Gold shares down again, silver shares up a hair. Withdrawals from both GLD and SLV on Friday. No sales report from the U.S. Mint. Tiny in/out movement in gold in the Comex-approved depositories, but monster moves in silver stocks on Thursday. The COT Report in both gold and silver was amazing!
NEW YORK ( TheStreet) -- Except for a slight bump up in price beginning at the noon silver fix in London and ending 10 minutes before the Comex open, there was no price activity worthy of the name anywhere on Planet Earth yesterday, and the highs and lows aren't worth mentioning. Gold finished the Friday session at $1,243.70 spot, up $1.30 from Thursday's close in New York. Gross volume was big, but was irrelevant, as once the roll-overs and spreads out of the December delivery month were subtracted out, the net volume was a microscopic 53,500 contracts. It was virtually the same story for the silver price, including the price bump at the London silver fix, and the price was never allowed to stray too far above the $20 spot price mark. Silver traded in a two bit price range for all of Friday. Silver closed yesterday at $19.83 spot, down 15.5 cents from Thursday. Net volume was an even more microscopic 16,500 contracts. Platinum was slightly more interesting, rallying in fits and starts until shortly after 9 a.m. in London. A willing seller showed up at that point and took the price below its Thursday close in New York. But once the noon silver fix was in, another rally began that got capped as soon as the Comex began trading. Then down went the price once again, with a final kick in the pants just before the 5:15 p.m. electronic close. Palladium traded flat until 2 p.m. Hong Kong time, and then rallied a bit into the noon silver fix, before blasting skyward. But a seller of last resort put in an appearance 10 minutes before the Comex open, and the price was firmly back under control an hour before the Zurich close. From there it traded sideways for the rest of the Friday session. The dollar closed on Thursday a hair above the 81.00 mark, with the top [81.08] coming shortly after 11:30 a.m. Hong Kong time. From there, it was a long gentle slide into the end of the trading day in New York. The index closed on its absolute low of that day, which was 80.70, down 31 basis points from the prior day. The gold stocks gapped up a hair at the open, hitting their high of the day less than 10 minutes later, and it was all down hill until 2 p.m. EST. From there the HUI traded more or less sideways before closing virtually on its low of the day, down 0.94%. Despite the fact that the silver price finished in the red, the equities actually eked out a small gain, as Nick Laird's Intraday Silver Sentiment Index closed up a smallish 0.18%. The CME's Daily Delivery Report showed that 26 gold and zero silver contracts were posted for delivery within the Comex-approved depositories on Tuesday. The only short/issuer was Jefferies, and the biggest long/stopper was JPMorgan Chase with 14 contract for its in-house [proprietary] trading desk. The link to yesterday's Issuers and Stoppers Report is here. There with withdrawals from both GLD and SLV yesterday. In GLD, an authorized participant withdrew 144,723 troy ounces, and in SLV it was 1,444,584 troy ounces. The U.S. Mint did not have a sales report on Friday. The in/out activity in gold on Thursday over at the Comex-approved depository is hardly worth writing about, as only 64 troy ounces were reported received, and 98 ounces shipped out. But there was big activity in silver, as 2,554,353 troy ounces were received, and 18,335 troy ounces shipped out. The big receipt was 1.954 million ounces at HSBC USA. The link to that action is here. Yesterday's Commitment of Traders Report showed improvements in both gold and silver far bigger than I was expecting. Ted Butler said it probably included some catch-up numbers from the prior reporting week as well. And whether that omission was deliberate or accidental is hard to say, but whether or it was or not, the report was impressive. In silver, the Commercial net short position declined by a chunky 20.7 million troy ounces. It's now down to 17,464 contracts, or 87.3 million ounces. That's not the lowest number we've seen, but it's within spitting distance of it. Of course the brain dead technical funds and small traders did their Pavlovian thingy; pitching longs and/or going short in a big way. JPMorgan Chase et al happily stood by and bought all the longs they were selling, and took the long side of all the short positions that were put on. Ted says that JPMorgan Chase's short position in silver is back down to the 12,000 contract mark once again, and that represents 64% of the entire Commercial net short position in silver. JPMorgan's short-side corner in the silver market is about 11% of the entire Comex futures market on a net basis. In gold, the Commercial net short position declined by 1.43 million ounces, and is now down to 5.15 million ounces. Once again JPMorgan et al feasted on the long positions being sold by the technical funds and small traders, and also took the long side of every short position these same traders were putting on. It's the same old routine. Ted figures that JPMorgan's long-side corner in gold now sits at 7.5 million ounces. That being the case, the other commercial traders [other than the collusive raptors] must be net short the gold market to the tune of 12.65 million ounces to make the Commercial net short position work out to the number shown in this week's COT Report. The numbers for copper are even more mind-boggling, and JPMorgan is the big long there as well. You couldn't make this stuff up. Of course, since the Tuesday cut-off, there's been another big decline in the prices of both gold and silver, especially the hammering they took on Wednesday, the day after the cut-off. And not to be forgotten are the carefully placed new low ticks in both metals that was engineered at the London p.m. gold fix on Thursday. Both these events are clearly visible on the Kitco charts at the top of this column, so take another look at them. If we survive Monday and Tuesday without any major price rally, then next Friday's COT Report should show even more improvement in the Commercial net short position in both metals and, of course, in conjunction with new shorting/long selling by the technical funds and small traders. Since we are down to the final days of the roll-over out of the December delivery month in silver and gold, I'm not expecting much to happen to the upside as far as prices are concerned. But as I've said many times in the past, one should always be on the look out for "in your ear" regardless. Despite my best editing efforts, I have too many stories today that I didn't have the heart to delete, so I'll wimp out and let you do it for me. A lot of them are centered around the New Great Game.
¤ The Wrap
There are other bigger forces at play here, forces that are also responsible for changing sentiment with regard to gold… and thus persuading weak holders to offload their holdings. - Lawrence Williams: Mineweb.com, 18 November 2013 Today's pop 'blast from the past' was a big disco hit for this Swedish pop group back in 1979. The band, and the song, require no further introduction, and the link is here. Today's classical 'blast from the past' is something that I'm sure I've posted here before, but I just can't remember exactly when, or who the soloist was. Not that it matters, I suppose. This is Camille Saint-Saëns' " Introduction and Rondo Capriccioso" which he composed in 1863, for the then 18 year old Spanish violin prodigy Pablo de Sarasate. Considering who he wrote it for, it had to be a virtuoso piece of the first order. And it was. The incomparable Dutch violinist Janine Jansen does the honours here, and she plays like the devil himself has possessed her. I consider this performance to be the definitive version of this work, and she's awesome to watch as well. The link to this youtube.com video is here. Enjoy! Yesterday's Commitment of Traders Report, for positions held at the close of Comex trading at 1:30 p.m. EST on Tuesday, is all the proof necessary that we are at another major low in gold and silver prices. That, and the price action on both Wednesday and Thursday were the icing on the cake, and I'd be prepared to be a fair chunk of change that we saw the low at the London afternoon gold fix on Thursday. So where to from here once we get past First Notice Day for the December delivery month? As I mentioned earlier this week, we've been at this particular brink several times already this year. It's hard to imagine JPMorgan Chase being more favourably positioned than they are now. True, they still hold a short-side corner in the Comex futures market in silver, but Ted Butler feels that they are most likely covered in other markets; of course not forgetting their massive long-side corner in the gold market as a visible loss-covering mechanism on any dramatic rise in price in both metals. And as is always the case at moments like this, it's what JPMorgan et al do as this inevitable rally unfolds [in all four precious metals, plus copper] that will 100% determine how high we go, and how fast we get there. Will they step in front of it again, or step aside? Nothing else matters. I'm done for the day, and the week. Enjoy what's left of your weekend, and I'll see you here on Tuesday.