The Manic In/Out Activity in COMEX Silver Continues

03 November 2018 — Saturday

YESTERDAY in GOLD, SILVER, PLATINUM and PALLADIUM


The gold price edged a bit lower until around 10:30 a.m. in Far East trading on their Friday morning — and crawled higher from there — and was up about two bucks by shortly before 10 a.m. in London.  That lasted until the noon silver fix — and it was sold a bit lower from there and back into negative territory by 9 a.m. in New York.  The subsequent rally, such as it was, was capped and sold back into negative territory, the moment it hit its noon silver fix high.  From there it didn’t do anything for the remainder of the day.

The gold price was forced to trade a few dollars either side unchanged all day on Planet Earth — and the high and low ticks, such as they were, aren’t my time to look up.

Gold was closed in New York yesterday at $1,232.20 spot, down 70 cents on the day.  Gold volume was nothing special at just under 236,500 contracts — and there was just under 14,000 contracts worth of roll-over/switch volume in this precious metal.

In most respects, the price action in silver was very similar…at least up until shortly after the afternoon gold fix in London. It spiked higher at that point, but was capped and driven lower almost immediately — and the sell-off lasted until the COMEX close. It traded flat from there until the session ended at 5:00 p.m. EDT.

The low and high ticks in this precious metal were reported by the CME Group as being only 9 cents apart, so that post-afternoon gold fix price spike you see on the chart below, was confined to the spot market.

Silver finished the Friday session at $14.715 spot, down 0.5 cents on the day.  But net volume was sky high at a hair over 97,000 contracts — and there was 7,413 contracts worth of roll-over/switch volume on top of that.  What the heck was that all about, I wonder?  I mentioned it to Ted yesterday — and I’ll see if he says anything about it in his weekly commentary today…but something doesn’t pass the smell test here.

The platinum price was up 7 bucks or so by the Zurich open — and then traded ruler flat until the noon silver fix in London…8 a.m. EDT in New York. Like silver and gold, it was sold down a bit from there, but recovered right away — and rallied a bit more until around 10:20 a.m. EDT.  It chopped quietly sideways into the close from there.  Platinum finished the day at $867 spot, up 9 dollars from Thursday.

Palladium didn’t do much of anything when trading began at 6 p.m. EDT in New York on Thursday evening, but was up a couple of dollars by shortly after 2 p.m. China Standard Time on their Friday afternoon.  It began to creep quietly higher from that juncture — and its spike high tick of the day came about 12:45 p.m. in New York trading.  It was capped and sold lower into the COMEX close from there, but tacked on a few more dollars in after-hours trading.  Palladium was closed in New York on Friday at $1,105 spot, up 23 bucks on the day. And it was another day where it would have closed far higher in price than it was allowed to.

The dollar index closed very late on Thursday afternoon in New York at 96.30 — and crept about 10 basis points higher once trading began at 6:00 p.m. EDT a few minutes later.  That lasted until very shortly before 10 a.m. CST on their Friday morning — and from there it began to roll over.  The usual ‘gentle hands’ appeared at the 95.99 mark, its low tick of the day, which came minutes after 11 a.m. in London.  The ensuing ‘rally’ chopped higher until around 12:10 a.m. in New York — and it crept lower into the close from there.  The dollar index finished the Friday session at 96.50…up 20 basis points from Thursday.

And here’s the 6-month U.S. dollar index chart — and the delta between its close…96.34…and the intraday chart above, was 16 basis points yesterday.

The gold shares opened down a percent and change when trading began at 9:30 a.m. in New York yesterday morning — and then proceeded to chop very unevenly sideways until shortly before 1 p.m. EDT.  A quiet, but steady rally developed at that point, but they couldn’t quite squeeze a positive close, as the HUI finished down a tiny 0.17 percent.

The silver equities opened down about a percent, but were back in positive territory in very short order — and stayed mostly in the green from there.  A rally ensued starting around 12:40 p.m. EDT — and they chopped quietly higher into the close from there.  Nick Laird’s Intraday Silver Sentiment/Silver 7 Index finished up 0.83 percent.  Click to enlarge if necessary.

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

Here are the usual charts from Nick that show what’s been happening for the week, month-to-date — and year-to-date.  The first one shows the changes in gold, silver, platinum and palladium for the past trading week, in both percent and dollar and cents terms, as of their Friday closes in New York — along with the changes in the HUI and the Silver 7 Index.

Here’s the weekly chart — and it’s a lot happier looking than it was this time last week — and the gold shares outperformed the silver equities by a bit, but that’s not overly surprising considering how badly beat up silver was during the week just past.  Click to enlarge.

There’s no month-to-date chart this week, as the month is only two days old — and Nick’s chart program is not set up to capture just one or two trading days.  However, if we could see it, it would be wall-to-wall green. The month-to-date chart will return in this space next week.

The year-to-date chart continues to be [mostly] a sea of red, but improving — and it’s still clear from this chart that the silver equities are ‘outperforming’ their golden brethren, however that’s not saying much.  Click to enlarge.

As I said in this space last week…this bull market in the precious metals is just getting started.  This past week was a happy one — and we can only hope that this trend will continue.  But it’s still JPMorgan’s world — and they’ll do whatever they want, or until they’re told to step aside.


The CME Daily Delivery Report showed that 17 gold and 3 silver contracts were posted for delivery within the COMEX-approved depositories on Tuesday.  I’m not going to bother breaking down these tiny amounts — and if you wish to see the numbers for yourself, the link to yesterday’s Issuers and Stoppers Report is here.

The CME Preliminary Report for the Friday trading session showed that gold open interest in November declined by 3 contracts, leaving only 24 left, minus the 17 contracts mentioned just above.  Thursday’s Daily Delivery Report showed that 20 gold contracts were actually posted for delivery on Monday, so that means that 20-3=17 more gold contracts just got added to the November delivery month — and it’s a very safe bet that those 17 contracts are the ones out for delivery on Tuesday, as per the above Daily Delivery Report.  Silver o.i. in November dropped by 8 contracts, leaving 399 still around, minus the 3 mentioned in the previous paragraph.  Thursday’s Daily Delivery Report showed that 6 silver contracts were actually posted for delivery on Monday, so that means that 8-6=2 silver contracts vanished from the November delivery month.


There was a small withdrawal from GLD on Friday, as an authorized participant took out 56,757 troy ounces.  There was also a smallish withdrawal from SLV, as an a.p. removed 142,594 troy ounces.  I doubt very much that they’re a fee payment, as both withdrawals are a bit too chunky for that.  Ted may or may not have something to say about this in his weekly commentary later today.

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

There was no in/out activity in gold over at the COMEX-approved depositories on the U.S. east coast on Thursday.

But it was yet another big day in silver — and although nothing was reported received, there was 2,086,297 troy ounces shipped out for parts unknown.  The biggest was two truckloads…1,199,193 troy ounces…out of Malca-Amit USA.  Another truckload…605,629 troy ounces…left CNT — and smaller amounts…240,186 troy ounces — and 41,287 troy ounces…departed Scotiabank and Delaware respectively.  The link to all this activity is here.

In my discussion with Ted yesterday, he mentioned that a bit over/under 13 million troy ounces of silver was moved into, or shipped out of, the COMEX approved depositories over the last five business days.  Why all this manic activity — and why don’t the so-called precious metal commentators other than Ted…and by extension, myself…want to deal with this issue head on?

There was some activity over at the COMEX-approved gold kilobar depositories in Hong Kong on their Thursday.  They reported receiving 1,350 of them — and shipped out 473.  All of this occurred at the Brink’s, Inc. depository of course — and the link to that, in troy ounces, is here.


Here are two charts from Nick Laird that show bullion coin sales for The Perth Mint, updated with October’s sales data.  For the month they sold 36,840 troy ounces of gold — and 1,079,684 troy ounces of silver.  Click to enlarge for both.

Nick also sent along the charts for U.S. Mint sales for October as well, but I had that sales data in my Thursday column I believe, so I’ll save these charts for Tuesday.


The numbers in the Commitment of Traders Report, for positions held at the close of COMEX trading on Tuesday, came in pretty much as expected, as there were improvements in the commercial net short positions in both silver and gold for the reporting week.

In silver, the Commercial net short position declined by 3,502 contracts, or 17.5 million troy ounces of paper silver.  I was sort of expecting a bigger number than that, considering the fact that silver close below its 50-day moving average for three of the five reporting days.

They arrived at that number by adding 5,819 long contracts, plus they increased their short position by 2,317 short contracts — and it’s the difference between those two numbers that represents the change for the reporting week.

Despite the increases in the Commercial net short position in silver recently, the position changes of the Big 4 and Big ‘5 through 8’ traders are still immaterial because of the contamination of that data by the large number of Managed Money traders that still inhabit this group.  However, it should be pointed out that JPMorgan’s short position is probably just large enough to make the #7 or #8 spot of the Big ‘5 through 8’ category.  But even that number is pretty small when compared to any member of the Big 4.

Under the hood in the Disaggregated COT Report, it was all Managed Money traders, plus a bit more…as they reduced their long position by 224 contracts — and they added 3,927 short contracts — and it’s the sum of those two numbers…4,151 contracts…that represents their change for the reporting week.  The difference between that number — and the Commercial net short position…4,151 minus 3,502 equals 649 contracts…was, like it always is, made up the traders in the ‘Other Reportables’ — and ‘Nonreportable’/small trader category.  I won’t bother with a ‘snip’ from the Disaggregated Report this week, as they’re nothing to see.

The Commercial net short position in silver is down to 9,760 contracts, or 48.8 million troy ounces which, in historical terms, is a very tiny number.

Ted didn’t think that JPMorgan did much during the reporting week — and he pegs their short position at a bit over 10,000 contracts…the same as it was last week at this time.

Here’s the 3-year COT Report for silver — and the change is not overly material.  Click to enlarge.

As I stated in Friday’s column, the data in this COT Report is very much yesterday’s news after the big price spike through silver’s 50-day moving average on Thursday. It remains to be seen what happens during the final two trading days of next week’s COT Report, as a lot can happen between now and then.

And along with next Friday’s COT Report, we get the monthly Bank Participation Report as well — and this will allow Ted to recalibrate JPMorgan’s short position.  It also may shed some light on Citigroup’s short position in silver as well, which is certainly much smaller than JPMorgan’s.


In gold, the commercial net short position declined by a pretty hefty 15,315 contracts, or 1.53 million troy ounces of paper gold.

They arrived at that figure by adding 2,443 long contracts — and they also reduced their short position by 12,872 contracts — and it’s the sum of those two numbers that represents the change for the reporting week.

And, as in silver, despite the increases in the Commercial net short position in gold recently, the position changes of the Big 4 and Big ‘5 through 8’ traders are still immaterial because of the contamination of that data by the large number of Managed Money traders that still inhabit this group…although JPMorgan’s short position in gold might be getting very close.

Under the hood in the Disaggregated COT Report, it was all Managed Money traders as well — and then some, as they reduced their long position by a very hefty 19,263 contracts — and they reduced their short position by 1,856 contracts — and it’s the difference between those two numbers…17,407 contracts…that represents their change for the reporting week.  Ted was somewhat mystified by the big drop in the Managed Money long position, as there were no major moving averages penetrated during the reporting week — and he’ll certainly be commenting on that in his weekly column later today.

The difference between what the Managed Money traders sold — and what the commercial traders bought…17,407 minus 15,315 equals 2,092 contracts…was made up by the traders in the other two categories…the ‘Other Reportables’ and the ‘Nonreportable’/small traders.  Here’s the clip from the Disaggregated Report for gold so you can see the surprising decline in the Managed Money long position, which is now at historically low levels.  Click to enlarge.

The commercial net short position in gold is down to 31,205 contracts, or 3.12 million troy ounces of paper gold.

Here is the 3-year COT chart for gold — and the weekly change should be noted.  Click to enlarge.

Of course there’s been some increase in the commercial net short position in gold since the Tuesday cut-off, but there are still two more trading days left in the reporting week and, like in silver, anything could happen between now and then to change what next Friday’s COT Report will show. 

It was certainly disappointing that there was no price follow-through after the big precious metal rallies that occurred on Thursday — and Ted mentioned that the Managed Money traders in silver may be getting set up to be harvested once again by the Commercial traders running  the price back down through the 50-day moving average one more time…just like they did after the big rally in silver on October 12.  That would apply to gold as well, but not to the same extent, as it never got below its 50-day moving average before Thursday’s rally.

But I’ll point out one more time that despite Thursday’s rally — and resulting increases in the commercial net short positions of both silver and gold, the set-ups for a major rally are still very much in place…if JPMorgan wishes it to happen.  Not a thing has changed in that respect.

In the other two precious metals, the Managed Money traders increased their net long position in platinum by 3,232 contracts during the reporting week.  The Managed Money traders in palladium didn’t do much during the reporting week, they decreased their long position by a rather immaterial 641 contracts.  That’s not a lot of contracts for an approximately 40 dollar decline in the palladium price during the reporting week.  Copper got smacked back below its 50-day moving average during the reporting week — and Pavlovian brain-dead Managed Money traders followed the script to the letter, increasing their net short position by just under 10,000 contracts during the reporting week…with the commercial traders going long the lion’s share of that amount.


Here’s Nick Laird’s “Days to Cover” chart updated with yesterday’s COT data for positions held at the close of COMEX trading on Tuesday. It shows the days of world production that it would take to cover the short positions of the Big 4 — and Big ‘5 through 8’ traders in each physically traded commodity on the COMEX. Click to enlarge.

But, like the COT Report itself, the chart above is basically irrelevant at this point as well — and for the same reason. Except for Scotiabank — and one or two U.S. banks…the positions of the Big 4 and Big 8 traders are mostly made up of the brain-dead/moving average-following Managed Money traders now.

For the current reporting week, the Big 4 traders are short 104 days of world silver production, down 6 days from what they were short in last week’s report — and the ‘5 through 8’ large traders are short an additional 53 days of world silver production, which is up 4 days from last week’s report—for a total of 157 days held short, which is five months and change of world silver production, or about 366.4 million troy ounces of paper silver held short by the Big 8. [In last week’s COT Report the Big 8 were short 160 days of world silver production.]

The Big 8 commercial traders are short 35.1 percent of the entire open interest in silver in the COMEX futures market, which is down a bit from the 37.5 percent that they were short in last week’s COT Report. And once whatever market-neutral spread trades are subtracted out, that percentage would be something around 40 percent. In gold, it’s 32.8 percent of the total COMEX open interest that the Big 8 are short, down from the 36.2 percent they were short in last week’s report — and something close to 40 percent once the market-neutral spread trades are subtracted out.

As I stated in my COT discussion on silver, JPMorgan’s short position in silver would put in back in the Big ‘5 through 8’ large trader category.  But I doubt that Citigroup’s short position in silver is anywhere near large enough to fall into that category.

In gold, the Big 4 are short 37 days of world gold production, which is down 4 days from what they were short last week — and the ‘5 through 8’ are short another 17 days of world production, which is down 2 days from what they were short the prior week, for a total of 54 days of world gold production held short by the Big 8 — which is down 6 days from what they were short in last week’s report. Based on these numbers, the Big 4 in gold hold about 69 percent of the total short position held by the Big 8…which is up about 1 percentage point from last week’s COT Report.

And, once again, don’t forget that like in silver…a lot of the traders in the Big 4 and Big 8 categories in gold are still Managed Money traders — and not the commercial variety.

The “concentrated short position within a concentrated short position” in silver, platinum and palladium held by the Big 4 commercial traders are about 66, 70 and 75 percent respectively of the short positions held by the Big 8. Silver is down 3 percentage points from the previous week’s COT Report, platinum is up another 1 percentage point from a week ago. Palladium is down 1 percentage point from last week’s COT Report.

I only have a tiny handful of stories for you today.


CRITICAL READS

Bolton Calls National Debt ‘Economic Threat’ to U.S.

U.S. National Security Adviser John Bolton called the national debt a “threat to the society” that requires significant cuts to the government’s discretionary spending.

Bolton, speaking Wednesday at an event hosted by the Alexander Hamilton Society in Washington, said he expects U.S. defense spending “to flatten out” in the near term. He said he didn’t anticipate major cuts to entitlements such as Medicare and Social Security.

It is a fact that when your national debt gets to the level ours is, that it constitutes an economic threat to the society,” Bolton said. “And that kind of threat ultimately has a national security consequence for it.

This Bloomberg news item, courtesy of Paul Fillion, appeared on their website at 11:06 a.m. PDT time on Wednesday — and was updated about ten minutes later. Another link to it is here.


The Fed’s QE Unwind Hits $321 Billion — Wolf Richter

Over the four-week period from October 3 through October 31, the Federal Reserve shed $35 billion in assets, according to the Fed’s weekly balance sheet released Thursday afternoon. This brought the balance sheet to $4,140 billion, the lowest since February 12, 2014. Since October 2017, when the Fed began its QE unwind, or “balance sheet normalization,” it has now shed $321 billion…

The Fed acquired Treasury securities and mortgage-backed securities (MBS) as part of QE, which ended in 2014. Between the end of QE and the beginning of the QE Unwind in October 2017, the Fed replaced maturing securities with new securities to keep their levels roughly the same. In October last year, the Fed kicked off the QE unwind and began shedding those securities. But the balance sheet also reflects the Fed’s other activities, and the amount of its total assets is always higher than the sum of Treasury securities and MBS it holds.

October was a new milestone: the QE unwind left the ramp-up phase and entered the cruising-speed phase, according to the Fed’s plan. In the cruising-speed phase, the Fed is scheduled to shed “up to” $30 billion in Treasuries and “up to” $20 billion in MBS a month, for a total of “up to” $50 billion a month.

This 3-chart article was posted on the wolfstreet.com Internet site on Thursday sometime — and I thank Richard Saler for bringing it to our attention.  Another link to it is here.


Doug Noland: MBS and the Core

At the same time, I don’t believe the U.S./China trade spat has been the major force behind global de-risking/deleveraging. Stated differently, this dispute worsened the situation but was not the catalyst behind the bursting of the global Bubble. Indeed, from a de-risking/deleveraging perspective, Friday’s yield jump was ominous. Fixed-income investors and speculators have no doubt been hoping that “risk off” would provide some relief on the market yield front. With an equities short squeeze and strong payrolls data, the pressure just became too intense.

MBS [Mortgage Backed Securities] yields have broken out to the upside, with corporate and Treasury yields close behind. Equity market players are certainly hoping a trade deal is in the works. Fixed-income players not so much. And it is within fixed-income on a global basis that problematic leverage lurks. Leveraged “risk parity” strategies saw some relief from this week’s equities rally, but they must look at rising market yields with increasing trepidation.

We’re now only days from the midterms. It’s an especially difficult event to handicap from a market standpoint. Red wave or blue wave. I don’t recall midterm elections where the outcome had the potential to be so market moving. Blue wave – big. Red wave – big. Making things all the more interesting, there has been major market instability heading into the elections. This ensures there have been major shorting and hedging efforts – to hedge/speculate both on the markets and midterm outcomes.

I’ll assume large quantities of put options and derivative protection have been purchased. In the event of a red wave, there is ample firepower for an unwind of hedges and short covering to spark a rally. In the event of a blue wave, a market downdraft would see aggressive hedge-related selling by players caught on the wrong side of derivative protection previously sold. The stock market response to the anticipated blue House and red Senate split decision is not clear at all. But maybe equities have become a diversion. In a week where the focus was on short squeezes and tantalizing equities rallies, perhaps the more decisive development was in surging MBS and corporate yields.

This very worthwhile commentary from Doug put in an appearance on his website in the very wee hours of Saturday morning EDT — and another link to it is here.


What Americans Really Need Right Now — Bill Bonner

What America most lacks is cynicism.

People listen to a news conference without laughing. They read the headlines without even guffawing.

They believe their “warriors” are protecting them abroad. At home, they think their elected officials have their backs.

And they think their president should be treated with the respect normally reserved for traffic cops and drill sergeants.

As for their money… they are ready to believe almost anything.

This commentary by Bill put in an appearance on the bonnerandpartners.com Internet site very early on Friday morning EDT — and another link to it is here.


A senior Russian diplomat confirms: “Russia is preparing for war” – is anybody listening? — The Saker

Andrei Belousov, deputy director of the Russian Foreign Ministry’s Department of Nonproliferation and Arms Control, has recently made an important statement which I shall quote in full.

Recently at a meeting the United States stated that Russia is preparing for war. Yes, Russia is preparing for war, I can confirm it.  Yes, we are preparing to defend our homeland, our territorial integrity, our principles, our values, our people. We are preparing for such a war.  But there is a major difference between us and the United States.  Linguistically, this difference is just in one word, in both Russian and English: Russia is preparing for war while the United States is preparing a war” (emphasis added).

We are so used to western diplomats and politicians saying more or less anything and everything (as the joke goes: when do you know that a politician is lying? When his lips move) that many of us stopped paying attention to what is being said. If tomorrow Trump or some “Congressperson” goes on national TV and declares “read my lips – up is down, dry is wet and yes means no” – most of us will just ignore it. The truth is that being exposed to that constant stream of empty, bombastic and always dishonest statements makes most of us immune to verbal warnings, even when they come from non-western political figures.

It is, therefore, crucial to fully realize that Russian official and diplomats carefully measure every word they say and that when they repeat over and over again that Russia is ready for war, they actually and truly mean it!

This commentary by the Saker showed up on his Internet on Friday morning sometime — and I thank Larry Galearis for pointing it out.  Another link to it is here.


Trump to reinstate all U.S. sanctions on Iran, targeting over 700 entities and individuals

All sanctions on Iran lifted under the 2015 nuclear deal will be back in force on November 5, the US administration has announced.

The sweeping sanctions will see 700 people blacklisted, the U.S. Treasury has announced. These include persons that were granted relief under the 2015 deal, as well as over 300 new names, Treasury Secretary Steven Mnuchin told reporters.

Sanctions will also target payments through the special mechanism that the E.U. has been creating specifically to avoid Washington’s penalties and to keep buying Iranian oil.

Mnuchin has also threatened sanctions against the transaction service SWIFT.

SWIFT is no different than any other entity,” Mnuchin told reporters. “We have advised SWIFT that it must disconnect any Iranian financial institutions that we designate as soon as technologically feasible to avoid sanctions exposure.”

Secretary of State Mike Pompeo has confirmed earlier reports that eight nations will receive exemptions from the reimposed penalties, but refused to name them and said the E.U. as a singular entity was not among them. Earlier reports suggested that the list of exemptions would include Japan, India and South Korea.

Swedish reader Patrik Ekdahl dropped this in my in-box about one minute after I’d sent out the e-mail version of today’s column, but I thought I’d add it to the website copy.  This rt.com news item was posted on their website at 14:33 Moscow time on their Friday afternoon, which was 7:33 a.m. in Washington — EDT plus 7 hours.  The story was updated about two hours later.  Another link to it is here.


Chris Powell at New Orleans conference: Gold market manipulation update, November 2018

Since we met at this conference last year much new evidence of manipulation of the gold market by central banks and their bullion bank agents has been compiled and disclosed by the Gold Anti-Trust Action Committee.

For example, a month ago a major bullion bank, the Bank of Nova Scotia, admitted to the U.S. Commodity Futures Trading Commission that it had manipulated the gold and silver futures markets from June 2013 through June 2016.

Ironically, in September 2013 the CFTC had closed its long-running investigation of silver market manipulation, announcing that the commission could not find anything actionable. That was three months after the Bank of Nova Scotia now admits its market rigging began.

In January the U.S. government charged three other banks and eight traders with “spoofing” the monetary metals futures markets. The banks paid $47 million in fines:

Also in January GATA published the price discounts given by CME Group, operator of the major futures exchanges in the United States, to governments and central banks for secretly trading ALL major futures contracts in the country — not just monetary metals futures, whose trading discounts are highlighted in the red box on the screen, but even agricultural futures:

Have you ever seen mainstream financial news organizations report that governments and central banks get discounts for secretly trading all major futures contracts in the United States, even cattle futures?

CME Group’s filings with the U.S. Securities and Exchange Commission and the Commodities Futures Trading Commission acknowledge that its clients include governments and central banks, but otherwise this surreptitious trading is a state secret preserved by our timid press…

This is the speech that GATA secretary/treasurer Chris Powell gave at the New Orleans Investment Conference on Friday — and it’s certainly worth your while if you have the time for it.  Another link to it is here


The PHOTOS and the FUNNIES

I was going to continue with the award-winning photo series that I started in my Friday column, but reader Richard McVay sent me a photo that changed my mind.  This ‘critter’ is commonly called the ‘peacock spider‘…a species of jumping spider only found in Australia, which is a pity.  These spiders are so named due to the males’ colorful and usually iridescent patterns on the upper surface of the abdomen often enhanced with lateral flaps or bristles, which they display during courtship.  Females lack these bright colors, being cryptic in appearance. Depth-of-field is a major issue at these micro distances…measured in millimetres — and my hat is off to the photographers that took these shots. Click to enlarge.


The WRAP

I don’t know why today’s pop ‘blast from the past’ popped into my head about fifteen minutes ago, but it did — and totally out of the blue…so it made today’s selection easy.  This dates from 1957 — and I was 9 years young at the time.  This singer, with a velvet voice, is world-renown — and was born in Gilmer, Texas, on September 30, 1935.  This song came in as #14 on Billboard’s Top 100 tunes of that year.  It’s a classic…timeless…and it’s been decades since I’ve heard it played anywhere.  The link is here.

Today’s classical ‘blast’ from the past is somewhat more ancient, of course.  The Nocturnes, Op. 9 are a set of three nocturnes written by Frédéric Chopin between 1830 and 1832, published that year, and dedicated to Madame Marie Pleyel. The second nocturne of the work is regarded as Chopin’s most famous piece.  If you haven’t heard this work before, you just gotta get out more!  Ukrainian-born Valentina Lisitsa does the honours — and the link is here.


It was a very subdued trading session as far as gold and silver prices were concerned on Friday, with no hint of follow-through from Thursday’s big up day in all four precious metals.  That’s somewhat of a surprise, as even though the dollar index rallied in morning trading in New York yesterday, there was little hint of that in the price paths of either silver or gold during that time period.  And on top of that, there was blow-out volume in silver…97,000 contracts on a net basis — and with only 9 cents difference between silver’s high and low ticks in the December contract, you have to wonder what that was all about. Friday’s Preliminary Report above showed no change [14 contracts] in silver’s total open interest.  Hopefully something will be revealed in next Friday’s COT report.

Here are the 6-month charts for the Big 6 commodities.  Gold and silver weren’t allowed to do anything, but platinum and palladium are being allowed to rally…but not by too much each day.  Copper broke above its 50-day moving averages yesterday, so the commercial traders are harvesting the brain-dead Managed Money in that commodity.  WTIC took another hit on Friday — and it’s getting seriously oversold, so it’s time for the commercials to rake in big profits from the Managed Money traders there as well.  Today, the ‘click to enlarge‘ feature only helps with the four precious metal charts.

Just about everything that involves the deep state outside the U.S. appears to have ground to a halt in light of the mid-term elections coming up on Tuesday — and I’m certainly not going to speculate on how the precious metals will ‘react’ to election night news…but presume they’ll ‘react’ the way that the powers-that-be want them to.

But underneath all this is a world wide economic debacle that’s coming to a rolling boil — and it will be interesting to see if this newly-floated U.S. trade deal with China will amount to anything, or is it just an election ploy?  The internal structures of most of the world’s equity markets are now broken beyond repair — and it’s only through the efforts of the PPT and the hedge fund community…that’s hemorrhaging cash from all pores…that’s keeping things on what appears to be an even keel.  But out of sight, the situation is hopeless — and it remains to be seen whether this whole edifice crashes and burns all in one go, or dies a death by a thousand cuts.  It also remains to be seen if the world’s central banks will do anything as these financial and economic events unfold — and if they do make the effort…will it matter?

Since Nixon ripped the world of the gold standard in August 1971…it’s only been a matter of when, not if, this now-Frankenstein financial system — and the economies on which it was built, breaths is last.  As far as I’m concerned we’re well past the “best before” date on all this.

And despite the fact that precious metal prices — and their associated equities, are not doing what you and I want them to…our day is still coming.  All that matters now, is when it’s best for JPMorgan, or when they’re told to step aside and let the precious metals market clear.

And from a purely COMEX perspective, we’re still on the launch pad, as the market structure is still very bullish.

So we wait some more.

I’m done for the day — and the week — and I’ll see you here on Tuesday.

Ed