“Happy Thanksgiving” From JP Morgan et al

24 November 2016 — Thursday


The gold price was up a dollar or so about an hour before London opened on their Wednesday morning — and from there developed a slightly negative bias.  It was down about 5 bucks by the COMEX open — and at that point JPMorgan et al pulled the pin.  The low tick came at the same time as it did on Tuesday, around 10:40 a.m. in New York.  The subsequent rally was allowed to last until a few minutes before 1 p.m. EST — and from there, the price chopped quietly lower into the close.

The high and low ticks were recorded by the CME Group as $1,214.70 and $1,181.20 in the December contract.

Gold was closed in New York on Wednesday at $1,187.90 spot, down $24.20 from Tuesday’s close.  Not surprisingly, both gross and net volume were over the moon…with the former checking in at 495,104 contracts — and the latter at 212,000 contracts.  Roll-over/switch volume out of December was monstrous as well.161124gold

Here’s the 5-minute gold tick chart courtesy of Brad Robertson as always — and all you need to look at is the volume activity during the New York session, which starts at 6:20 a.m. Denver time on the chart below.  But in actual fact, the volume that got the ball rolling down the hill in the first place — and the Managed Money traders selling longs and going short — actually started at 1:00 p.m. in London, which was twenty minutes before the COMEX open.  As Ted Butler has said for years, JPMorgan et al set the price lower by selling a bunch of contracts — and only then do the Managed Money traders behave like the Pavlovian pooches that they are.  It’s as clear as day on this chart.  Any other explanation that you hear or read is bulls hit.

The vertical gray line is 10:00 p.m. Denver time, midnight in New York — and 1:00 p.m. China Standard Time [CST] the following afternoon in Shanghai—and don’t forget to add two hours for EST.  The ‘click to enlarge‘ is a must for this chart.161124-5-minute-gold

Silver was up just about a dime by 11 a.m. China Standard Time on their Wednesday morning — and that was its high of the day.  From there it began to crawl quietly lower in price, with the first sell-off coming at, or just before, the noon silver fix in London.  The tiny rally from there got dealt with about thirty minutes before the COMEX open — and you know the rest.  The spike low tick came at 10:15 a.m. in New York — and the rather brisk rally that followed got dealt with about fifteen minutes after the 11 a.m. EST London close.  It chopped quietly higher from there until shortly after the COMEX close — and then sold off equally as quietly into the 5:00 p.m. close of after-hours trading.

The high and low ticks were reported as $16.725 and $16.155 in the December contract. 

Silver closed in New York yesterday at $16.34 spot, down 28 cents.  Net volume was pretty heavy at just over 46,500 contracts, but not anywhere near as heavy as I expected, all things considered, especially compared to gold.  Roll-overs out of December were very decent.161124silver

Here’s the 5-minute silver tick chart from Brad — and it requires no further embellishment from me.  But if you want some, please re-read what I had to say about gold.

Like the 5-minute gold tick chart, the vertical gray line is 10:00 p.m. Denver time, midnight in New York — and 1:00 p.m. China Standard Time [CST] the following afternoon in Shanghai—and don’t forget to add two hours for EST.  The ‘click to enlarge‘ is a must here as well.161124-5-minute-silver

Platinum was forced to follow just about the same price path as silver, except its low tick was set by ‘da boyz’ right at 10:30 a.m…just like they did in gold.  From its low tick, platinum rallied until the COMEX close — and didn’t do a lot after that.  Platinum finished the Wednesday session at $929 spot, down 7 dollars on the day, but 14 bucks off its low tick.161124plati

Ditto for palladium, but it’s low was set around 9:15 a.m. in New York — and it’s subsequent rally got capped and turned lower shortly before 1 p.m. EST, just like the gold price.  Platinum finished the day at $733 spot, down 5 bucks from Tuesday, but 10 bucks off its low.161124plad

It should be noted that once the low ticks for all four precious metals were in yesterday, JPMorgan et al had to stand watch to ensure that they didn’t rally back into positive territory, which is precisely what they would have done if left to their own devices.

The dollar index was closed very late on Tuesday afternoon in New York at 101.01 — and after dipping down to its 100.89 low tick minutes after 3 p.m. Shanghai time on their Wednesday afternoon, it began to chop unsteadily higher from there.  Then a few minutes before 1 p.m. in London — and twenty minutes before the COMEX open, the powers-that-be hit the ‘ramp the dollar index/smash precious metal prices’ button.  The 101.91 high tick came a minute or two before 11 a.m. EST, which was a minute or two before London closed for the day.  By 12:25 p.m. it back down to just above the 101.50 mark — and from there, crawled quietly higher into the close.  The dollar index finished the Wednesday session at 101.68 — up 67 basis points on the day.

I don’t know how more blatantly obvious they can get on a dollar ramp-job like this…except for maybe the engineered decline in precious metal prices that accompanied it.

There are no markets anymore, only interventions.161124intraday-gif

And here’s the 6-month U.S. dollar index which, as you already know, I include mostly for entertainment purposes.161124-6-month-usd

The gold stocks gapped down 5 percent at the open — and after sagging a bit until a few minutes before 11 a.m. in New York, ‘rallied’ back to close down ‘only’ 5.16 percent.161124hui

The silver equities opened down 4 percent and change — and sagged a bit more as the trading day went along, but did not close on their respective lows.  That’s small consolation however, as Nick Lairds’ Intraday Silver Sentiment/Silver 7 Index closed down 6.20 percent.  Click to enlarge if necessary.161124silver-7

It should be noted that even though there were truck loads of precious metal shares sold yesterday, there was obviously someone standing there that was happy to buy them all at these prices.

The CME Daily Delivery Report showed that zero gold and zero silver contracts were posted for delivery within the COMEX-approved depositories on Monday.

The CME Preliminary Report for the Wednesday trading session showed that, much to my surprise, gold open interest in November jumped by another 194 contracts, leaving 221 still open.  Tuesday’s Daily Delivery Report showed that 16 gold contracts were actually posted for delivery on Friday, so that means that 16+194=210 gold contracts were added to the November delivery month.  That’s quite amazing for this late in what is normally a non-delivery month for gold…or silver, for that matter.  Silver o.i. in November remained unchanged at 1 contract still open — and nothing was reported for delivery on Friday in Tuesday’s Daily Delivery Report.

Gold open interest in December fell by a chunky 54,965 contracts, leaving 109,535 still around — and silver o.i. in December dropped by 7,197 contracts, leaving 41,181 still open.

There was another huge withdrawal from GLD yesterday, as an authorized participant, or perhaps more than one, took out 428,994 troy ounces.  I would suspect that this represented a conversion of GLD shares into physical metal by one of Ted’s “big buyers”.  And as of 7:43 p.m. EST yesterday evening, there were no reported changes in SLV.

There was a fairly decent sales report from the U.S. Mint yesterday.  They sold 9,500 troy ounces of gold eagles — 1,500 one-ounce 24K gold buffaloes — and 165,000 silver eagles.

Once again there wasn’t much activity in gold over at the COMEX-approved gold depositories on the U.S. east coast on Tuesday.  Nothing was reported received — and 3,118.550 troy ounces/97 kilobars [U.K./U.S. kilobar weight] were shipped out.  I shan’t bother linking this activity.

There was considerable more action in silver, as 1,213,281 troy ounces were reported received, but only 75,359 troy ounces were shipped out the door.  All the ‘in’ activity was more or less split up evenly with one shipping container full going into Brink’s, Inc. — and another container into CNT.  Of the ‘out’ activity, there was 35,301 troy ounces shipped out of CNT — and the rest came out of Canada’s Scotiabank.  The link to all that action is here.

The activity over at the COMEX-approved gold kilobar depositories in Hong Kong on their Wednesday continues to impress.  There were 1,058 kilobars shipped in — and a chunky 7,503 kilobars shipped out the door for parts unknown.  All that action was at Brink’s, Inc. — and the link to that, in troy ounces, is here.

Here are two charts that Nick Laird passed around late yesterday afternoon Denver time.  They show gold and silver imports into Turkey for October.  They imported 18.201 tonnes of gold, plus 32.718 tonnes of silver.  The Click to Enlarge feature helps for both charts.161124turkey-gold


I don’t have all that many stories for you today, either — and I hope there are a couple that meet with your approval.


Retailers Panic: 63{f02ffe5e8b39fd7974c2720d01ccf381ddc9ebb4164215842085b3c57e4f642e} of Americans Plan Not to Shop on Black Friday

The day after Thanksgiving, also known as Black Friday, is when the holiday shopping season in the United States traditionally begins and is the day when retailers (at least in the past) finally turned a profit, going from “being in the red” to “in the black.” However, in recent years, this trend has seen turned upside down, with sales on Black Friday slipping, as retailers offer pre-Thanksgiving deals ever earlier than in recent years to capture heavily discounted market share (think OPEC) and draw shoppers as “Black Friday” no longer marks the spending peak at brick-and-mortar chains.

According to National Retail Federation data, the number of Thanksgiving weekend shoppers has fallen by nearly a third in just the past three years to 102 million in 2015, from 147 million in 2012, not only as a result of bricks and mortar stores starting the selling season earlier but due to stiff competition form online vendors, most notably Amazon. Moreover, early holiday promotions and online shopping hurt in-store spending by more than 6 percent last year.

As a result, participation in this year’s Black Friday looks like it may be the worst in history: according to a Reuters/Ipsos poll of 1,639 adults showed 63{f02ffe5e8b39fd7974c2720d01ccf381ddc9ebb4164215842085b3c57e4f642e}, or nearly two-thirds, did not plan to shop on Black Friday this year. Some 32{f02ffe5e8b39fd7974c2720d01ccf381ddc9ebb4164215842085b3c57e4f642e} said they plan to finish about half of their holiday shopping on that day. While selling tactics are certainly a factor, one wonders how much of decline in spending is due to lack of disposable income for the tapped out U.S. consumer?

The holiday season is expanding, and Black Friday is no longer the kickoff for the season,” said Natalie Kotlyar, who heads retail and consumer products at business advisory firm BDO Consumer, adding many start holiday shopping at Halloween, Labor Day or even Amazon’s Prime Day on July 12.

Still, retailers are not only not giving up but, as Reuters reports, are on the verge of panic, and have not only redoubled efforts this year to boost sales with familiar tactics but greater intensity, all of which assure even lower margins, but are rolling out the heavy artillery to draw in those consumers who will go out on Friday.

This Zero Hedge story doesn’t quite live up to the hyperbole of the KWN-style headline.  It was posted on their Internet site at 10:55 a.m. on Wednesday morning EST — and I thank reader ‘David in California’ for passing it around.  Another link to it is here.

Doug Casey on Globalism and the Worldwide Populist Revolt

Nick GiambrunoThe inevitable breakdown of the European Union and the massive financial crisis it could trigger is an important theme for us right now.

I’ve just spent weeks with my boots on the ground in Italy. The country has enormous public debt levels, and its banking system is on the verge of collapse.

Italy could trigger the collapse of the entire E.U., which could start an irreversible trend. It’s a sign that globalism—the secular religion of the Deep State—is a failed ideology.

By globalism, I simply mean the centralization of power into global institutions: the EU, the United Nations, the IMF, the World Bank, NAFTA, GATCA, NATO, and so forth. Globalism is really just a polite way of describing world government, or what George H.W. Bush termed the New World Order.

I’m skeptical of government on any level, especially global government.

This back-and-forth commentary between Nick and Doug appeared on the internationalman.com Internet site yesterday — and another link to it is here.

New British Pound Coin Resists Faking

In March Britain’s 30-year-old round pound will be on the way out, its place taken by a new, secure, bimetallic dodecagonal (12-sided) pound.

On Nov. 1 the British Treasury launched a campaign to support retailers and other businesses in preparing for the historic changeover. Among other matters a new website went live providing materials to support these businesses in their preparation for the new coin.

The British Royal Mint considers its new pound coin the most secure coin of its kind in the world. The term “cutting edge” is mentioned in all media releases from Treasury and Mint alike. Certainly the upgrade is urgently needed given the 45 million counterfeit £1 coins currently in circulation.

New security features include micro-lettering and a hologram-like image below the queen’s neck that changes from a “£” symbol to a numbral “1” when the coin is seen from different angles.

The above four paragraphs are all there is to this brief news item that was posted on the numismaticnews.net Internet site on Monday.  I thank Tolling Jennings for pointing it out.

Merkel Declares War on “Fake News” as Europe Brands Russia’s RT, SputnikDangerous Propaganda

Picking up the torch on the most hotly debated topic by the humiliated U.S. mainstream media, namely the spread of so-called “fake news” (not to be confused with Brian Williams lying for years on prime time TV, and which until recently was branded far simply as “conspiracy theory”), German Chancellor Angela Merkel warned on Wednesday against the power of fake news on social media to roil the establishment and to spur the rise of populists, after launching her campaign for a fourth term.

Speaking in parliament for the first time since her announcement Sunday that she would seek re-election next year, Merkel cautioned that public opinion was being “manipulated” on the internet.

Meanwhile, just as Merkel was launching Europe’s war on “fake news”, Europe’s bureaucrats were one step ahead, and in a shocking move, on Wednesday the E.U. Parliament voted on a non-legislative resolution which calls for the EU to “respond to information warfare by Russia.” Russian news websites RT and Sputnik news agency were alleged to be among the most dangerous “tools of Russian propaganda.

A total of 691 lawmakers participated in the vote: 304 voted in favor of the resolution dubbed ‘E.U. strategic communication to counteract propaganda against it by third parties’, 179 voted against and 208 abstained from voting. Authors of the document equate counteracting Russia with the resistance to Daesh terrorist group and call on E.U. member states to boost financing counter-propaganda projects.

Written by a Polish member of the European Conservatives and Reformists (ECR) group, Anna Fotyga, the report alleged that Moscow aims to “incite fear and divide Europe,” and called for the establishment of measures to tackle the perceived Russian propaganda threat. The report suggests that Moscow provides financial support to opposition parties and organizations in E.U. member states, causing disintegration within the bloc.  In other words: to counter alleged Russian propaganda, Europe is unleashing it own, very much formal counter-propaganda.

This longish article put in an appearance on the Zero Hedge website at 12:16 p.m. EST yesterday — and it’s the second offering of the day from ‘David in California’.  Another link to this story is here.

Iran warns of retaliation if U.S. breaches nuclear deal

Extending U.S. sanctions on Iran for 10 years would breach the Iranian nuclear agreement, Iran Supreme Leader Ayatollah Khamenei said on Wednesday, warning that Tehran would retaliate if the sanctions are approved.

The U.S. House of Representatives re-authorized last week the Iran Sanctions Act, or ISA, for 10 years. The law was first adopted in 1996 to punish investments in Iran’s energy industry and deter Iran’s pursuit of nuclear weapons.

The Iran measure will expire at the end of 2016 if it is not renewed. The House bill must still be passed by the Senate and signed by President Barack Obama to become law.

Iran and world powers concluded the nuclear agreement, also known as JCPOA, last year. It imposed curbs on Iran’s nuclear program in return for easing sanctions that have badly hurt its economy.

This Reuters story, filed from Beirut, showed up on their website at 9:11 a.m. on Wednesday morning EST — and it’s from Zero Hedge, courtesy of Brad Robertson.  Another link to it is here.

How will India destroy 20 billion banknotes?

To give some idea of the amount of the currency that represents – there were more than 90 billion banknotes in circulation in India last March.

Most central banks destroy soiled and mutilated banknotes on a regular basis and replace them with new, crisp ones.

The Reserve Bank of India, similarly, shreds such notes and makes briquettes of them. But they are not your usual briquettes.

So the bank’s 27 shredding and briquetting machines in 19 offices across India will now snip the expired banknotes into the smallest of pieces and the resulting briquettes will be then dumped in India’s vast landfills.

Central bank officials believe shredding 20 billion banknotes will not be a huge challenge. In 2015-16 the Reserve Bank of India destroyed more than 16 billion soiled notes. More than 14 billion were removed in 2012-2013 after nearly 500,000 fake notes were found in the system.

Destroying so much cash is not a challenge because we have enough shredding and briquetting machines with very high capacities. These are automatic machines which shred the cash into the finest of pieces,” says an official. So, India’s mountain of expired currency will soon become rubbish, literally.

This brief news item was posted on the bbc.com Internet site yesterday sometime — and I thank Swedish reader Patrik Ekdahl for sharing it with us.  Another link to this story is here.

Devalue yuan before Trump takes over, Chinese government adviser says

An influential Chinese government adviser says Beijing should stop intervening to control the value of the yuan and instead allow a fall in the currency’s exchange rate before Donald Trump takes office as U.S. president at the end of January.

Yu Yongding, a senior fellow at the Chinese Academy of Social Sciences, wrote in a co-authored article published in the Shanghai Securities News that the Chinese currency was likely to depreciate against the dollar in the coming months and Beijing should permit the yuan to fall as much as the markets dictate while maintaining controls on the flow of capital in and out of the country.

Yu, who was the only academic on the central bank’s monetary policy committee when China removed the yuan’s peg to the value of the dollar in 2005, said in the article: “Over the next few months, the possible increase of returns on dollar assets … and capital outflows will bring in bigger depreciation pressure on yuan.

From now until the president-elect Donald Trump officially takes office is a good period to abandon market intervention and let the yuan fully release its depreciation pressure.

A quick devaluation of the yuan by any significant amount would rock the international financial markets.  But it is coming, it’s just a matter of when — by how much — and over what time period.  This news item appeared on the South China Morning Post yesterday — and it’s something I found embedded in a GATA release.  Another link to it is here — and it’s worth reading.

Paper gold is the elephant in the room: An Interview with GATA secretary/treasurer Chris Powell

Many people seek gold as a safeguard against inflation of fiat currencies, but they often forget how fiat currencies came to be in the first place.

This blind spot has permitted the very same deceit to play out in our time — but without detection in the major financial press.

The blind spot is fractional reserves. It is the holding of precious metals — the hard money — below the number of claims of customers. It was the precursor to modern fiat currencies, which now only have shadow “reserves” of more cash. Similarly, conventional banks now hold cash as “reserves” for checkbook and digital money.

Who is the dummy in this situation? As Chris Powell of the Gold Anti-Trust Action Committee says, “If you don’t know who … you’re the dummy.”

Powell, an editor and journalist by trade, began GATA in 1999 and spoke at this year’s New Orleans Investment Conference. He is also a longtime Gold Newsletter subscriber, and we sat down with him to get a better sense for the prevalence of fractional reserves. He laid waste to the corruption of central banks and to cowardly members of his profession when it comes to reporting on manipulation of the gold market.

This 13:12 minute audio interview was posted on the goldnewsletter.com Internet site on Monday — and a transcript, plus the link, can be found in this GATA release from yesterday.  Another link to all of this is here.

Masked men rob HK$20 million in gold bars in Hong Kong

Three masked men robbed 81 gold bricks worth HK$22.68 million (US$2.92 million) in 20 seconds in Fanling, the New Territories in Hong Kong on Tuesday morning, which is the biggest gold heist for six years in the city.

Hong Kong police said they are hunting for the three men who made the actual robbery and two drivers who helped them with two vehicles. But no arrests had been made.

According to the police, the victim was a 33-year-old who had been hired a few months ago by a company to deliver the gold. At about 9 a.m., he was unloading three bags of gold bars from his delivery van onto a trolley outside Heraeus Technology Center in On Chuen Street, for the gold bars to be taken to a nearby workshop to be melted and turned into ornaments. He was supposed to deliver 258 gold bullion bars in total, worth over HK$70 million.

This news item was posted on the china.org.cn Internet site yesterday sometime — and I thank Ellen Hoyt for bringing it to our attention.  Another link to it is here.

Hugo Salinas Price: How much gold is there in India? [Enough to support a gold standard]

Hugo Salinas Price, president of the Mexican Civic Association for Silver, writes that India may be most ready of all nations for a gold standard currency system, since so much gold is in the hands of the people rather than the government. Indeed, GATA’s objective long has been to get central banks out of the gold business, even as they conceal their interventions in the gold market and other markets.

Salinas Price’s commentary is headlined “How Much Gold Is There in India?” and it was posted at the association’s internet site, plata.com.mx on Wednesday.  I found this story on the gata.org Internet site — and I thank Chris Powell for writing the above paragraph of introduction.  Another link to this article is here.

Record Run into Gold and Silver Coming — David Morgan

Precious metals expert David Morgan says trillions of dollars of negative interest rate paying bonds is a sign we are getting close to another financial calamity bigger than the last. Morgan explains, “Now, as everyone knows, we are even at negative interest rates, and people are buying into this.  They are guaranteed to get less back. . . . This is the upside-down world we are living in.  This is the science fiction planet that is our reality.  So, this is the reason you will see a run to the dollar before you see a run to gold.

We are in the final step before another 1{f02ffe5e8b39fd7974c2720d01ccf381ddc9ebb4164215842085b3c57e4f642e} of the population takes action into the precious metals.  When the run starts, it won’t be because 90{f02ffe5e8b39fd7974c2720d01ccf381ddc9ebb4164215842085b3c57e4f642e} of the population wakes up and says I need precious metals to protect my financial well being.  What will happen is another 1{f02ffe5e8b39fd7974c2720d01ccf381ddc9ebb4164215842085b3c57e4f642e} will wake up and say I need precious metals to protect my financial well being.  That will double the market.  The physical gold market is less than 1{f02ffe5e8b39fd7974c2720d01ccf381ddc9ebb4164215842085b3c57e4f642e} of all financial assets, and the silver market is about 0.02{f02ffe5e8b39fd7974c2720d01ccf381ddc9ebb4164215842085b3c57e4f642e} of all financial assets.

So, it doesn’t take a big amount of new money to put the paper price at stratospheric levels, and that’s what will take place.  When people don’t trust the dollar they are holding in their hands, when that happens, there will be a run into gold that will be in the financial record books.

This 32:43 minute video interview with David Morgan by Greg Hunter was posted on the usawatchdog.com Internet site on Tuesday — and another link to it is here.

Trump’s Victory: What Does it Mean for Gold? — John Hathaway

“Trumpmania” has had the opposite effect on gold. After rising during the night of the election to $1,340 on the initial fears of a Trump victory, the morning-after “discovery” of the “moderate and statesmanlike Trump,” somehow revealed only after the campaign, resulted in a fall of $70 intraday, after which the metal settled at the end of the week at $1227, a peak-to-trough move of 8.4{f02ffe5e8b39fd7974c2720d01ccf381ddc9ebb4164215842085b3c57e4f642e}.

What seems more incredible, record COMEX volume during the reversal amounted to two million contracts, or 6,200 tons, which is the equivalent of two years of global mine production. This fact alone, in our opinion, highlights the absurd disconnect between synthetic paper instruments and the real assets they represent. What one can say with absolute certainty is that relatively little physical gold changed hands to explain this price swing. While the gold ETF (GLD) did shed approximately 600,000 ounces during the week (17 tonnes), this is a far cry from the 6,200 tonnes of synthetic that was dumped. In our opinion, the selling was driven almost entirely by panicky ultra-long speculative investors who were wrong-footed by the morning-after reaction to the Trump victory, and who were then unceremoniously cleaned out by commercial traders who staged an opportunistic short-selling raid.

We have observed on repeated occasions that purely speculative paper transactions distort the price of real-world physical goods. In our view, price-disruptive distortions of this sort (including commodities other than gold) are enabled and encouraged by the willingness of the Chicago Mercantile Exchange (CME) to promote high-frequency trading to build profitability.

Well, dear reader, John is sounding a lot like Ted Butler these days — and why shouldn’t he?  John knows full well what’s going on, as Ted has been writing chapter and verse about it for decades already.  This commentary appeared on his website just yesterday, even though it’s dated 17 November.  I check the tocqueville.com Internet site every day before I start my column — and it wasn’t there on Tuesday.  The copy I did get, arrived in my in-box yesterday morning from John Hathaway himself.  It’s a must read for sure — and another link to it is here.

The PHOTOS and the FUNNIES161124photo-1



The only, and I must empathize, the only reason for [yesterday’s] price smash was to allow the commercials to buy as many COMEX gold and silver contracts as possible. It was a COMEX price rig job as clear as any have been before it — and must be recognized as such. — Silver analyst Ted Butler: 23 November 2016

I know that I shouldn’t have to repeat the obvious by using Ted Butler’s quote from his mid-week column yesterday, but I’ve already read several stories on the Internet by so-called precious metal ‘analysts’ that don’t recognize this engineered price decline for what it was.

With options and futures expiry in progress, it was another reason for JPMorgan et al to smash prices so that most of these gold and silver derivatives closed out of the money — and the bullion banks were able to keep all the premiums for themselves.

Here are the 6-month charts for all four precious metals, plus copper — and that chart is certainly worth a look as well, as ‘da boyz’ obviously weren’t ringing the cash register in that metal.161124-6-month-gold


And as I type this paragraph, the London open is less than ten minutes away — and I note that after getting sold down a couple of bucks in the first two hours of trading after New York opened yesterday evening, the gold price traded flat, but got tapped lower about twenty minutes before the London open — and is down $4.10 the ounce at the moment — and closing in on yesterday’s low price tick.  Silver was down about 15 cents by around 9:20 a.m. China Standard Time on their Thursday morning.  It rallied back a dime by 1 p.m. CST — and then rallied back to unchanged by twenty minutes before the London open, but the short buyers of last resort showed up — and silver is down 5 cents currently.  Platinum was under pressure throughout most of the Far East trading session — and is almost back to its low tick from Wednesday as well — and is down 13 dollars at the moment.  Palladium followed a similar path to silver — and was up 2 bucks until ‘da boyz’ showed up twenty minutes before the London open — and it’s down 4 bucks now.

Net HFT gold volume is just over 32,000 contracts, with decent roll-over/switch volume — and that number in silver is just under 8,000 contracts, with very decent roll-over volume out of December as well.

The dollar index began to chop unsteadily higher as soon as trading began at 6:00 p.m. EST in New York yesterday evening, but really took off when ‘da boyz’ hit the ‘ramp the U.S. dollar index/smack the precious metals’ button around 3:40 p.m. in Shanghai, which was twenty minutes before the London open.  The index is currently up 24 basis points.

So, did the Managed Money traders pile onto the short side yesterday, after sitting things out during the last reporting week?  Beats the hell out of me, but I would certainly think that was the case.  However, because yesterday’s price action occurred the day after the cut-off for this Monday’s Commitment of Traders Report — which was deliberate, I’m sure — we won’t have a clue until we see the COT Report on Friday, December 2.  That’s a lifetime away at the moment.

Just looking at the raw volume data from Wednesday’s Preliminary Report, it shows that December gold open interest dropped by 34,124 contracts in total, but that number in silver showed a decline of only 1,190 contracts.  It’s hazardous to one’s health to take these numbers as ‘The Gospel’ — but I find the huge difference intriguing.  The final numbers probably won’t be posted later today because of the Thanksgiving holiday in the U.S., so we’ll have to wait until Friday morning before they show up on the CME’s website.

But without doubt, the internal market structure in COMEX futures in both silver and gold has improved substantially after yesterday’s price action, as JPMorgan et al were buying longs and covering short positions like mad, as the Managed Money traders sold what was left of their long positions — and probably went short as well.  The vicious spike down had all the hallmarks of a capitulation move to the down side, but only the powers-that-be know that for sure, so I reserve the right to be wrong about that.

And as I post today’s column on the website at 4:05 a.m. EST, I see that ‘da boyz’ set a new low tick in gold for this move down, so it’s obvious that we haven’t seen the bottom in any of the precious metals yet.  Gold has rallied off its new low by a bit — and is down $2.30 at the moment.  The silver price hasn’t done much in the first hour of London trading — and is down 3 cents.  JPMorgan et al set a new low tick for this move down in platinum as well — and it’s currently down 14 dollars the ounce. Palladium has rallied off its current low — and is now up a buck on the day.

Net HFT gold volume is up to just under 43,000 contracts, not a surprisingly high number considering that a new low was just set.  Roll-over activity is nothing special.  That number in silver is just over 9,100 contracts — and that number has changed much in the last hour, but certainly will if ‘da boyz’ blast out a new low sometime during the rest of the Thursday trading session.

The dollar index sold off pretty hard starting minutes after the London open — and is only up 6 basis points currently.

With New York supposedly closed today, I’m not sure what to expect as far as price action is concerned.  The new low tick in gold [and platinum] came as a bit of a surprise…so if they can do that in the first hour of London/Zurich trading, it means they can inflict further downside pain if they so choose as the trading day goes along.

And they might.

That’s all I have for today — and I’ll see you here tomorrow.



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