Wednesday, January 29: Today in Gold and Silver

NEW YORK ( TheStreet) -- There wasn't a lot of price activity during the Tuesday session anywhere on Planet Earth yesterday---and I wouldn't read anything into what little price action there was.

As I mentioned in this space yesterday, the roll-overs out of the February contract are in their final few days.  All contracts, except those standing for delivery in February, have to have sold or rolled by the close of Comex trading tomorrow.

The highs and lows aren't worth my while to even look up.

The gold price closed in New York late Tuesday afternoon at $1,255.70 spot, which was down 80 cents from Monday's close.  Gross volume was over the moon, but net volume was a microscopic 53,000 contracts.

The silver price chopped sideways for all of Far East and most of London trading yesterday---and then got smacked by the HFT boyz at the 9:30 a.m. EST open of the equity markets in New York.  By the time the London gold fix was in 30 minutes later, JPMorgan et al had peeled two bits off the silver price---and from there it traded flat, but rallied a bit in electronic trading after the Comex had closed.

The high and lows ticks were recorded as $19.84 and $19.455 in the March contract, which was a 2% intraday move.

Silver finished the Monday session at $19.56 spot, down 12.5 cents from Monday.  Volume, net of January and February, was 38,500 contracts.

Platinum and palladium hit their respective highs---such as they were---shortly after 9 a.m. GMT in London.  From there they got sold down a bit into the very early afternoon in New York---and didn't do much after that.  Here are the charts.

The dollar index closed in New York on Monday afternoon at 80.43----and then didn't do much of anything until about 2:40 p.m. Hong Kong time.  The rally from that point topped out at 80.74 shortly after 10 a.m. GMT in London.  By the open of the New York equity markets yesterday, the index was back down to 80.50---and then rallied a bit into the close.  The Index finished the trading day yesterday at 80.67---up 24 basis points.

The gold stocks chopped around unchanged until exactly 10 a.m. EST---and then away they went to the upside.  They faded a bit in mid-afternoon trading, but then rallied strongly into the close, but got sold off a hair right at the close.  The HUI finished up 1.84%---but would have finished up well over 2% if that seller hadn't shown up at the very end.

The silver equities followed a very similar chart pattern---and Nick Laird's Intraday Silver Sentiment Index closed up 2.27%.

The CME's Daily Delivery report showed that 20 gold and 2 silver contracts were posted for delivery within the Comex-approved depositories on Thursday.  JPMorgan issue all 20 gold contracts---and Canada's Bank of Nova Scotia stopped them all---and also picked up the 2 silver contracts.  The link to yesterday's Issuers and Stoppers Report is here.

There were no reported changes in GLD yesterday---and as of 10:01 pm. EST yesterday evening, there were no reported changes in SLV, either.

The good folks over at the Internet site must have read what I said about them in yesterday's column, as they updated their website Tuesday evening with the changes in the short positions in both SLV and GLD.

The changes up until mid-January were in the right direction, as the short positions in both ETFs declined a bit.  In SLV, the short position dropped by 3.46%.  The number of ounces/shares sold short in SLV is still a very chunky 19,490,300---or 606 metric tonnes of the stuff.  In GLD their short position declined by 4.85% ---and is now down to 1.77 million troy ounces, or a bit over 55 metric tonnes.

Because of the nature of these funds, no short positions should be allowed, as every share should be backed by physical metal, but the shorted shares aren't.  If I were an investor, I wouldn't touch either of these ETFs with the proverbial 10-foot cattle prod.  There are many other physical metal funds available that don't allow shorting---and these are the types of funds where I have my money invested.

The U.S. Mint had another sales report yesterday.  They sold 2,000 troy ounces of gold eagles---and 210,000 silver eagles.

There was another 10 metric tonne gold withdrawal from JPMorgan's vault on Monday---321,500.000 troy ounces---so the entire withdrawal was all kilobars once again.  Who was the refiner?  Why was it temporarily held in JPMorgan's vault---and who took delivery?  Questions with no answers.  That was all the in/out action there was in gold---and the link is here.

It was another busy day in silver over at the Comex-approved depositories as well, as 866,936 troy ounces were reported shipped in [most of it into Scotiabank's vault] and 314,952 troy ounces were shipped out.  The link to that action is here.

I have quite a few stories for you again today---and I'm delighted, as always, to leave the final edit up to you.

¤ The Wrap

As was the case in gold, the key question was how many contracts were bought by the technical funds (new longs and covered shorts) on the (initial) price rallies on Thursday and Friday. Of course, the early silver rallies faded badly on both days which suggest there may not have been much net buying by the technical funds in silver as there appears to be in gold. But it is also hard to deny that the price action in silver was putrid which may indicate a determination by JPMorgan to keep silver from advancing no matter what.

Unfortunately, there is no escaping that silver is manipulated in price by JPMorgan and will be until it isn’t any longer. This is a cross silver investors must bear in the short term, much as they have over the years. I would remind you that despite the continuous manipulation by JPMorgan over the past six years, silver prices still managed to climb to almost historic price levels. The conditions that caused silver prices to rise previously (being on the cusp of a physical shortage) are still in place, only sleeping temporarily. - Silver analyst Ted Butler: 25 January 2014

I have nothing to add to what I've already said at the top of this column about Tuesday's price action.  The roll-overs out of the February delivery month---and the results of the FOMC meeting later this afternoon in New York---will dominate price action for a few more days.  What happens after that is anyone's guess.  I know what should happen, but it remains to be seen if it will be allowed to happen.

The gold price is still above its 50-day moving average, but trending lower---and silver has never seriously broached its 50-day moving average to the upside and is now well below it once again.  Here are the six-month charts for both metals.---and give visual confirmation of what Ted spoke of in his quote above.

As you read in the quote posted above, Ted Butler is somewhat concerned that enough technical fund long buying has occurred during the gold rally that began at the very end of December, that it may tempt JPMorgan et al to harvest these new technical fund long holders for fun and profit.  A move like that would certainly take the silver price with it in sympathy, but based on its lousy price action over the last week or so, it would be pretty slim picking for "da boyz" if that was their aim.  But they can do what they want, when they want---and there's not a living, breathing soul that will raise a finger in protest.

Except for a sharp spike down in both gold and silver at the open in New York on Tuesday evening, not much happened price wise in any of the precious metals during the Far East trading day on their Wednesday.  London has just opened while I was typing this paragraph---and nothing much appears to be going on their, either.  Volume in gold is light---and more than three quarters of it is roll-overs out of February into April.  I can't remember the last time that the roll-over activity was this heavy during the Far East trading session, as most of it occurs either in London or New York.  Silver's volume is extremely light---and the dollar index isn't doing a thing.  It appears that all and sundry are awaiting the word from the Fed, along with the price "reaction" in the precious metals---and I'm sure that JPMorgan et al won't leave us in suspense for much more than a few seconds after the "word" is out.

And as I hit the send button on today's efforts, both gold and silver have rallied back to unchanged from their Tuesday closes in New York.  Gross volumes are getting up there in both metals, but net of roll-overs, there is no volume to speak of in gold---and silver volume is still pretty light.  The dollar index is now down about 14 basis points.

That's all I have for today, which is more than enough.

See you tomorrow.

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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