Silver Closed Below $17 Spot Again

10 November 2017 — Friday

YESTERDAY in GOLD, SILVER, PLATINUM and PALLADIUM


The gold price chopped sideways until shortly before 1 p.m. China Standard Time on their Thursday morning — and was up a couple of dollars by around 1:30 p.m. over there.  The price traded sideways until the 10:30 a.m. GMT morning gold fix in London — and began to head higher from there.  The London high came about thirty minutes after the noon silver fix — and it was sold quietly lower until precisely 11:00 a.m. EST, which coincided with the London close.  From that juncture it chopped equally quietly higher — and the high tick of the day, such as it was, came a minute or so after 3 p.m. in the after-hours market.  Those gains weren’t allowed to last — and it was sold lower until trading ended at 5:00 p.m. in New York.

The low and high ticks definitely aren’t worth looking up.

Gold was closed in New York at $1,284.50 spot, up only $3.70 on the day.  Net volume was well over the moon at something under 350,000 contracts.  Gross volume was an eye-watering 423,169 contracts, so there was obviously pretty decent roll-over/switch volume out of December.

The silver price jumped back above $17 spot the moment that trading began at 6:00 p.m. EST in New York on Wednesday evening.  However, it was allowed to get over that price by much, or even break above its 50 or 200-day moving averages.  It was slammed lower in seconds just before the equity markets opened in New York — and it chopped quietly higher from there until it touched the $17 spot mark at 3 p.m. in after-hours trading — and, like gold, was sold lower into the close from there.

The high and low ticks are barely worth looking up, but because of that big 9:30 a.m. EST price spike lower, courtesy of JPMorgan et al, here they are.  The high and lows were recorded by the CME Group as $17.145 and $16.91 in the December contract.

Silver finished the Thursday session at $16.945 spot, down 4.5 cents from Wednesday’s close.  Net volume was very decent at just under 79,000 contracts — and roll-over/switch volume out of December was pretty heavy as well.

The price pattern in platinum was similar to gold’s in many respects — and it closed at $936 spot, up 6 bucks on the day.

Palladium traded pretty flat until Zurich opened on their Thursday morning — and at that point it began to edge higher until it ran into a price ceiling at the $1,018 spot mark just minutes after 12 o’clock noon Central European Time.  About ninety minutes later some kind soul[s] came along and leaned on the price, taking it back to the $998 spot mark by the 1 p.m. in New York.  It quickly rallied back above $1,000 spot — and traded pretty flat from the COMEX close onwards.  Palladium finished the Thursday session at $1,003 spot — and down 6 dollars from Thursday.  Heaven only know what its closing price would have been if it had been allowed to trade freely yesterday.

The dollar index closed very late on Wednesday afternoon in New York at 94.88 — and took another run at the 95.00 mark the moment that trading began at 6:00 p.m. EST that evening.  It made it up to the 94.96 mark just minutes after 9:30 a.m. China Standard Time on their Thursday morning — and that proved to be its high tick of the day.  It headed lower from there in a very wide range, with the 94.42 low tick being set just after 12:45 p.m. in New York.  The index finished the Thursday session at 94.53 — and down 35 basis points from its close on Wednesday.

And you should carefully note that the dollar index was in precipitous decline starting at 9:30 a.m. in New York when the equity markets opened — and that was the precise time the silver got smacked back below the $17 spot mark.

And here’s the 6-month U.S. dollar index chart — and I would suspect that its attempt to break above the 95.00 mark are pretty much done, at least for a few days or so.

The gold stocks certainly didn’t do too much yesterday.  They chopped around unchanged by a small amount until around 12:45 p.m. in New York, which was the low for the dollar index — and the high tick for gold during the COMEX trading session.  And as gold dropped by a few dollars, the stocks slowly sank back into negative territory — and barely moved higher when gold hit its high tick for the Thursday trading session around 3:30 p.m. EST.  The HUI closed down 0.32 percent.

Not surprisingly, the silver equities gapped down at the open on the engineered price decline in the underlying metal that began just minutes before the equity markets opened in New York yesterday morning.  They then chopped sideways until a few minutes after 1 p.m. EST, when the silver price was turned lower, as the dollar index ‘rallied’.  They then slowly sank to their respective low ticks of the day, which came a minute or so before 3 p.m.  They rallied a bit from there into the close.

Along with the above mentioned engineered price decline in silver, the other bad news was that two more companies that make up Nick Laird’s Silver Sentiment/Silver 7 Index turned in less-than-stellar earnings reports — and both got punished by the market.  The two companies in question were Hecla and Pan American Silver.  On Wednesday it was Silver Standard Resources.  Nick’s Silver Sentiment/Silver 7 Index closed down a chunky 3.07 percent.  Click to enlarge if necessary.

And here’s the 1-year Silver Sentiment/Silver 7 Index.  Click to enlarge.

But even though every silver mining company executive out there knows with absolute certainty that the price of their primary product is firmly under the control of JPMorgan et al, don’t expect them to do anything about it.  If they did, it would be great for both their companies — and their stockholders — and except for the odd CEO, they don’t care about either.  I wouldn’t either, if I was ‘earning’ the kind of salaries their respective boards of directors were handing out.


The CME Daily Delivery Report showed that 14 gold and 2 silver contracts were posted for delivery within the COMEX-approved depositories on Monday.  In gold, JPMorgan issued all 14 contracts out of its client account.  There were five long/stoppers in total — and JPMorgan was the biggest with 7 for its client account.  Scotiabank picked up 3 contracts.  The action in silver is not worth commenting on.  The link to yesterday’s Issuers and Stoppers Report is here.

The CME Preliminary Report for the Thursday trading session showed that gold open interest in November rose by 2 contracts, leaving 79 still around, minus the 14 mentioned just above.  Wednesday’s Daily Delivery Report showed that 2 gold contracts were actually posted for delivery today, so that means that 2+2=4 more silver contracts were added to November.  Silver o.i. in November declined by 3 contracts, leaving 4 left, minus the 2 contracts mentioned in the previous paragraph.  Wednesday’s Daily Delivery Report showed that 5 silver contracts were posted for delivery today, so that means that another 5-3=2 silver contracts were added to the November delivery month.


There were no reported changes in either GLD or SLV yesterday.

Late yesterday evening I noted that the folks over at the shortsqueeze.com Internet site updated their data with the short positions in both SLV and GLD as of the close of business on October 31 — and this is what they had to report.  The short position in SLV increased from 14,836,900 shares/troy ounces, up to 15,595,400 shares/troy ounces, which translates into an increase of 5.1 percent.  There was a small decline in the short position of GLD, as it went from 1,096,020 troy ounces, down to 1,061,470 troy ounces, a drop of 3.3 percent.

There was no sales report from the U.S. Mint.

Their was no gold reported received over at the COMEX-approved depositories on the U.S. east coast on Wednesday.  All the ‘out’ activity was at JPMorgan, as 49,312 troy ounces were shipped out.  Also at JPM there was 16,735 troy ounces transferred from the Registered category — and back into Eligible.  The link to that activity is here.

There was a bit of activity in silver.  There was 204,983 troy ounces received at Canada’s Scotiabank — and 12,973 troy ounces was shipped out of Delaware.  The link to that is here.

It was pretty quiet over at the COMEX-approved gold kilobar depositories in Hong Kong on their Wednesday.  They received only 300 of them — and shipped out 665.  All of that activity was at Brink’s, Inc. — and the link to that is here.

I have a fairly decent number of stories today — and I’ll leave the final edit up to you.


CRITICAL READS

The cost of war for the U.S. taxpayer since 9/11 is actually three times the Pentagon’s estimate

The United States military has spent more than $5.6 trillion on conflicts since 2001, more than three times the Pentagon’s actual estimate, according to a new study.

The Department of Defense reported earlier this year that it had spent around $1.5 trillion on conflicts, including putting troops on the ground in Iraq and Afghanistan, air raids in Syria and Iraq to battle the Islamic State militant group (ISIS) and a drone campaign and raids against extremists in Pakistan.

But that figure appears to underplay the real cost of war for the American taxpayer, at least according to the Watson Institute of International and Public Affairs at Brown University. It puts the total cost at $5.6 trillion, or $23,000 per taxpayer.

The study examines not only the money spent by the Pentagon but also the State Department, the Department of Veterans Affairs and the Department of Homeland Security, for resources dedicated to the “war on terrorism.”

The total costs include financial support for allies in the battle against extremist groups, mostly from eastern Europe, such as Croatia, Georgia, Hungary, Poland, and Romania, and a trillion dollars added for the care of veterans who may have received injuries in the conflicts.

This article appeared on the newsweek.com Internet site at 1:09 p.m. EST on Wednesday afternoon — and it was in a Paul Craig Roberts piece that Brad Robertson sent our way.  Another link to it is here.


In Trust’s We Trust — Dennis Miller

My wife, Jo, handed me the phone. “It’s Mary Ann (our stockbroker). She wants to talk about the farm”. I recently wrote about how lucky we were to work with Mary Ann. She was a stockbroker with years of experience and put it to good use.

The farm has been in Jo’s family for over a century. Rightfully, Jo’s portion should be inherited by her daughter, Holly. Mary Ann said we need to call an attorney and set up a trust.

I pushed back, “Trusts are for rich people, we both have wills; that should be enough!” Mary Ann was emphatic, “No it’s NOT!” She started asking me questions I couldn’t answer. Reluctantly, I agreed to call my attorney. Mary Ann was right – we needed more protection. Thirty years later, the trust is still in force.

We’ve seen two situations where a couple was married for many years and the wife passed away. The husband soon remarried – and a few years later, he passed away. His second wife inherited everything. I believe a husband should take care of his spouse – children should wait their turn.

This very interesting commentary by Dennis appeared on his website yesterday morning — and another link to it is here.


Venezuela’s PDVSA misses debt payments to India’s top oil producer

Venezuelan state oil-firm PDVSA has not made debt payments to India’s top oil producer ONGC for six months, and has previously used a Russian state-owned bank and another Indian energy company as intermediaries to make payments, two sources familiar with the transactions said on Wednesday.

ONGC Videsh, the overseas investment arm of ONGC, confirmed that PDVSA had fallen behind on the payments, but declined to give details on the delays.

They have got certain challenges at this stage,” ONGC Videsh said in an e-mailed response to Reuters’ questions. “They have assured that they are working on it (payment of dues). In due course it will be settled and follow up steps will be undertaken.

But the two sources, who requested anonymity, said PDVSA has made no payment since April on what was a $540 million backlog of dividends owed to ONGC for an investment the Indian firm made in a an energy project in Venezuela.

PDVSA declined to comment.

This Reuters story, filed from New Delhi, appeared on their Internet site at 11:10 p.m. EST on Wednesday morning — and was updated very early on Thursday morning.  It comes courtesy of Brad Robertson as well — and another link to it is hereZero Hedge had a follow-up to this news item headlined “Venezuela Just 24 Hours Away From Formal Declaration of Default”  — and I thank Brad for this one too.


Russia Warns It Will Retaliate Against American Media Next Week

It has been over a month since Russia and the U.S. engaged in political tit-for-tat escalations, but that is about to change: after a recent crackdown by the U.S. government, which ordered state broadcaster RT to register as a foreign agent following accusations it interfered in last year’s presidential elections, and which saw Twitter ban all RT-sourced advertising (despite actively seeking RT‘s business beforehand) Russia said on Thursday it would retaliate next week against the American media, Bloomberg reports.

While the Russians didn’t specify what measures would be taken, Foreign Ministry spokeswoman Maria Zakharova said Thursday that “practical implementation” of steps in response to the U.S. move would begin next week. Russia has previously warned its retaliation would mirror restrictions imposed by the U.S. The foreign-agent label, which applies to several state-owned outlets operating in the U.S. including Japan’s NHK and the China Daily newspaper, requires disclosure of the media organization’s foreign funding.

As reported earlier today, RT‘s editor-in-chief, Margarita Simonyan, said on the broadcaster’s website that it has no choice but to comply with the DOJ’s demand to register as a foreign agent by a final deadline of Monday.

Otherwise, the head of the channel’s U.S. subsidiary would face arrest and its bank accounts would be frozen, she said. “This demand violates U.S. law and we intend to appeal it in U.S. courts.

What may Russia’s next move be?  One month ago, Zakharova said that “we have never used Russian law in relation to foreign correspondents as a lever of pressure, or censorship, or some kind of political influence, never. But this is a particular case…

This Zero Hedge article was posted on their website at 6:13 p.m. on Thursday evening EST — and another link to it is here.


Saudi Arabia Orders Its Citizens to Leave Lebanon Immediately

In a odd coincidence, just moments after we published an article laying out Hezbollah’s military power at a time when both Saudi Arabia and Lebanon appear to be targeting Lebanon, and just two days after we discussed a leaked Israeli cable that confirmed Saudi Arabia and Israel are deliberately coordinating to destabilize the region and push Lebanon to a state of war, Saudi Arabia has ordered its citizens residing in Lebanon to leave immediately in a travel warning issued on Thursday, November 9. As Al Arabiya adds, the travel warning also called for Saudi nationals not to travel to Lebanon from any point of origin.

Full advisory below:

  • Official Source at the Ministry of Foreign Affairs: Saudi nationals visiting or residing in Lebanon are asked to leave the country as soon as possible.
  • Riyadh, Safar 20, 1439, November 09, 2017, SPA — Due to the situations in the Republic of Lebanon, the official source at the Ministry of Foreign Affairs stated that the Saudi nationals visiting or residing in Lebanon are asked to leave the country as soon as possible.
  • The Kingdom advised all citizens not to travel to Lebanon from any other international destinations.

This follows a similar warning issued by the Kingdom of Bahrain on November 5 urghing its nationals residing in Lebanon to leave immediately and to “exercise caution.” The Bahraini call came a day after Lebanese Prime Minister Saad Hariri announced his resignation, while on location in Saudi Arabia, citing concerns he could be assassinated like his father, criticized the Lebanon-based Hezbollah paramilitary and political movement and accused Iran of alleged attempts to bring destruction to the region. The Bahraini foreign ministry said in a statement received by AFP that its call was “in the interest of its citizens’ safety and to avoid any risks they may be exposed due to the conditions and developments” that Lebanon is going through.

Now it’s just a matter of when the bombing/invasion starts — and who ends up with their gold.  This Zero Hedge news item put in an appearance on their Internet site yesterday morning, but has been updated since.  I thank reader M.A. for sending it along on Thursday morning — and another link to it is here.


Saudi King May Relinquish Throne to Crown Prince Within 48 Hours: Reports

Multiple reports and rumors currently abound that the ailing king Salman could elevate his son Prince Mohammed bin Salman to the throne at any moment (or rather, it looks like bin Salman is set to seize the throne) after a shocking week of events following the so-called “corruption purge” that left the kingdom in a rare moment of internal political chaos and which further sent geopolitical shock waves through the region, most especially in Lebanon.

Though a transfer of power to the crown prince has long been predicted and expected, especially after a lesser known round of mass arrests targeting well-known Saudi clerics took place in September, this week’s events point to a final “house cleaning” purge in preparation for bin Salman’s likely imminent ascent.

After the September arrests against clerics who were largely seen as regime insiders, yet who were mildly critical of the new aggressive stance against Qatar, the WSJ quoted an adviser to the Saudi government as saying, “Mohammed bin Salman is definitely preparing to become king. He wants to tackle the internal debate about him becoming the king and focus on consolidating his power, rather than doing that while being distracted by dissidents.

And AbuKhalil, who authored a book which examined internal Saudi regime fault lines called The Battle for Saudi Arabia: Royalty, Fundamentalism, and Global Power, has just made another prediction based on his extensive contacts within Saudi Arabia. Last night he said bin Salman will declare himself king in less than 2 days: “I am hearing that he will be declaring himself king in the next 36 hours and that recent arrests paved the way.”

No surprises here — and it’s certainly no coincidence that now that Syria has ceased to become an issue, more war was needed somewhere else in the Middle East.  This news item showed up on the Zero Hedge website at 11:00 a.m. EDT yesterday morning — and I thank Brad Robertson for pointing it out.  Another link to it is here.


The Saudi Purge: The Middle East is on the Verge of a New War

King Salman even visited Moscow, where the two sides exchanged promises with no guarantees that these will ever be fulfilled. This also backfired, as some considered it a demonstration of weakness or an attempt to make peace by making concessions.

Add economic struggles to this series of failures, and one can see why the King’s and his Crown Prince’s position seem less and less stable by the minute. The situation apparently seemed so dire, that in order to keep everything afloat, active persecution seemed the only possible way to keep the King and his successor in power. The “anti-corruption” campaign is just an excuse: the corruption has always been high in Saudi Arabia, and no one batted an eye before now.

These are temporary measures.

Persecution can hardly solve foreign and internal matters, and it will not lead to a solution of the problems. Right now, the kingdom’s leadership is desperately in need of an enemy to unite the population and draw their attention away from the chaotic events that unfolding in the country.

A warlike rhetoric against Iran, Lebanon and Hezbollah are a clear sign of this. While Iran is a potent regional power in military and diplomatic terms, Hezbollah is a non-state actor. So, Riyadh may choose the group as an enemy for its risky foreign policy undertaking. Saudi Arabia and Israel are obvious allies in their will to destroy Hezbollah. On November 5, Tel Aviv started the largest-ever aerial exercise in the history of Israel. A leaked diplomatic cable confirmed that the Saudis and Israelis are coordinating their efforts against Iran and Hezbollah thus escalating the already tense situation in the Middle East.

The region may be heading for another large-scale military conflict.

No kidding!  This commentary was posted on thesaker.is Internet site on Wednesday — and I thank Roy Stephens for sending it our way.  Another link to it is here.


China Factory Prices Surge Again as Pollution Drive Curbs Output

China’s factory prices kept surging last month as authorities curb production in smokestack industries to combat pollution.

  • The producer price index rose 6.9 percent in October from a year earlier, versus a projected 6.6 percent rise in a Bloomberg survey and matching September’s pace
  • The consumer price index climbed 1.9 percent, the statistics bureau said Thursday, exceeding the median forecast of 1.8 percent

Policy makers signaled a shift away from the growth-at-all-costs model at their twice-a-decade Party Congress last month amid greater focus on curbing pollution and taming financial risk. China has stepped up restrictions on steel mills and aluminum factories before winter, when pollution levels are often at their worst in the northern part of the country.

Today’s inflation data basically dismiss any hope for monetary policy easing,” said Raymond Yeung, chief greater China economist at Australia & New Zealand Banking Group in Hong Kong. “The authorities will continue to maintain a tightening bias. Onshore rates are seeing upward pressure.”

The data show production cuts driven by environmental cleanups exceeded expectations,” said Zhao Hongyan, a China economist at Huatai Financial Holdings Ltd. in Hong Kong. “China’s economy is softening this quarter, but there’s no danger of a sharp slowdown.

This brief Bloomberg news item was posted on their website at 6:33 p.m. Denver time on Wednesday evening — and updated about three and a half hours later.  I found it in yesterday’s edition of the King Report — and another link to it is here.


Trump’s $250 Billion China Haul Features Little of Substance

The headline number is impressive: A quarter-trillion dollars worth of deals from China that President Donald Trump can use to show he’s creating opportunities for U.S. businesses and jobs for his base.

The reality, however, is that the roughly 15 agreements unveiled on Thursday are mostly non-binding memorandums of understanding and could take years to materialize — if they do at all. A day earlier, Commerce Secretary Wilbur Ross announced $9 billion of deals, many also MOUs with few details, rather than contracts.

To me this is an old-style visit when you pile up all the deals so you can to get a big number,” said James McGregor, China chairman of the consultancy APCO Worldwide. “This was normal when the U.S. and China were just building ties, but now China is a global business power and has very damaging industrial policies and this seems naive. This is all for show for President Trump to demonstrate his deal-making prowess.”

Both Trump and Chinese President Xi Jinping hailed the deals on Thursday, calling them examples of “win-win” cooperation between the world’s biggest economies. At the same time, Xi said that China would open its market according to its own “timetable and road map” while calling to respect each other’s “differences” — showing that Trump will find it harder to press him for substantive policy changes.

The non-committal nature of many of the deals reflects a lack of planning or advance work ahead of Trump’s visit to pin down significant agreements or concessions from China, according to two administration officials who asked not to be identified to speak about private deliberations.

This Bloomberg news story showed up on their Internet site at 8:55 p.m. MST on Wednesday evening — and was updated five hours later.  I thank Brad Robertson for sharing it with us — and another link to it is here.


Silver’s bullish underpinning — it’s an essential metal for these 3 growth industries

Prospects for tighter interest-rate policy, dollar strength and record-setting stock levels continue to push and pull at metals prices, including a silver market that straddles the line between an investment asset and industrial necessity.

A longer-term view of silver’s prospects, however, requires a closer look at its industrial role, where high-growth industries including self-driving cars, solar power and health care will call for more silver over coming months and years.

Demand prospects were among the largely upbeat takeaways from a Silver Institute conference late last month.

On top of demand trends, there are supply factors in the industrial-use equation that are also supportive to prices.

“The overwhelming consensus was that the current silver price is too low, given difficulties finding and developing new mines and increasing political risk — governments wanting bigger pieces of the mining revenue pie, such as what’s happening in Tanzania,” said conference attendee Maria Smirnova, a senior portfolio manager at Sprott Asset Management LP, the lead portfolio manager of the Sprott Silver Equities Class and a co-manager of the Sprott Gold and Precious Minerals fund.

I sent an e-mail off to the ‘reporter’ who filed this item — and explained the real situation in silver, along with the latest ‘Days to Cover’ chart.  I’ll let you know if I ever hear back from her.  This silver-related news item put in an appearance on the marketwatch.com Internet site at 2:51 p.m. EST on Thursday afternoon — and I thank Richard Saler for pointing it out.  Another link to it is here.


Third-quarter gold demand slides to eight-year low, World Gold Council says

Gold demand slid to its lowest in eight years in the last quarter as jewelry buying fell and inflows into bullion-backed exchange traded funds dried up, data from the World Gold Council showed on Thursday.
Overall demand fell 9 percent to 915 tonnes, its weakest since the third quarter of 2009, the WGC said.

That pattern is likely to feed through to the full year, with the WGC forecasting annual demand of just 3,900-4,000 tonnes, compared to 4,347 tonnes in 2016. Gold demand has not been below 4,000 tonnes on an annual basis since 2009.

ETF inflows year to date are a fraction of the stellar inflows we saw last year,” the WGC’s head of market intelligence Alistair Hewitt said. “India is similarly weak.

On the supply side, overall mine output was down 1 percent at 841 tonnes in the third quarter, while recycled gold supply dropped 6 percent to 315 tonnes.

Of course, dear reader, if the gold price was allowed to rise by JPMorgan et al, then gold ETF demand would soar…a fact that the WGC conveniently leaves out.  This worthwhile gold-related Reuters article, filed from London, showed up on their Internet site at 10:10 p.m. EST on Wednesday evening — and I found it embedded in a GATA dispatch.  Another link to it is here.


Some positives from latest WGC report — Lawrie Williams

On the face of things the latest WGC report looks as if it might make for dismal reading for gold enthusiasts, but it should be noted that the biggest decline compared with the year ago figures was in volumes of gold purchases by global gold ETFs – but these were still positive.  It should perhaps be remembered that when gold suffered its huge price declines from 2011, which only started to turn around in 2015, there were huge withdrawals from the gold ETFs, in part countered by strong Chinese demand at the time, otherwise gold’s decline would undoubtedly have been even greater than it was.

There was also a sharp fall in Q3 in Indian jewellery demand, but again this was the first quarter following the country’s new GST imposition, and tends to be a weak part of the year for Indian jewellery demand anyway being a hiatus period ahead of the big Diwali festival and the start of the peak season for Hindu weddings.  Q4 figures will thus be a far better indicator of the true Indian gold demand position.  Indian gold imports have slipped quite dramatically in August and September, but as we commented in our recent article on Indian gold demand they are still running comfortably ahead of a year ago – indeed gold imports in the first half of the year had already exceeded those for the whole of 2016.  Once again we will have to wait for Q4 figures to see the full picture.

This absolute must read commentary by Lawrie appeared on the Sharps Pixley website yesterday sometime — and another link to it is here.


China’s ‘Official’ gold reserves now unchanged for a full year

Readers of my writings here will be well aware that I do not believe that China has not being increasing its gold reserves which, in terms of the figure reported to the IMF, have now remained unchanged for a full calendar year.  It seems to be more than coincidental that the nation has reported a zero increase in its gold reserves ever since the yuan became an integral part of the IMF’s special drawing right in October last year and looks to have reverted to its historic pattern of not reporting gold reserve increases while building them up surreptitiously and then only announcing any rises at around five or six year intervals – or when it suits the country to do so.  We also feel that even these reported reserve levels probably understate the country’s true gold reserve position – probably quite substantially.

[T]he country did report month by month increases from July 2015 to October 2016 in the run-up to the yuan’s acceptance into the SDR, but ever since then the gold reserve position appears to have been effectively frozen – the IMF certainly has reported no change over this period, but it relies on the figures released by the country for its data.  The figure keeps China officially in fifth place among national gold reserve holders, but Russia, in sixth, which does report its monthly gold increases is rapidly closing the gap – that is if one takes the official Chinese figures at face value.

This is the second commentary from Lawrie on the Sharps Pixley website yesterday — and the link to this brief 1-chart article is here.


Chinese Valentine’s Day boosts gold sales by 13pc in third quarter

Chinese Valentine’s Day, or the Qixi Festival, falls on the seventh day of the seventh lunar month and celebrates the romantic folk tale of a fairy who was only allowed to meet her mortal husband on this day.

The festival usually falls in August and many among the younger generation consider it the Chinese version of Valentine’s Day, and buy gold jewellery to show their love. Gold in Chinese culture symbolises unchanged love.

The bounce in gold is also being viewed as a sign of broader economic recovery on the mainland. This has led many jewellers to open new stores in smaller cities in the third quarter, after two years of store closures due to weak demand.

Holiday purchases have lifted demand, albeit from a very low base. Leading retailers reported decent growth in the quarter – sales were up both in terms of value and volume, and new store openings,” the report said.

The five-day Shenzhen Jewellery Fair, held from September 14 to 18, reported a good response in terms of visitor numbers and sales exceeded expectations, the report said.

Mainland jewellers are replenishing inventories ahead of the Chinese New Year festive buying season after a prolonged period of stagnation.

This worthwhile news story showed up on the South China Morning Post website at 5:32 p.m. China Standard Time on their Thursday afternoon, which was 4:32 a.m. EST in New York — EDT plus 13 hours.  I found it on the Sharps Pixley website — and another link to it is here.


The PHOTOS and the FUNNIES

I’ve been saving these two shots for last, as this was the bird ‘catch of the year’ for me.  I’ve only seen maybe a half a dozen of these critters in my entire life — and this was the first with camera in hand back on September 24.  They’re very skittish birds — and I was ever so grateful that it allowed me to get this close.  It’s a greater yellowlegs — and it’s not hard to figure out how it came by that name.  It’s a large North American shore bird — and their breeding habitat is bogs and marshes in the boreal forest region of Canada and Alaska.  Since this fellow was in the city, it was obviously migrating — and had just stopped to ‘gas up’ at the local pond.  It stuck around for about a week before moving on.  The ‘click to enlarge‘ feature helps with both shots.


The WRAP

It was yet another day where there wasn’t much upside price activity allowed in gold — and volume was sky high once again.  The price pressure on silver was also obvious, as it wasn’t allowed a sniff of its 50 or 200-day moving averages — and it was closed back below $17 spot for the third day in a row.

There were no moving averages broken in the other precious metals, either — and palladium closed above the $1,000 spot mark for the second day in a row.

Here are the 6-month charts for all four precious metals, plus copper — and except for silver, there’s not a lot to see.  The ‘click to enlarge‘ feature helps a bit with the first four graphs.

And as I type this paragraph, the London open is less than ten minutes away — and I see that the gold price crawled a few dollars higher in the first two hours of trading once it began at 6:00 p.m. EST on Thursday evening in New York. Then at 9 a.m. China Standard Time on their Friday morning it was turned lower — and has been chopping mostly lower ever since. At the moment, gold is down $1.50 an ounce. Silver made several attempts to break back above — and then stay above $17 spot, but was turned lower every time. It’s up 2 cents currently. Platinum and palladium haven’t been doing much in Far East trading, with the former down a dollar — and the latter by 2 as the Zurich open approaches.

Net HFT gold volume is coming up on 46,000 contracts, with a decent amount of switch/roll-over volume out of December already. Net HFT silver volume is around 7,800 contracts, with little in the way of roll-over/switch volume.

The dollar index has been chopping sideways in a very tight trading range during the major part of the Far East trading session, but starting a few minutes before 3 p.m. CST, it began to tick higher — and I would suspect that’s the reason that gold and silver prices have been turned lower in the last hour. The index is currently up 6 basis points as London opens.

With no Commitment of Traders or Bank Participation Reports today, my Saturday column is going to be pretty skinny. With all that data in it, it’s the largest column of the month. However, since it normally comes out on the weekend, you have more time to digest it. That means that all the data will get shoved into Tuesday’s column, so you can gird your loins for that day.

And as I post today’s efforts on the website at 4:02 a.m. EST, I note that not much happened during the first hour of trading in London.  Gold is down $1.70 an ounce, silver is up 4 cent to $16.99 spot.  However, platinum is now down only a dollar — and palladium is up 2 bucks during the first hour of trading in Zurich.

Gross gold volume is way up there now at something over 71,000 contracts — and net of roll-over/switch volume out of December, net HFT gold volume is around 63,000 contracts.  Net HFT silver volume is pretty close to 11,000 contracts.  Those are big increases over the last hour, so it appears that JPMorgan et al have been around keeping prices under control.

The dollar index was up 12 basis points by shortly after the London open, but has fallen back to 1 basis point above unchanged.

With today being a holiday in the U.S. for some, I’m not sure what to expect during the Friday session in New York. But whatever it is, I’ll have it all for you on Saturday.

Enjoy your weekend/long weekend — and I’ll see you here tomorrow.

Ed