06 December 2018 — Thursday
YESTERDAY in GOLD, SILVER, PLATINUM and PALLADIUM
With most of the U.S. markets closed on Wednesday, there wasn’t much happening in gold. It was sold quietly lower in Far East trading on their Wednesday morning — and then from 1 p.m. China Standard Time until the London open, the gold price traded flat. From that point, it rallied quietly and unevenly higher — and both attempts to break above the unchanged mark in New York were quietly turned lower.
The low and high ticks definitely aren’t worth looking up.
Gold finished the Wednesday session in New York at $1,236.70 spot, down $1.30 on the day. Net volume was very quiet at 97,500 contracts — and roll-over/switch volume was equally quiet at just 3,388 contracts.
Silver’s price path was almost identical to gold’s…including the quiet sell-offs during the New York session on both attempt to break above the unchanged mark.
The low and high ticks in this precious metal aren’t worth looking up, either.
Silver was closed in New York yesterday at $14.46 spot, down 4.5 cents on the day. Net HFT silver volume was also very quiet at a hair under 29,000 contracts — and roll-over/switch volume in this precious metal only amounted to 1,160 contracts.
As with gold and silver, the platinum price began to head lower about an hour after trading began at 6:00 p.m. EST on Tuesday evening. The Far East low was set shortly before noon China Standard Time on their Wednesday morning — and then began to crawl higher starting a bit over an hour later. That ran out of gas a few minutes after 12 o’clock noon in Zurich — and it traded flat from there until the COMEX open. Then down it went. This sell-off lasted until shortly before Zurich closed — and then away it went to the upside. A willing seller appeared at 1 p.m. EST — and prevented the platinum price from breaking above unchanged — and it didn’t do much after that. Platinum finished the Wednesday session at $799 spot, down 3 dollars from Tuesday’s close.
The palladium price was down about five bucks by 1 p.m. CST on their Wednesday afternoon — and then didn’t do much of anything until shortly after Zurich opened. It took off higher from that juncture — and was up about 15 dollars less than thirty minutes later. It chopped unevenly sideways from there — and the $1,243 spot high tick appeared to come minutes after 9 a.m. EST. But then selling pressure appeared — and by the time it was finished around 2:30 p.m. EST, all of Wednesday’s gains had vanished — and palladium was closed at unchanged on the day at $1,226 spot.
For a decent part of the Wednesday trading session, the palladium price was trading higher than the gold price.
The dollar index dipped a few basis points during the first hour of trading once it began at 6:00 p.m. EST on Tuesday evening in New York, but at 9 a.m. CST it began to head higher. That lasted until the 2:15 p.m. afternoon gold fix in Shanghai. It edged lower from the there — and once it touched the unchanged mark around 8:50 a.m. in London, it appeared to get rescued by the usual ‘gentle hands’. It crawled quietly but unevenly higher from there until a few minutes before 11 a.m. GMT — and then began to head sharply lower. The 96.84 low tick was set about thirty minutes later — and then didn’t do much of anything until about 9:05 a.m. EST. It began to rally a bit from there — and the 97.19 high tick of the day was set right at the afternoon gold fix in London, which was 10 a.m. in New York. However, by 12:25 p.m. EST, it was back below unchanged by a few basis points once again — and from that juncture it rallied unevenly higher until around 3:40 p.m. — and it crawled lower into the close from there. The dollar index finished the Wednesday session at 97.00…up 4 basis points on the day.
The folks at the ino.com Internet site still haven’t fixed their intraday dollar index chart, so you’re stuck with this marketwatch.com version again. Click to enlarge.
And with the New York markets shut tight yesterday, I didn’t expect reports of any kind. How wrong I was!
On a whim, less than an hour before I normally post my daily column, I though I’d check to see if there was a Daily Delivery Report posted for Wednesday — and there was…plus more! For Day 5 of the December delivery month, there were 1,150 gold and 173 silver contracts posted for delivery on Friday.
In gold, the only two short/issuers that mattered were JPMorgan and HSBC USA, with 821 and 320 contracts out of their respective in-house/proprietary trading accounts. The three largest long/stoppers of the ten on the list, were Goldman Sachs with 713 contracts for its own account once again — and in second and third spots were JPMorgan and HSBC USA with 249 and 78 contracts for their respective client accounts.
In silver, of the four short/issuers in total, the biggest was ABN Amro with 111 contracts from its client account — and in second and third place were Advantage and JPMorgan with 31 and 30 contracts respectively. Both of these amounts were from their respective client accounts. There were six long/stoppers in total — and the biggest by far once again was JPMorgan with 115 contracts…87 for its client account, along with 28 for its own account. In distant second place was Advantage with 35 contracts for its client account.
The link to yesterday’s Issuers and Stoppers Report is here.
The CME Preliminary Report for the Wednesday trading session showed that gold open interest in December fell by 97 contracts, leaving 3,465 still open, minus the 1,150 contracts mentioned a few paragraphs ago. Tuesday’s Daily Delivery Report showed that 73 gold contract were actually posted for delivery today, so that means that 97-73=24 more gold contracts vanished from the December delivery month. Silver o.i. in December declined by 189 contracts, leaving 787 still around, minus the 173 contracts mentioned in the above Wednesday Daily Delivery Report. Tuesday’s Daily Delivery Report showed that 245 silver contracts were actually posted for delivery today, so that means that 245-189=56 more silver contracts just got added to December.
There was no sales report from the U.S. Mint — and there were no changes in GLD or SLV, either.
There was no gold activity over at the COMEX-approved depositories on the U.S. east coast on Tuesday.
But that wasn’t the case in silver, as 1,208,092 troy ounces were reported received, but only 51,587 troy ounces were shipped out. In the ‘in’ category, there was one truckload…607,046 troy ounces…dropped off at CNT — and the other truckload…601,046 troy ounces, found a home over at Canada’s Scotiabank. In the ‘out’ category, there was 48,585 troy ounces shipped out of the International Depository Services of Delaware — and the remaining 3,002 troy ounces departed Delaware. There was also a paper transfer from the Eligible category and into registered over at CNT…96,815 troy ounces worth — and that’s most likely destined for delivery in December. The link to that activity is here.
There was a bit of movement over at the COMEX-approved gold kilobar depositories in Hong Kong on their Tuesday. The received 630 of them — and shipped out 600. All this occurred at Brink’s, Inc. — and the link to that, in troy ounces, is here.
The Preslav Treasure was found in autumn of 1978 at the vineyard in Castana, 3 km to the north – west of the second Bulgarian capital – Veliki Preslav. The excavations that followed revealed more than 170 golden, silver and bronze objects including 15 silver Byzantine coins belonging to Constantine VII, Romanos II (945 and 959) and other artifacts dating far back to the period between 3rd and 7th centuries.
The owner of the necklace was probably under the protection of Virgin Mary, who is portrayed on both central medallions. It is possible that Peter I of Bulgaria gave this beautiful jewelry as a wedding gift to his bride, Irene Lekapene, the Byzantine princess, in 927 in Constantinople. It is assumed that the necklace was a wedding present because the images of water-birds symbolize family happiness and fidelity. Click to enlarge.
I only have a tiny handful of stories for you today.
Well, it didn’t take investors long…
In less than 24 hours, they figured out that the trade war was fake and the “incredible” deal between President T. and the Chinese at the G20 summit was fake, too. JPMorgan commented:
It doesn’t seem like anything was actually agreed to at the dinner, and White House officials are contorting themselves into pretzels to reconcile Trump’s tweets (which seem, if not completely fabricated, then grossly exaggerated) with reality.
The yield curve flattened on Monday as well (more in today’s Market Insight), signaling another wide divide between the “booming” economy advertised by Wall Street and the sluggish reality on Main Street.
Stocks fell, with the Dow down nearly 800 points by the close of day.
But there’s a long way to go. Our guess is that another 10,000 points will have to be lopped off before the pruning is complete.
This commentary by Bill put in an appearance on the bonnerandpartners.com Internet site early on Wednesday morning EST — and another link to it is here.
Mere hours after Chinese officials finally affirmed President Trump’s description of Saturday’s trade ‘truce’ – this after fears that the true nature of the agreement might have been “lost in translation” helped trigger the worst one-day market selloff since October – the DOJ has gone ahead and kicked the hornet’s nest, seriously jeopardizing the prospects for a prolonged trade detente between the world’s two biggest economies.
Canada’s Globe and Mail reported late on Wednesday that on December 1 – on the same day as the Trump-Xi dinner – Canadian authorities arrested Wanzhou Meng, the CFO of Huawei Technologies and daughter of the telecom giant’s founder, Ren Zhengfei. An ex-officer with the People’s Liberation Army, Ren is one of the country’s most revered business figures.
“Wanzhou Meng was arrested in Vancouver on December 1. She is sought for extradition by the United States, and a bail hearing has been set for Friday,” Justice department Ian McLeod said in a statement to The Globe and Mail. “As there is a publication ban in effect, we cannot provide any further detail at this time. The ban was sought by Ms. Meng.
Meng is said to be a “rising star” at Shenzhen-based Huawei, the world’s second-largest maker of telecommunications equipment. Reuters reported in 2013 that Ms. Meng served on the board of a Hong Kong-based Skycom Tech that later attempted to sell embargoed Hewitt Packard computer equipment to Iran’s largest mobile-phone operator. At least 13 pages of the Skycom proposal were marked “Huawei confidential” and carried Huawei’s logo. Huawei has said neither it nor Skycom ultimately provided the HP equipment. HP said it prohibits the sale of its products to Iran.
The CFO is now facing extradition to the U.S. on suspicions that she violated U.S. sanctions against Iran (allegations that nearly resulted in a devastating Treasury “death sentence” earlier this year for Huawei rival ZTE).
We haven’t heard the last of this, I’m sure. This Zero Hedge article was posted on their website at 5:23 p.m. EST on Wednesday afternoon — and another link to it is here. A parallel ZH story is headlined “Carnage Continues: U.S. Futures Crash at Re-Open After Huawei CFO Arrest“. Then this ZH story at 11:04 p.m. EST last night…”China Outraged At Arrest Of Huawei CFO, Warns It Will “Take All Measures””
* Implications of the USMCA between the US, Canada, and Mexico
* The importance of Robert Lighthizer’s role in US trade negotiations
* Update on tensions between Russia and Ukraine
* Russia’s “buffer states” of outlying countries
* How Russia’s gas pipelines running through Ukraine are critical infrastructure
* Why Russia purchasing close to 30 tons of gold per month is a strategic move
* How a decentralized permissioned ledger cryptocurrency sponsored by Russia and or China and settled in physical gold could be the next system used by sovereigns to settle net trade balances without using the US dollar
* Why Switzerland could be an ideal location to settle net payments in gold
* Update on Saudi Arabia stability, succession, and world relations
* Thoughts on the G20 upcoming meetings and trade negotiations
* Update on Fed monetary policy and interest rates
This 59-minute video Q&A was posted on the youtube.com Internet site on December 1 — and I thank Harold Jacobsen for bringing it to our attention. Another link to it is here.
The PHOTOS and the FUNNIES
Today’s first photo is another one from the Siena International Photo Awards — and was taken by Khaichuin Sim in Masai Mara National Park in Kenya. “I was taking an early ride out from the camp, searching for the Great Migration, when I saw a rhino from far away standing beside a tree. The backlight from the early sun was too strong, so I took a silhouette instead.” Click to enlarge.
This second photo from the same series was taken by Italian photographer Jacopo Rigotti. “Looking, as usual, for the nests of the most beautiful bird species in Trentino, I unexpectedly saw this hoopoe and I immediately grasped the opportunity to photograph it.” Click to enlarge.
Even though most of the U.S. markets were closed on Wednesday, the COMEX was open — and ‘da boyz’ made damn sure that gold, silver and platinum were all finished down on the day — and that was obvious in the last thirty minutes of trading before the COMEX close. Even palladium, which was up about $17 at its high, was closed back at unchanged.
Of course with fumes and vapours for volume, it was easy for anyone with an agenda to move prices whichever way they wanted — and they did precisely that.
With the markets closed, there are no ‘almost 1-year’ charts for you to look at. Wednesday’s price/volume action will be included with Thursday’s.
And as I type this paragraph, the London open is less than ten minutes away — and I note that the gold price crawled unsteadily higher until around 10:30 a.m. China Standard Time on their Thursday morning — and then didn’t do much until just before, or at, the afternoon gold fix in Shanghai. It was sold down at that point — and the price is currently lower by $2.30 the ounce. The silver price traded mostly at unchanged or a few pennies lower until 2 p.m. CST — and then it got the same treatment as gold. It’s down 12 cents. The platinum price didn’t do much until shortly after 9 a.m. CST — and it was sold unevenly lower from there — and is down 8 bucks at the moment. Palladium was up 4 dollars until around 1:30 p.m. China Standard Time — and it was sold down as well — and is down 3 bucks currently.
Net HFT gold volume is coming up on 47,000 contracts — and there’s only 528 contracts worth of roll-over/switch volume in this precious metal. Net HFT silver volume is coming up on 10,500 contracts — and there’s only 111 contracts worth of roll-over/switch volume on top of that.
The dollar index didn’t do much of anything once trading began at 6:00 p.m. EST in New York on Wednesday evening. But the moment it sank back to the unchanged mark around 1:15 p.m. CST on their Thursday afternoon, a ‘rally’ got under way — and the dollar index is now up 13 basis points — and off its current high tick by a bit.
I’m posting today’s column on the website a bit later than normal because I had to write up the reports from New York, which I discovered at the last possible moment — and had no time left to write it up before my normal 4:02 a.m. EST filing time. That makes the e-mail version of my column about thirty minutes later than normal
After one hour of trading in London and Zurich, I see that the gold price has ticked off its current London opening low — and is down only 70 cents at the moment. Silver is off its current low tick by a few pennies — and is down 10 cents currently. Platinum is down 7 dollars — and the palladium price was absolutely slaughtered at the Zurich open…punched back below $1,200 spot briefly…but is off that low by a bit, but still down 21 dollars.
Gross gold volume is about pretty chunky already at 55,500 contracts — and minus what little roll-over/switch volume there is, net HFT gold volume is around 54,400 contracts. Net HFT silver volume is up there as well at about 13,800 contracts — and there’s only 297 contracts worth of roll-over/switch volume in that precious metal.
The dollar index is chopping sideways — and is up 14 basis points as of 8:50 a.m. GMT in London…9:50 a.m. CET in Zurich.
I’m done for the day — and I’ll see you here tomorrow.