A down day for the precious metal equities. Another withdrawal from GLD---and no change in SLV. No sales report from the U.S. Mint, but Canada's Royal Canadian Mint had a sales report. No in/out activity in gold at the COMEX-approved depositories on Tuesday---and 100,000 ounces of silver shipped out.
NEW YORK ( TheStreet) -- Not unexpectedly, it was a 'nothing' sort of trading day as the December contract went off the board---and the gold price was kept safely confined under $1,200 spot---and it's current 50-day moving average, which is just over the $1,205 mark at the moment. The high and low ticks aren't worth the effort to look up. Gold finished the Wednesday session at $1,198.00 spot, down $3.20 from Tuesday's close. Volume, net of roll-over activity was pretty decent at around 133,000 contracts, with the lion's share of that in the new front month which is February. Gross volume was 208,000 contracts. Silver traded in a 20 cent range all day long. There was a 1 percent rally between the Comex open and the London p.m. gold fix, but that 'gain' disappeared by the 5:15 p.m. close of electronic trading. Once again the highs and lows aren't worth the time to look up. Silver finished the Wednesday trading session in New York at $16.54 spot, down 12.5 cents from Tuesday. Net volume was decent as well at 37,500 contracts. The platinum price traded very flat for all of the Wednesday trading session, but did manage to finish up four dollars on the day. Palladium had a bit of a roller coaster ride---and manged to break above the $800 spot price mark a couple of times, closing right on the $800 spot mark, up ten bucks on the day. Here are the charts. The dollar index closed at 87.89 late on Tuesday afternoon in New York. From there it didn't do much until a smallish rally materialized around 8:35 a.m. GMT in London. The 88.03 high tick came around 10:20 a.m. in London---and then sold off to its 87.53 low tick minutes before 11 a.m. in New York. From there it rallied handful of basis points into the close, finishing the Wednesday session at 87.68---down 21 basis points from Tuesday. The chart pattern on Wednesday was almost a carbon copy of the chart pattern on Tuesday---and Monday. Here's the 3-day dollar index chart so you can see for yourself. The gold stocks opened down---and hit their low tick around 12:40 a.m. EST. They rallied until 3:40---and from there got sold down into the close. The HUI finished lower by 1.53%. The silver equities followed an identical path, as Nick Laird's Intraday Silver Sentiment Index closed down 2.44%. The CME Daily Delivery Report showed that 3 silver contracts were posted for delivery within the COMEX-approved depositories on Friday. These are brand new last-minute deliveries, as they didn't appear in yesterday's Preliminary Report from the CME, as the remaining deliveries for November were posted yesterday---and will be delivered on Friday as well. The CME Preliminary Report for the Wednesday trading session showed that there's nothing left to deliver in the November contract, as everything has already been posted in the above Daily Delivery Report. December o.i. in gold is way up there at 11,524 contracts---and silver's December open interest is 3,966 contracts. Without doubt, these numbers will be revised considerably lower when this report is updated to its 'Final' version mid-morning EST on Friday. First Day Notice numbers for 'Day 1' of the December delivery month will be posted on the CME's website on Friday evening EST sometime. There was a withdrawal from GLD yesterday, as an authorized participant took out 67,265 troy ounces. And as of 9:43 p.m. EST yesterday evening, there were no reported changes in SLV. There was no sales report from the U.S. Mint. Here in Canada, the Royal Canadian Mint finally got around to posting its third quarter financial statements---and here is what they had to say about bullion sales for the July/September period on page 6 of that report. " The volume of Gold Maple Leaf (GML) sales declined 29.7% to 137,000 ounces compared to 195,000 ounces in the same period in 2013. Sales of Silver Maple Leaf (SML) coins declined 19.4% to 5.4 million ounces from 6.7 million ounces in the same period last year." " As in the second quarter of fiscal 2014, the decline in GML demand during July and August reflected the shift in investor sentiment as global economies appeared to be recovering. This reversed in early September with sombre economic news coming from Europe and China, and as geopolitical tensions in the Middle East caused the price of oil to drop." It's a slam dunk that what happened to silver maple leaf sales in July and August is exactly what happened to silver eagles sales in the U.S. during the same time period. "Mr. Big" buyer---Ted thinks JPMorgan---knew that silver prices were about to head lower [because they engineered it] so they stepped away from the table, only to return when deed had been done, saving millions for themselves---and screwing the RCM for the same amount. [Jamie Dimon's daughter would be so proud! See the Critical Reads section for that story.] Note in the second paragraph that the key words are " This reversed in early September… " and it's an excellent bet that JPMorgan had returned to the table and bought every SML that the mint hadn't sold up to that point. Using silver eagles sales in the U.S. in the third quarter-to-date as a proxy for third quarter SML sales, it's safe to say that the RCM will have an excellent fourth quarter for silver maple leaf sales---and close to another record year. However, if that is the case, we won't know about it until the mint files its year-end report, probably at the end of February, if not later. There was no in/out activity in gold at the COMEX-approved depositories on Tuesday. There was a bit of activity in silver, as 100,124 troy ounces were shipped out---and nothing was received. The link to that action is here. I have the usual number of stories for a mid-week column---and there is one absolute must read in here as well.
¤ The Wrap
There was a sharp increase in the short positions of SLV and GLD as of November 14, following a number of recent declines in the short positions. The short position in SLV expanded by 2.6 million shares to nearly 17.5 million shares (oz).You may recall that both silver and gold staged impressive and high volume reversals upward on Friday, November 14. On that day, the volume in SLV was the highest in months and it would be expected that there was net investor buying which would have necessitated a hefty deposit of metal into the trust. There was a 2.4 million oz deposit some days later, but it still felt to me that more metal was “owed” to the trust. The only other alternative was that many shares were sold short on Nov 14 because the metal wasn’t available for deposit. The difference this time is that I don’t think it was JPMorgan doing the shorting in SLV, since relevant COT data covering the same period shows JPM as a buyer. If I’m correct, this increase in shorting in SLV is constructive since it doesn’t appear to be connected to the big shorts. - Silver analyst Ted Butler: 26 November 2014 I wasn't expecting much in the way of price action yesterday---and that's more or less what we got. Volume was pretty high, as the last of the traders rolled out of the December contract, although there might be some spill-over today from overseas markets---and we await First Notice Day tomorrow. With the exception of palladium, the precious metals are all below their respective 50-day moving averages---and in the case of both silver and gold, just below them. Copper set a new intraday low price tick yesterday for this move down, but did not close there. West Texas Intermediate painted a double bottom---and it will be interesting to see what happens with the price after the OPEC meeting today. Here are the 6-month charts for the 'Big 6' commodities. And as I write this paragraph, the London open is about ten minutes away. I was expecting the precious metals to trade quietly in the Far East on their Thursday, as the U.S. was closed today, but that certainly hasn't been the case. So far, gold has an down/up/down intraday move of a percent---and a similar move in silver is closer to 3 percent. The same moves are apparent in platinum and palladium---particularly palladium. Gold volume, net of December, is already an astounding 47,000 contracts---and net open interest in silver is just over 8,000 contracts. The dollar index is down about 10 basis points---and it's price movements during the Far East trading session up to this point have been irrelevant. It beats the hell out of me as to what might be going on under the hood at the moment---so we'll just have to await further developments. Ted Butler informed me that there won't be a Commitment of Traders Report tomorrow, so I won't have that to talk about in my Saturday column. It comes out on Monday. And as I fire this out the door at 5:50 a.m. EST this morning, I note that things have settled down quite a bit. The current lows in all four precious metals came about 12:45 p.m. Hong Kong time---and their subsequent rallies ended about 3 p.m. before getting rolled over. There was no price action around the 10:30 GMT London a.m. gold fix---and the metals aren't doing much at the moment, although they're still all down from Wednesday's closes in New York. Net gold volume is now north of 55,000 contracts---and silver's net volume is just under the 10,000 contract mark. At the moment, gold is down ten bucks, silver's down almost two bits---platinum is down ten dollars as well---but palladium is back to within 3 bucks of yesterday's New York close. The dollar index, which had been down to 87.53 around 3:15 p.m. Hong Kong time, has rallied sharply---and was up a bit over 30 basis points off that low, to 87.86 minutes after 9 a.m. GMT---and hasn't done much since. It's currently up 15 basis points. I must admit that I'm not sure what to make of the price action in Far East trading. Maybe it was 'da boyz' last swing for the fences, as this is the last trading day of the week---and the month. Then again, maybe its nothing. With New York closed, I can't imagine there will be big price activity after London trading ends today, but I'm not about to presume anything at this point. Happy Thanksgiving to all my American readers once again---and I'll see you here tomorrow.