Another down day for the precious metal stocks---and another big withdrawal from GLD. Once again, there were no changes in SLV. A tiny sales report from the U.S. Mint. Huge in/out movement in both gold and silver at the Comex-approved depositories on Wednesday
NEW YORK ( TheStreet) -- The early rally in the gold price in Far East trading got dealt with in the usual manner---and the high tick of the day came just before 3:30 p.m. Hong Kong time, which was shortly before the London open. Then shortly after London opened, the price got sold down to $1,198 in the February contract. It recovered a bit and then traded more or less sideways until shortly after 1 p.m. in London, which was about 15 minutes before the Comex open. From there it was all down hill into the 5:15 p.m. EST close of electronic trading in New York. The CME recorded the high and low ticks as $1,226.00 and $1,186.00 in the February contract. Gold closed the Thursday trading session at $1,187.80 spot, which was down $30.90 on the day. Net volume was over the moon at 220,000 contracts. The gold price came within a handful of dollars of taking out its 2013 low set back in late June. There certainly was no mercy shown in the silver price action either, but it's interesting to note that all the real damage was done shortly before 9 a.m. GMT in London, which was the low tick of the day. After that, silver recovered about twenty cents from its low and didn't do much for the remainder of the day---and basically traded flat during the entire Comex trading session, including the electronic session that followed. The high and low ticks were $19.905 and $19.10 in the March contract. That's an intraday move over 4 percent. On Wednesday, silver had an intraday move of over 3 percent. Silver closed at $19.25 spot, which was down 48 cents from Wednesday. Net volume was very decent at 51,000 contracts, but I wouldn't call it heavy, at least not compared to gold. The sell-offs extended to platinum and palladium as well, but were far more subdued---and as I mentioned in The Wrap in yesterday's column, it was probably a sympathy move rather than direct intervention. Platinum finished the Thursday session down 1.28 percent---and palladium finished unchanged. Here are the charts. Just for the record, Kitco recorded gold finishing down 2.54% yesterday, whereas silver was 'only' down 2.43%. The dollar index closed late on Wednesday afternoon in New York at 80.59---and then proceeded to trade flat in an extremely tight range on Thursday, closing at 80.65, which was up a whole 6 basis points. It was obvious that the currency moves had nothing to do with the precious metal price action yesterday, as it was equally as obvious that it was all "da boyz" just doin' the dirty. The gold stocks gapped down over 2 percent at the open, hitting their low shortly after 10 a.m. in New York. From there they worked their way slowly higher at glacial speed---and the HUI finished down only 1.72%. The silver stocks gapped down---and stayed down. Nick Laird's Intraday Silver Sentiment Index closed down 2.04%. The CME's Daily Delivery Report showed that 210 gold and 11 silver contracts were posted for delivery on Monday within the Comex-approved depositories. It was Goldman Sachs as the big short/issuer with 130 contracts, followed in distant second by Canada's Scotiabank with 52 contracts. JPMorgan Chase as the only long/stopper of note picked up another 204 contracts in its in-house [proprietary] trading account. The silver contracts were split up between JPM and Scotiabank. The link to yesterday's Issuers and Stoppers Report is here. Gold continues to exit GLD. Yesterday an authorized participant withdrew 125,388 troy ounces. And as of 8:25 p.m. yesterday evening, there were no reported changes in SLV. The U.S. Mint had a sales report yesterday, if you wish to dignify it with that name, as they only sold 3,000 troy ounces of gold eagles---and that was all. It was a very busy day over at the Comex-approved depositories in gold on Wednesday, as they reported receiving 128,504 troy ounces---and shipped 125,224 troy ounces out the door. Just eye-balling the numbers, it appears that every one of the 125,224 ounces shipped out [from two different warehouses] ended up in JPMorgan's vault. This is obviously JPMorgan taking physical delivery of some of the contracts that they've stopped so far this month. The link to all that action is here---and it's worth a peek. It was even more frantic in silver, as 1,011,875 troy ounces were reported received [all in Scotia Mocatta] and 1,005,204 troy ounces were shipped out. Of the amount shipped out, 885,000 troy ounces came out of Scotia Mocatta as well, so the forklift operators had a busy day. The link to that action is here. I have the usual number of stories for you today---and some of the gold-related ones are definitely must reads. But, as always, the final edit is in your hands.
¤ The Wrap
The surprise is that JPMorgan has also taken, in its proprietary account, delivery of 1,930 silver contracts or 61% of the 3,157 total contracts issued this month. This is a surprise because JPM is not only net short COMEX silver futures, but the above-the-law crooked bank dramatically increased its manipulative silver short position in the latest COT report. This raises a separate concern that JPMorgan may be shorting COMEX silver futures contracts to artificially depress the price so that it can pick up real metal on the cheap. I’m sure no one reading this would put this illegal motive beyond JPMorgan. - Silver analyst Ted Butler: 14 December 2013 It was another textbook case of a JPMorgan Chase et al-engineered price smash. As Ted Butler keeps mentioning to all those who are not willfully blind---first their high-frequency traders set the prices lower in the most thinly-traded markets, tripping sell stops---and then the technical fund/small traders are either forced to sell more long positions, or may decide to put on short positions for technical reasons. Either way, the collusive commercial traders are there to scoop up all the longs sold, or take the long side of the short sale. This scenario has been going on for many years---and should be completely obvious to you by now, dear reader. But what was really impressive about yesterday was all the main stream media press that occurred at the same time that this price smash was taking place. As I've said before, I don't know why JPMorgan didn't hire a brass band---and/or take out a front-page ad in either The New York Times or The Wall Street Journal, because what their doing is becoming blatantly obvious to all---well, almost all. If you read the Bloomberg story in the Critical Reads section that contained Dimitri Speck's famous charts from this latest book, then you need to look at these same charts as produced by Nick Laird. These are five-year rolling charts for both gold and silver. There are three things to note on the gold chart. On average, over the current 5-year period, the high of the day comes about 40 minutes before the London open. [Note: If you check the Kitco gold chart at the top of today's column, that's about the time "da boyz" first hit the gold price on Thursday. - Ed] The gold price gets bombed at the London a.m. and p.m. gold "fixes"---and then the cycle repeats. This is the gold price suppression scheme laid bare. The price management scheme in silver has a couple of other features associated with it. The high, before the price gets turned over, comes at the 8 a.m. London open. Then there's the a.m. gold fix, the noon silver fix in London, the perennial low that comes 10 minutes after the Comex open---and last but not least, the London p.m. gold fix. Then the pattern repeats. With five years of data condensed into one chart, the price management scheme is equally obvious here as well. All you need is open eyes---and and equally open mind---in order to see it. Some choose not to. Today we get the latest Commitment of Traders Report for positions held at the close of Comex trading on Tuesday, December 17. Both Ted and I are expecting improvements in the Commercial net short positions of both gold and silver. It's just too bad that the price/volume activity from both Wednesday and Thursday won't be included. Here are the one-year charts for all four precious metals, so you can see where we stand now that we are at, or almost at, the bottom of the price barrel for the second time this year, the last being in late June. It was fairly quiet in Far East trading in all four precious metals on their Friday---but not lost on me was the new low tick in silver that came just a few minutes before the London open. All four precious metals are in positive territory at the moment [4:39 a.m. EST] and volumes are about average for this time of day---and virtually all in the front month, which means it's mostly of the HFT variety. And, not that it matters, the dollar index is up about 11 basis points. And as I hit the send button on today's column at 5:20 a.m. EST, the quiet rallies in all four precious metals are continuing. Volumes are also getting up there a bit, especially in gold. The dollar index has sagged back close to almost unchanged. With today being Friday, I have no idea what to expect in New York trading, but if we're not at the lows, we aren't that far off. And as Ted Butler always says, its what "da boyz" do on the next rally that determines how high we go---and how fast we get there. Enjoy your weekend---or what's left of it---and I'll see you here tomorrow.