Another down day for the precious metal equities. No change in GLD, but a huge deposit into SLV. A small sales report from the U.S. Mint---and decent movement in both gold and silver at the Comex-approved depositories on Friday.
NEW YORK ( TheStreet) -- The gold price got sold down the moment that trading began in New York on Sunday evening. The HFT boyz took the price down to its low tick of the day shortly after 2 p.m. Hong Kong time---a new low for this move down---and the rally that began at that point got capped at the London p.m. gold fix. From there it got sold down until 2 p.m. EDT in electronic trading---and it didn't do much after that. The high and lows ticks were reported by the CME Group as $1,251.00 and $1,241.10 in the August contract. Gold finished the Monday session at $1,243.50 spot, down another $7.80 from Friday's close. Volume, net of June and July, was pretty light at only 90,000 contracts. The silver price action was very similar to gold's, so I shall spare you the details---except to note that silver also touched a new low price for this move down as well. The high and low for silver were recorded as $18.87 and $18.65 in the July contract. Silver closed in New York yesterday at $18.76 spot, down 5 cents from Friday. Net volume was also pretty light at only 22,500 contracts. Platinum and palladium weren't spared, either---and both closed down on the day as well. Platinum by seventeen bucks---and palladium by 7 dollars. Here are the charts. The dollar index closed at 80.38 on Friday in New York---and chopped quietly higher throughout the entire Monday trading session, finishing the day at 80.63---up 25 basis points on the day. The gold stocks opened down a bit, but rallied back into positive territory on the rally going into the London p.m. gold fix. Once the gold price got capped, the stocks sold off as well, hitting their lows of the day at 2 p.m.---the moment that the gold price stopped falling. From there they rallied quietly in the close---and finished down 0.60%. The price path of the silver equities was almost the same as the gold stocks, except for the fact that Nick Laird's Intraday Silver Sentiment Index closed down 1.04%. The CME Daily Delivery Report for Day 3 of the June delivery month in gold showed that 7 gold and 81 silver contracts were posted for delivery within the Comex-approved depositories on Wednesday. So far this month, only 99 gold contracts have been posted for delivery. I don't know what to make of that---and I forgot to ask Ted Butler about it when I spoke to him on the phone yesterday. In silver, the largest short/issuer was Jefferies once again with 70 contracts---and the three largest long/stoppers were JPMorgan, Scotiabank and Barclays. The link to yesterday's Issuers and Stoppers Report is here. There were no reported changes in GLD yesterday---and as of 7:31 p.m. EDT yesterday evening, there were no reported changes in SLV, either. But when I checked the iShares.com Internet site at 3:02 a.m. EDT this morning, much to my surprise, there had been a very chunky deposit of 2,401,285 troy ounces reported. One can safely assume, based on the recent price action, that this was deposited to cover an existing short position. The U.S. Mint had a smallish sales report yesterday. They sold 4,500 troy ounces of gold eagles---1,000 one-ounce 24K gold buffaloes---100 platinum eagles---and zero silver eagles. In gold over at the Comex-approved depositories on Friday, they reported receiving 32,147 troy ounces---all of which went into the warehouse over at HSBC USA. In silver, there was 601,134 troy ounces reported received---and 62,199 troy ounces reported shipped out. The big receipt went into Brink's, Inc. Here are a couple of charts courtesy of Nick Laird. They are the intraday price movement for both gold and silver during the month of May. As you tell, the charts are very similar, with the major inflection points in both coming at the 8 a.m. London open, the London noon silver fix---and the 1:30 p.m. EDT Comex close. I have a decent number of stories for you today---and the final edit is yours.
¤ The Wrap
What should be seen as being beyond doubt is that COMEX positioning is the price driver in silver and gold. Nothing else even comes close. We went down in price this past week and on every previous price sell-off because the technical funds got snookered into selling on price signals rigged by the commercials. We will go up when the technical funds have sold all they can sell and then begin to buy. No one knows the day of the price turn up in advance, but it will come---and should most likely come soon, given the extreme COT readings, particularly in silver. - Silver analyst Ted Butler: 31 May 2014 It was a low volume, nothing sort of day in both gold and silver on Monday. Low volume or not, one shouldn't overlook the fact that a new low price tick for this move down was set in both metals during the Hong Kong afternoon trading session---and the price of both got sold down once the London p.m. gold "fix" was in. Here are the 6-month charts for both gold and silver so you can see the "slicing of the salami" to the downside that's been going on day after day. In Tuesday trading in the Far East, not much happened price-wise in either gold or silver up until 1 p.m. Hong Kong time. Then both popped a bit, however it remains to be seen if this develops into anything as the trading progresses in London and New York. And as I write this paragraph, the London open is five minutes away---and volumes in both metals are on the lighter side. The dollar index is basically flat. Today, at the 1:30 p.m. Comex close, is the cut-off for this Friday's Commitment of Traders Report. Providing nothing untoward happens to the upside in price during Tuesday trading, it's a given that the numbers in the COT Report will be another one for the record books, particularly in silver. And as I hit the send button on today's column an hour after the London open, all four precious metals are in the plus column. Gold and silver volumes are up some more, but not by alarming amounts---and the dollar index is down a handful of basis points. I'm off to bed early, as I have a plane to catch later this morning---and I'll see you here tomorrow.