their intentions known. There were no reported changes in either GLD or SLV yesterday. The U.S. Mint had a smallish sales report. They sold 50,000 silver eagles---and that was it. There was no in/out movement in gold at the Comex-approved depositories on Tuesday---and only smallish in/out movement in silver, as 20,717 troy ounces were received---and 88,852 troy ounces were shipped out. The link to that activity, such as it was, is here. Here are two more gold and silver charts courtesy of Nick Laird that he whipped up for us yesterday. The top chart in both is the spot price in each metal going back about 8 years. The 2-colour charts below that show the long and short positions of the Big 4 and Big 8 traders in each in the Commitment of Traders Report over the same time period. Note the short positions of the Big 8 in gold vs. the Big 8 in silver over time---especially over the last six months or so. I have very few stories for you today---and the final edit is yours.
¤ The WrapOnce in a while you will stumble upon the truth, but most of us manage to pick ourselves up and hurry along as if nothing had happened. - Winston Churchill There's not a lot to read into yesterday's price action---and it was just another day off the calendar as Ted Butler is wont to say from time to time. Here, once again, are the 6-month charts for gold and silver. With no new lows being set---and price action subdued on top of that---I doubt very much if yesterday's trading meant much as far as the Commitment of Traders Report is concerned. There are four trading days left for contract holders in the May delivery month in silver to either sell, roll, or stand for delivery---and there are still about 44,000 contracts left open. Only 5,577 were rolled yesterday, at least according to the preliminary report from the CME Group. When I checked the CME's preliminary Daily Information Bulletin that was posted on their website in the wee hours of this morning EDT---it showed the big increase in silver open interest for the April delivery month that appeared on their Daily Delivery Report late last evening. As I said earlier, it's obvious, at least to me, that this delivery from JPM to Scotiabank was privately arranged and hidden from public view until the last possible moment. As to what it portends for the future, I don't really know for sure, although I do have my suspicions---which I'll keep to myself, as it falls into the "wild-ass speculation" category. Not much of anything happened in Far East trading on their Thursday---and the same can be said now that London has been open about 20 minutes. Volumes in both gold and silver are very light---about 18,000 contracts in gold, and 4,000 contracts [net of roll-overs] in silver. The dollar index is down a handful of basis points. And as I send this out the door to Stowe, Vermont at 4:55 a.m. EDT, all four precious metals are now down a bit from yesterday's close in New York. I see that JPMorgan et al are still trying to beat up the technical funds to the down side in silver---and it remains to be seen how successful they are. But at these volume/price levels, they're picking up nickles in front of the proverbial steamroller. Volumes in gold and silver are still on lighter side, so it's not wise to read too much into this price action, even in silver---although the volume in that has picked up quite a bit, as has the roll-over action. The dollar index is still down the same handful of basis points it was 90 minutes ago. Here's the Kitco silver chart as I hit the 'send' button. That's all I have for today---and as the April delivery month winds down---and the May contract goes off the board---the price/volume activity between now and the Comex close on Tuesday, could prove interesting. See you tomorrow.
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