Friday July 26 – Today In Gold & Silver

NEW YORK ( TheStreet) -- The gold price was comatose in Far East trading on their Thursday, but got hit for ten bucks shortly after 10:00 a.m. BST in London trading.

The low [around $1,309 spot] was in just before 11:00 a.m… and the subsequent rally tried to run away to the upside shortly after the Comex open in New York, but that wasn't allowed to get far… and the gold price chopped unsteadily higher from there… hitting its spike high tick of $1,339.10 spot around 4:15 p.m. EDT in the New York Access Market.  After that, it traded sideways into the close.

The gold price finished the Thursday session at $1,334.10 spot… up $12.50 on the day.  Net volume, once all the roll-overs out of the August delivery month were subtracted out, was rather quiet… around 107,000 contracts.

Once again the chart pattern in silver was almost identical to the gold chart… with the inflection points all coming at the same times as well.  The low tick, around $19.75 spot, came at the same time as gold… a few minutes before 11:00 a.m. BST.  The silver price wanted to fly at the Comex open as well, but got capped… and the 4:15 p.m. spike high was recorded by Kitco at $20.44 spot.

Silver closed at $20.25 spot… up a dime from Wednesday.  Gross volume was only 30,500 contracts.

Here's the New York Spot Silver [Bid] chart on its own… and the price details of the New York market are more obvious.

Platinum and palladium had minds of their own again yesterday, but the rallies in both ended up on the rocks, just like they did on Wednesday.  The palladium price even got capped at exactly the same time on both days… just minutes after 11:00 a.m. in New York.  Here are the charts… 

It was obvious that all four precious metals would have rallied far more than they did in the New York session, if they had been allowed to trade freely… which they weren't.

The dollar index closed late on Wednesday afternoon in New York at 82.30… and the slid a bit in Far East trading.  The index began to rally starting at 8:00 a.m. BST in London… and hit its zenith of 82.40 around 10:40 a.m. BST..and it's nadir [81.63] came just minutes after 4:00 p.m. in New York.  [The dollar index high tick came within minutes of the London a.m. gold fix… if not at it.]  From there it recovered a bit into the close… finishing the Thursday trading session at 81.77… down 53 basis points from Wednesday.

The gold stocks traded in negative territory very briefly at the open of the equity markets in New York… but were soon back in the black.  The high tick in the shares came around 11:30 a.m. EDT… and then drifted quietly lower into the close.  The HUI finished up 1.13%.

Despite the tepid performance of the metal itself, the silver equities turned in a very decent performance on Thursday… and Nick Laird's Intraday Silver Sentiment Index closed up 1.79%.

(Click on image to enlarge)

The CME's Daily Delivery Report hasn't changed much all week.  Yesterday there were zero gold and 16 silver contracts posted for delivery within the Comex-approved depositories on Monday.  The short/issuer on all 16 contracts was Canada's Bank of Nova Scotia… and the biggest long/stopper was JPMorgan Chase out of its in-house [proprietary] trading account, picking up 12 contracts.  These guys are still picking up nickels in front of the steamroller.  The link to yesterday's Issuers and Stoppers Report is here.  Net of all outstanding delivery notices, there are still over 140 silver contracts left open in July.

Despite the rally in gold during the last month, physical metal continues to be removed from GLD.  Yesterday an authorized participant withdrew another another 77,290 troy ounces… and as of 10:08 p.m. EDT, there were no reported changes in SLV.

Joshua Gibbons, the "Guru" of the SLV Bar List, updated his website with SLV's data for the end of business on Wednesday, June 24th.  This, in part, is what he had to say… "Analysis of the 24 July bar list, and comparison to the previous week's list… 5,170,842.9 oz. were added (2.4M oz. to Brinks London, 2.8 M oz. to JPM London V).  2,758,968.9 oz. were removed (all from Brinks London), no bars had a serial number change.

"The bars added were from: Russian State Refineries (1.5M oz.), Aurubis AG (1.2M oz.), Nordeutsche (0.9M oz.), and 8 others.  The bars removed were from: Aurubis AG (1.2M oz.), Nordeutsche (0.9M oz.), and Shui Kou Shan Mining (0.6M oz.)."

"Analysis shows that this was really a 2,411,874 oz. addition, and transfer of 2,758,968.9 oz. from one vault to another ( not a replacement)."

The link to all the data is on Joshua's website linked here.

Once again, there was no sales report from the U.S. Mint.

Wednesday was another busy session for silver over at the Comex-approved depositories.  They reported receiving 617,735 troy ounces… and shipped 1,099,750 troy ounces out the door.  The link to that activity is here.

These depositories reported no in or out activity in gold on Wednesday.

Just as a point of interest… and it may mean nothing in the grand scheme of things… but for the second time in a week there has been a 'transfer' of silver from the Scotia Mocatta warehouse into the JPMorgan Chase depository.  On Tuesday, it was 596,859 troy ounces.  The other time time there was a 'transfer'… it involved a very similar amount.

And it's not like there haven't been intra-depository movements before, but I'm particularly sensitive to transfers into JPM's depository… as they seem to be a 'black hole' for the stuff, because it always seems to be going in… and hardly ever comes out.

Here's Nick Laird's chart of JPMorgan Chase's silver depository stocks since its inception… which was within days of the May 1, 2011 drive-by shooting in silver that they certainly had a hand in.  I doubt very much that theses two events are unrelated.

(Click on image to enlarge)

Yesterday was a pretty slow news day… and I'm happy to report that I don't have a lot of reading material.

¤ The Wrap

Based upon the most recent COT report, as of July 16, I estimate JPMorgan’s net long position in COMEX gold futures to be 75,000 contracts. After subtracting 77,000 spread positions from total open interest of 440,283 contracts, true net open interest in COMEX gold futures is just over 363,000 contracts. Therefore, JPMorgan’s 75,000 contract net long position represents more than 20% of the entire COMEX gold futures market on the long side. First, JPMorgan had a 14% market share on the short side and now they flipped that into a 20% share of the long side, as a result of JPMorgan manipulating the price of gold nearly $500 lower. These are extraordinary and dominant market shares… and unprecedented price rigs to the downside. To not see them as cause and effect is to miss the obvious. - Silver analyst Ted Butler… 24 July 2013

It's difficult to say what caused the gyrations in both gold and silver yesterday, but it didn't look like free-market forces to me.  However, it could have been partly associated with the last of the roll-overs out the August delivery month in gold, which have to be completed by the end of trading on Tuesday… unless they're standing for delivery.  And as I mentioned in The Wrap yesterday, I'll be more than interested in seeing just how much gold JPMorgan picks up for its own account in August.

Today we get the latest Commitment of Traders Report for positions held at the 1:30 p.m. EDT close of Comex trading on Tuesday.  Just eye-balling the gold and silver charts for the reporting period, I'd guess we'll see a rather large increase in the Commercial net short positions in both metals.  The only thing that's not known is whether the deterioration resulted from JPMorgan going short against all the new longs coming into the market… or whether it was the raptors [the Commercial traders other than the Big 8] selling long positions and taking profits.

Whatever the number show, I'll be reporting on it in my Saturday column.

Very little happened in Far East trading on their Friday… and both gold and silver began to develop a negative bias around noon in Hong Kong… and that trend has continued into the London open.  Volumes at the moment [3:17 a.m. EDT] are exceptionally light… and the dollar index isn't doing a lot.  And as I hit the 'send' button on today's column at 5:05 a.m. EDT, gold is down about five bucks… and silver is down about 15 cents.  Volumes have picked up a bit… and the dollar index still isn't doing much.

Since today is a Friday, nothing will surprise me during the New York trading session.

Have a good weekend… and I'll see you here on Saturday… Sunday west of the International Date Line.

This is an abbreviated version of Ed Steer's Gold & Silver DailySign-up to have to the complete market review delivered to your email inbox each morning for free.


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