NEW YORK (TheStreet) -- As is usually the case, the price pressure on gold was of the downward nature at the 6 p.m. New York opening on Sunday evening. But the spike down shortly before 8 a.m. Tokyo time ran into some decent buying---and the price was back to unchanged noon Hong Kong time. It drifted five bucks higher during morning trading in London---and then took off to the upside---and back above $1,300 spot---at the New York open in what all the appearances of a 'no ask' market. That state of affairs lasted for a good 10 minutes before a seller of last resort put in an appearance---and from there, gold got sold down to its New York open by the 5:15 p.m. close of electronic trading---and back below $1,300 spot, of course.
The low and high ticks according the to the CME were $1,277.70 and $1,304.50 in the June contract.
Gold finished the Monday session at $1,295.70 spot, up $5.60 from Friday's close. Net volume was not overly heavy at 103,000 contracts, but a decent chunk of that came during the first few hours of Far East trading.The silver price action was very similar to gold's, except for the smallish rally that began shortly after the London a.m. gold fix. That wasn't allowed to go very far---and the big rally at the New York open got dealt with in the usual manner. The low and high price ticks in silver were reported as $19.045 and $19.67 in the July contract, an intraday move of more than 3%. The silver price closed in New York yesterday at $19.50 spot, up 34.5 cents from Friday. Volume, net of May and June, was pretty heavy at 45,000 contracts, with about 20% of that amount occurring before lunch in Hong Kong. Platinum and palladium prices also got sold down a bit at the New York open on Sunday night, with both back to unchanged by noon Hong Kong time. Their rallies that began around 11 a.m. in Zurich didn't get far---and most of their slender gains disappeared in late trading in New York. Here are the charts. The dollar index closed late on Friday afternoon in New York at 79.87---and did virtually nothing during the entire Monday trading session. It finished the day basically unchanged at 79.88. Here's the US$ Index chart which includes the Friday trading day in North America. The gold stocks gapped up a bit less than 2% at the open---hitting their high ticks around 10:30 a.m. in New York---then gradually weakened as the trading session wore on, giving up about a percent of their gains in the process. The HUI finished up 1.23%. It was an entirely different chart pattern for the silver equities. They hit their high shortly after noon in New York---and then slide back to unchanged by 2:15 p.m. EDT. They barely finished above unchanged, as Nick Laird's Intraday Silver Sentiment Index closed up 0.15%. I was underwhelmed. The CME Daily Delivery Report showed that 2 gold and 192 silver contracts were posted for delivery within the Comex-approved depositories on Wednesday. In silver, the big short/issuer was Jefferies once again with 173 contracts out of its in-house [proprietary] trading account, along with another 10 contracts issued from its client account. JPMorgan stopped 96 contracts---and the second biggest long/stopper was Credit Suisse with 27 contracts. There was whole raft of other stoppers as well. The link to yesterday's Issuers and Stoppers Report is here---and it's worth a quick peek. After 10 days of no activity, there was finally a withdrawal from GLD yesterday, as an authorized participant took out 77,044 troy ounces. And as of 6:28 p.m. EDT early yesterday evening, there were no reported changes in SLV. Late last week the good folks over at the shortsqueeze.com Internet site update their website with the new short positions in both GLD and SLV for the end of April---and there were decent increases in both metal. The short position in SLV increased by a chunky 19.84%---from 12.44 million shares/troy ounces to 14.90 million shares/troy ounces. The GLD ETF increased by 14.80%---from 1.00 million troy ounces, up to 1.15 million troy ounces. This is what silver analyst Ted Butler had to say about it in his weekly commentary to his paying subscribers on Saturday: "The increase in SLV, while sizable in percentage terms, equates to 500 COMEX contracts and just over 4.3% of total shares outstanding. In GLD, the short position increased to 4.4% of total shares outstanding. Over the past few months the short positions in SLV and GLD have declined noticeably, so I am not inclined to hit the panic switch at this time. There always exists the possibility, particularly in SLV, that shares were shorted because physical silver was not available for deposit, but more data is needed before definitely concluding that." Surprisingly enough, there was no sales report from the U.S. Mint yesterday. But it was a different story over at the Comex-approved depositories on Friday, as HSBC USA took in a big chunk of gold again. This time it was 156,217 troy ounces. The link to that action is here. Friday was also another big day for silver as well. They reported receiving 991,932 troy ounces---and shipped out only 139,689 troy ounces. The link to that activity is here. Here's Nick Laird's updated chart for Chinese gold imports through Hong Kong for the month of March. As time goes on, I would expect that China will import less through Hong Kong where their imports are visible---and more through their new imports-through-Beijing policy that's due to start in June, I believe. However, I doubt very much that their total gold imports overall will change much---and the chart posted below still speaks volumes. Before hitting the stories, here's a little eye candy that I found tucked away in the "Documents" section of my computer. I know I've posted it before, but I just can't remember when. I don't have all that many stories for you today---and the final edit is yours.
¤ The WrapThere was speculative buying in the silver ETFs, particularly the big silver EFT, SLV, that came to be liquidated in the deliberate price smash of May 2011, but that’s my point. It was that physical buying that brought us to the brink of a silver shortage and it will most likely be that type of buying again that will ignite silver to the upside. As for what has accounted for the dismal silver price performance over the past three years that seems abundantly clear. Once the back of silver price momentum was broken in 2011, the big silver investment demand was broken as well. With physical silver investment demand muted, JPMorgan and the other crooks on the COMEX have had an easy time controlling prices with their dirty trading tricks. <.p> The only question for the future is if silver investment demand will ever revive and overpower the COMEX price control? To me, and for anyone buying and holding silver, the answer is, of course, silver investment demand will grow again to the point where a world shortage is back in the crosshairs. Just like occurred, beginning in late 2010, silver investment demand will squeeze available physical supplies. No one can tell you exactly when that will occur; all we can do is monitor developments most likely to tip us off. - Silver analyst Ted Butler: 10 May 2014 Well, it would have been an exciting day in the precious metals on Monday, but it was obvious once again that those with the HFT algorithms were running the show to the downside---and probably the upside as well. It took a decent amount of Comex paper in the early going in Far East trading on their Monday morning, but that, as always, was an easy task for JPMorgan et al. Here are the 6-month charts for both gold and silver. As you can tell from the gold chart, it blasted through the $1,300 spot price mark---and the 200-day moving average, with ease. It would have probably sliced through the 50-day moving average as well---however, it appeared [at least to me] that a seller of last resort was there to ensure that not only did that event not happen---but the gold price was closed back below the 50-day moving average and the $1,300 price mark. Someone defending a short position, perhaps? Silver was closed a few pennies above its 20-day moving average, but well off its high tick. In Far East trading on their Tuesday, I note that three of the four precious metals are trading down from Monday close in New York. Only palladium is unchanged. Gold volume, which is all of the HFT variety in the current front month, is already pretty chunky---and north of 16,000 contracts with 1:20 minutes to go before the London open. Silver's volume is pretty light. The dollar index isn't doing a thing, but still hanging just around under the 80.00 mark after its "miraculous" recovery from below 78.95 on Thursday morning in New York. Today at the close of Comex trading at 1:30 p.m EDT is the cut-off for this Friday's Commitment of Traders Report---and I'll be more than interested in what happens price-wise with both silver and gold during the Tuesday trading session, particularly in New York. And as I hit the send button on today's efforts at 4:25 a.m. EDT, I see that nothing much has changed now that London has been open for an hour and a bit. With the exception of platinum, which is unchanged, the other three precious metals are still down a bit. Gold volume is just about double what it was from when I reported on it about three hours ago, and is now 31,000 contracts. Silver's volume is nothing special---and the dollar index is still flat. That's all I have this time. I hope your day goes well---and I'll see you here tomorrow.
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