Another Yawner of a Day in Silver and Gold

25 January 2019 — Friday

YESTERDAY in GOLD, SILVER, PLATINUM and PALLADIUM


Despite the squiggles on the Kitco gold chart below, it was another ‘nothing’ sort of price day — and with extremely low volumes once again.  Gold’s high on Thursday came shortly before 10 a.m. China Standard Time on their Thursday morning — and it was sold quietly lower from there.  There was a sharp down tick at the COMEX open — and then it ‘rallied’ back to a bit above unchanged by the afternoon gold fix in London.  It was sold quietly and unsteadily lower from there until around 2:30 p.m. in the very thinly-traded after-hours market — and ticked about a dollar higher going into the 5:00 p.m. EST close.  Nothing to see here.

Once again, the high and low ticks aren’t worth mentioning.

Gold finished the Thursday session in New York at $1,280.60 spot, down $1.70 on the day.  Net volume was very light once again at just over 145,000 contracts — and roll-over/switch volume was very heavy at just under 81,000 contracts.

Silver traded well within a fifteen cent price range on Thursday, with a price pattern nearly identical to that of gold’s…so I shall dispense with the play-by-play on it.

Of course the high and lows aren’t worth looking up, either.

Silver closed on Thursday at $15.295 spot, down 4.5 cents from Wednesday.  Net volume was very quiet at a hair under 45,500 contracts — and there was 2,357 contracts worth of roll-over/switch volume in this precious metal.

The platinum price didn’t do much of anything in Far East trading on their Thursday.  But about fifteen minutes before the Zurich open, it began to edge very quietly lower until around noon CET.  From that point, it traded flat until shortly before 9 a.m. in New York — and then took off to the upside.  That lasted until about 9:40 a.m. EST — and the high tick of the day came shortly before noon in New York — and it didn’t do much of anything after that.  Platinum closed in New York yesterday at $801 spot, up 8 bucks on the day.

The palladium price chopped quietly sideways in Far East trading yesterday, but began to head lower starting around 1 p.m. in Zurich.  When the COMEX opened, it really got kicked downstairs, with the low tick coming shortly before 9:30 a.m. in New York.  It struggled quietly and unevenly higher from there — and finished the Thursday session at $1,303 spot, down 27 dollars from Wednesday’s close.

The dollar index closed very late on Wednesday afternoon in New York at 96.12 — and then dropped 5 basis points the moment that trading began at 7:45 p.m. EST on Wednesday evening.  It crawled very quietly higher from there until the 2:15 p.m. China Standard Time afternoon gold fix in Shanghai — and then really began to rally from there.  That lasted until 8:30 a.m. in New York — and then down it went.  The New York low tick came at precisely 10:00 a.m. EST…which was the afternoon gold fix in London.  It began to ‘rally’ anew from that juncture — and that lasted until 12:25 p.m. EST.  It didn’t do much from there until around 2:15 p.m. — and it was sold a bit lower from there into the close.  The dollar index finished the Thursday session at 96.60…up 48 basis points on the day.

Considering the rise in the dollar index yesterday, I’m somewhat surprised that gold and silver prices did as well as they did.

Here’s the DXY chart, courtesy of Bloomberg once again.  Click to enlarge.

And here’s the 6-month U.S. dollar index chart courtesy of stockcharts.com — and the delta between its close…96.30…and the close on the DXY above, was 30 basis points on Thursday.  Click to enlarge.

The gold shares opened unchanged — and then began to head very quietly and unsteadily higher.  That lasted until precisely noon in New York trading.  They fell down a bit from there until shortly before 1 p.m. EST — and edged extremely quietly higher into the 4:00 p.m. close from there.  The HUI finished up 0.63 percent.

The silver equities opened a hair below unchanged, but then quickly rallied — and proceeded to follow the same price path as the gold stocks…complete with their noon EST high ticks.  They began to fade a bit from that point, but began to crawl higher staring around 2:45 p.m. in New York trading.  Nick Laird’s Intraday Silver Sentiment/Silver 7 Index closed higher by 1.39 percent.  Click to enlarge if necessary.

Here’s Nick’s 1-year Silver Sentiment/Silver 7 Index chart as well.  Click to enlarge.

The CME Daily Delivery Report showed that only 5 gold and 3 silver contracts were posted for delivery within the COMEX-approved depositories on Monday.  In gold, the biggest short/issuer was HSBC USA with 4 contracts.  The two largest long/stoppers were Advantage and JPMorgan, with 2 contracts each.  All issuer and stopper transactions involved their respective client accounts.  In silver, the amounts are too tiny to break down, but if you wish to see them, 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 January declined by 3 contracts, leaving 53 still around, minus the 5 mentioned just above.  Wednesday’s Daily Delivery Report showed that 4 gold contracts were actually posted for delivery today, so that means that 4-3=1 more gold contract just got added to the January delivery month.  Silver o.i. in January fell by 3 contracts, leaving 356 still open, minus the 3 contracts mentioned in the previous paragraph.  Wednesday’s Daily Delivery Report showed that 4 silver contracts were posted for delivery today, so that means that 4-3=1 more silver contract was added to January.


There were no reported changes in either GLD or SLV on Thursday.

And there was no sales report from the U.S. Mint, either.

There was no in/out movement in gold over at the COMEX-approved depositories on the U.S. east coast on Wednesday.  There was a bit of gold transferred from the Registered category — and back into Eligible involving three different depositories.  But the total amount is so small…1,794 troy ounces…that they aren’t worth breaking down…or linking.

There was pretty big moment in silver once again, as 1,025,226 troy ounces was received — and 919,301 troy ounces were shipped out.  All of the ‘in’ activity was at HSBC USA — and in the ‘out’ category, there was 805,902 troy ounces that departed CNT — and the 113,398 troy ounces was shipped out of HSBC USA.  There was also 564,937 troy ounces transferred from the Registered category and back into Eligible.  This involved four different depositories — and if you wish to know which ones — and how much — the link to all that activity is here.

There was a very decent amount of activity [for the second day in a row] over at the COMEX-approved gold kilobar depositories in Hong Kong on their Wednesday.  They reported receiving 5,000 of them — and shipped out 451.  All of this occurred at Brink’s, Inc. — and the link to that, in troy ounces, is here.


Here are two charts that I just got from Nick Laird late last night.  They show India’s gold and silver imports, updated with November’s dataDuring the month they imported 70.48 tonnes of gold — and 827.6 tonnes of silver.   That’s 2.27 million troy ounces of gold — and a chunky 26.61 million troy ounces of silver.  That’s a lot of silver!  Click to enlarge for both charts.

India has certainly have been importing silver hand over fist for the last three months.


The Coggalbeg hoard is an Early Bronze Age hoard of gold work jewellery dating to 4300–4000 B.P. [Before Present]. It was found in a bog at Coggalbeg, County Roscommon, Ireland in 1945, and consists of a gold lunula (a crescent shaped “little moon”) and two small gold discs, of a type known from other examples, decorated with a cross motif within two circles. The pieces are flat and thin, and collectively weigh under 78 grams (2.8 oz), indicating that they were probably intended as part of a necklace.

The hoard was discovered in 1945 by Hubert Lannon while cutting turf on his bog in Roscommon. From 1947, it was kept in a safe at Sheehan’s Chemists in Strokestown, during which time it was only seen by members of the Sheehan family. Following a break-in at the pharmacy, in which the safe was stolen, the objects were found by the Garda Síochána (Irish police) wrapped in paper in a rubbish skip in April 2009. Due to its lightness in weight, police believe that the thieves were primarily interested in cash and were not aware of the objects’ presence in the discarded loot.  Click to enlarge.

It was another very quiet news day — and I only have a small handful of items for you once again.


CRITICAL READS

Venezuela’s Great Dream Was Always a Scam… — Bill Bonner

“Soldiers revolt…”

“Millions on verge of starvation…”

“Biggest mass exodus in history of the Americas…”

What a glorious show! Right before our eyes… a real-life, real-time experiment…
…all the conceits… the pretensions… the balderdash… the claptrap…

…all laid out for the world to see. And now, stretched out in front of us like a drug dealer in the morgue, is a Great Dream busted up so thoroughly that there can be no doubt – it was a scam from the get-go.

You put a pot on the burner. Eventually, it boils. And Caracas was boiling last night. Earlier in the day, a direct challenge to Nicolás Maduro’s presidency. Juan Guaidó – president of Venezuela’s National Assembly – declared himself the legitimate president of the country.

This interesting commentary from Bill put in an appearance on the bonnerandpartners.com Internet site early on Thursday morning EST — and another link to it is here.


Washington Has Appointed a President For Venezuela — Paul Craig Roberts

After listening since 2016 to the American presstitutes complain, without providing a mere scrap of evidence, of Russia meddling in U.S. elections, a person would think that the last thing Washington would do would be to meddle in other countries’ elections.

Unfortunately, that is not the case. Washington routinely meddles but now has gone far beyond mere meddling. Washington has this day (January 23, 2019) declared that the elected president of Venezuela, Nicolas Maduro, is no longer the Venezuelan president. Washington, not the Venezulan people, has decided who is Venezuela’s president. Declaring the elected government to be “illegitimate,” President Trump elected by diktat the Venezuelan president: “Today, I am officially recognizing the President of the Venezuelan National Assembly, Juan Guaido, as the Interim President of Venezuela.”

Clearly, Gaido is in Washington’s pocket or Washington would not have chosen him.

Maduro, like Chavez before him, has committed the unpardonable crime of representing the Venezuelan people instead of American corporate and financial interests. Washington simply does not tolerate Latin American governments that represent Latin American people. As U.S. Marine General Smedley Buttler said, he and his Marines made Latin America safe for the United Fruit Company and investments by U.S. banks.

This commentary by Paul was posted on his Internet site on Wednesday sometime — and the first person through the door with this story was Larry Galearis.  Another link to it is here.


China Joins Russia in Slamming U.S. Interference in Venezuela

Back in March, we asked a simple question: Can Russia & China Rescue Venezuela?

Realistically, and in retrospect, the answer was always no, but the reason we asked the question was simple: both China and Russia have extended massive credits to Caracas, and Maduro’s regime in particular. As such, letting the country “die” was never an option that either Beijing or Moscow would gladly accept; neither was it an option to allow a transition in Venezuela’s top power echelons, one which replaces the pro-Russia and China Maduro regime, with another regime which would, supposedly, be supported and endorsed by the U.S., and thus jeopardize Venezuela’s obligations to the two nations.

And, as we also said last March, “chances are that Washington is aware of the role that China and Russia play there. Otherwise [Washington] would have already gone ahead with the broad oil sanctions, despite potential headaches for U.S. refineries.”

Ten months later, something changed and whether due to Trump’s urge to once again deflect attention from the domestic political chaos surrounding the government shutdown, Trump decided to escalate his long-running feud with Venezuelan President Nicolas Maduro, who on Wednesday announced cutting diplomatic ties with the U.S. after opposition leader Juan Guaidó declared himself the country’s interim president and Trump formally stated his recognition of Guaidó.

In other words, currently, there are “two regimes” coexisting in Venezuela, which brings severe risk of political turmoil.

The quick U.S. recognition led nations of the Lima Group to imitate and recognize the Venezuelan opposition regime. Nonetheless the country’s Defense Minister Vladimir Padrino López refused to recognize Guaidó, saying the military will defend the constitution and sovereignty.

This news item showed up on the Zero Hedge website at 3:07 p.m. on Thursday afternoon EDT — and it comes to us courtesy of Brad Robertson.  Another link to it is here.


Is Your Money Manager Really Listening? — Dennis Miller

No one cares as much about your money as you do! If a money manager doesn’t perform, they lose a client – you lose your money!

Most money managers have a genuine concern for their clients however, they can make mistakes.

One of the worst mistakes is not listening and understanding the needs those nearing retirement.

In response to our article, “When The Music Stops, Who Gets Stuck With The Bad Loans?”, reader Rick G. wrote:

…. My former money manager had several individual bonds in my portfolio. I looked at them and many don’t pay a rate more than a 2-3 year CD, with much more risk.

…several of these are BBB rated…. I don’t trust the bond-rating agency given what happened in 2008. I also don’t trust the insurance companies that are supposedly insuring these bonds against default.”

This longish commentary from Dennis appeared on his Internet site on Thursday morning — and another link to it is here.


Mario Draghi Sounds Economic Alarm for the Euro-Area

Mario Draghi intensified his warning on the challenges facing the euro-area economy, signaling the European Central Bank could be even more cautious about any withdrawal of crisis-era stimulus this year.

After holding off in December from fully downgrading his assessment, the ECB president finally caved on Thursday by saying the risks to growth “have moved to the downside.” That’s a significant change from six weeks ago, when he described the risks as “broadly balanced” and capped monetary support.

The Governing Council is getting increasingly concerned about emerging weakness in the euro area. It confirms that the first rate hike is unlikely to take place before December and that ECB forecasts will be revised down in March.

The euro briefly dropped to its lowest level of the year before recovering after Draghi signaled that there’s no case yet for a new round of long-term loans for banks — a move which could be seen as monetary easing. The single currency was down 0.2 percent on the day at $1.1361 at 3:18 p.m. Frankfurt time.

This Bloomberg story appeared on their Internet site at 5:47 a.m. Pacific Standard Time on Thursday morning — and was updated about thirty minutes later.  I found it in today’s edition of the King Report — and another link to it is here.


IMF fears political rage will block rescue by Fed in next crisis — Ambrose Evans-Pritchard

The International Monetary Fund has warned that the system of global cooperation that saved world finance in the 2008 crisis may break down if there is another major shock or a deep recession.

David Lipton, the IMF’s second-highest official, said it is unclear whether the U.S. Federal Reserve would again be able to extend $1 trillion of dollar “swap lines” to fellow central banks — the critical measure that halted a dangerous chain-reaction after the collapse of Lehman Brothers and AIG.

I fear that if at any time we have a worse than garden variety recession there will be anger and limitations in the way governments can respond,” he told a group at the World Economic Forum in Davos today.

If there is a substantial crisis we may need central banks to act again in an extraordinary way. For the Fed this requires a fiscal backstop from the U.S. Treasury, and at the beginning there may be some reluctance. I wonder whether they will be so willing to extend the swap lines,” Mr Lipton said.

It is a polite way of saying that the Trump administration might ask why it should “bail out” the Europeans who have been less than friendly to this White House, and why they should rescue the rest of the world. By the time the explosive consequences became clear it would be too late.

This very worthwhile commentary from Ambrose was posted in the clear in a GATA dispatch posted on their Internet site on Thursday evening — and another link to it is here.


Australia’s ANZ bank closes Singapore gold vault

Australia and New Zealand Banking Group Ltd (ANZ), whose gold bullion business is one of Asia’s largest, said on Thursday it was closing its precious metals vault in Singapore.

The move follows the bank’s sale last year of its stake in an exchange-traded fund backed by physical gold and sources say it is part of a scaling back of ANZ’s precious metals business.
The bank opened the vault — which could hold 50 tonnes of gold worth around $2 billion at current prices — in 2013. That year, ANZ said it distributed close to 15 percent of the world’s primary gold production.

ANZ has suspended its physical precious metals custody service as it does not align to our business strategy at this time,” a spokesman for the bank told Reuters.

This is a very small change in our precious metals and commodities business, which remains more broadly an important part of the ANZ Markets business,” the spokesman said.

Industry sources say precious metals account for the bulk of revenues at ANZ’s commodities division estimated at $50-80 million a year.

This interesting Reuters story, filed from London, was posted on their website at 6:50 a.m. GMT on Thursday morning, which was 1:50 a.m. in New York…EST plus 5 hours.  I found it on the Sharps Pixley website yesterday evening.  Another link to it is here.


The PHOTOS and the FUNNIES

This sequence of photos is also from The Guardian — and also courtesy of Patricia Caulfield.  This series is headlined “The best of 2018 wildlife photography awards“.

This first shot is entitled:  “Mother Defender” and was taken by Javier Aznar González de Rueda.  The caption reads: “A large Alchisme treehopper guards her family as the nymphs feed on the stem of a nightshade plant in El Jardín de los Sueños reserve in Ecuador. Unlike many treehoppers, which enlist the help of other insects (mostly ants), families of this species are guarded by the mother alone. She lays her eggs on the underside of a nightshade leaf, covers them with a thin secretion and then shields the clutch with her tiny frame.”  Click to enlarge.

This second shot is entitled:  “Meet Bob” — and was taken by Jasper Doest.  The caption reads: “Bob is a Caribbean flamingo from the Dutch island of Curaçao. Bob sits in Odette’s lap as she drives him around the island promoting the work of FDOC, a wildlife rehabilitation centre. Bob had probably been kept captive on concrete, as he had developed bumble foot – a condition that causes painful lesions and growths under a bird’s feet – and was habituated to humans, so he could not be returned to the wild.”  Click to enlarge.


The WRAP

It was another yawner of a day in gold and silver on Thursday…no price activity worthy of the name…low net volume — and high roll-over/switch volume once again.  I was somewhat surprised that silver and gold did as well as they did considering the strength in the U.S. dollar index.

But the February delivery month in gold is now coming up hard, so I expect roll-over/switch volume to intensify further between now and First Day Notice.  All the large traders that aren’t standing for delivery next month, have to roll or sell their February contracts by the close of COMEX trading next Tuesday — and the rest of the traders that aren’t standing for delivery next month, have to be out of the February COMEX futures contracts by the close of COMEX trading on the following day…Wednesday.  First Day Notice numbers for delivery into the February contract will be posted on the CME’s website around midnight on Wednesday evening — and I’ll have them for you in Thursday’s column.

Here are the 6-month charts for the Big 6 commodities — and except for palladium, there isn’t much to see.  Click to enlarge for all.

And as I type this paragraph, the London open is less than ten minutes away — and I note that the gold price chopped sideways until 10 a.m. China Standard Time on their Friday morning — and began to crawl unsteadily higher from there.  At the moment, it’s up $3.50 an ounce.  The silver price followed the same wobbly price path — and is up 8 cents currently.   Platinum has been chopping quietly but unevenly sideways all through Far East trading — and it’s up 2 dollars.  It was about the same for palladium — and it’s up a buck as the Zurich open looms.

Net HFT gold volume is exceptionally light at a bit over 22,000 contracts — and there’s about 14,600 contracts worth of roll-over/switch volume in that precious metal.  Net HFT silver volume is 7,900 contracts — and there’s only 336 contracts worth of roll-over/switch volume on top of that.

The dollar index opened down about 12 basis points as soon as trading began at 7:45 p.m. EST in New York on Thursday evening…8:45 a.m. CST in Shanghai.  It dipped a bit more starting an hour later — and has been chopping quietly sideways since.  As of 7:45 a.m. GMT in London, it’s down 20 basis points.

With the February delivery month only a week away, I’ll be very  surprised if see any big price changes between now and then…especially to the upside…unless something comes along from out in left field.  If there are going to be any price surprises, I expect it would be to the downside.  But if the commercial traders were really serious, they would have started that engineered price decline long ago — and not left it to the very last minute…so to speak.

And as I post today’s column on the website at 4:02 a.m. EST, I note that the gold price hasn’t done much in the first hour of London trading — but is now up only $2.70 an ounce. Silver hasn’t done much, either — and is up 7 cents. Platinum is back at unchanged — and palladium is now down 2 dollars.

Gross gold volume is a bit over 62,000 contracts — and minus roll-over/switch volume, net HFT gold volume is just under 29,000 contracts. Net HFT silver volume is just under 9,700 contracts — and there’s 355 contract worth of roll-over/switch volume in this precious metal.

The dollar index continues to chop quietly sideways — and is down 17 basis points as of 8:45 a.m. GMT in London/9:45 a.m. CET in Zurich.

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

Ed