Another ‘Care & Maintenance’ Day in New York

23 August 2019 — Friday

YESTERDAY in GOLD, SILVER, PLATINUM and PALLADIUM


The gold price traded rather unevenly sideways once the market opened at 6:00 p.m. EDT in New York on Wednesday evening.  That lasted until shortly after the London open — and it was sold lower until around 12:35 a.m. BST.  Then at 1:00 p.m. BST/8 a.m. in New York, it began to head sharply higher, with the high tick of the day coming at the 10 a.m. EDT afternoon gold fix in London.  It was sold back below $1,500 spot in very short order — and it wasn’t allowed to do much after that.

It was the second day running that the gold price traded in a ten dollar price range, so I won’t bother with the low and high ticks again today.

Gold was closed in New York on Thursday at $1,497.50 spot, down $4.70 on the day.  Net volume was on the heavier side at a bit under 259,000 contracts — and there was a bit over 21,000 contracts worth of roll-over/switch volume on top of that.

It was almost the same price for silver, except its price path lower began shortly before the London open.  Its high tick also came at, or minutes before the afternoon gold fix in London…a high which it revisited minutes after the 11 a.m. EDT London close.  From that juncture it was sold quietly lower until trading ended at 5:00 p.m. in New York.  And it’s obvious from the Kitco chart that it was running into serious price resistance going into the fix.

The silver price traded in a one percent range for the entire Thursday session, so I shan’t bother with the low and high ticks in this precious metal, either.

Silver was closed at $17.005 spot, down 8 cents from Wednesday.  Net volume was pretty quiet at 38,000 contracts, but there was a hefty 33,500+ contracts worth of roll-over/switch volume out of September and into future months…mostly December.

The platinum price had a bit of a roller coaster ride lower to its low tick of the day, which came at 1 p.m. CEST in Zurich.  It then rallied in saw-tooth fashion into the afternoon gold fix, which proved to be its high of the day — and after a sharp down/up move going into the Zurich close, was capped at the $858 spot mark until 1 p.m. in New York — and was then guided a few dollars lower into the 5:00 p.m. EDT close.  Platinum was closed at $855 spot, up 4 dollars from Wednesday.

The palladium price sagged a bit in Far East trading on their Thursday — and was down about 11 dollars by around 1:40 p.m. in Shanghai.  It really didn’t do much of anything from that point, until it began to tick higher starting a few minutes after 1 p.m. in Zurich.  Its rally topped out shortly after 12 o’clock noon in New York — and the price crept a handful of dollars lower for the remainder of the day.  Palladium finished the Thursday session at $1,468 spot, up 15 bucks from its close on Wednesday.

The dollar index closed very late on Wednesday afternoon in New York at 98.30 — and opened down a bit more than 5 basis points once trading commenced at around 7:45 p.m. EDT on Wednesday evening.  From there, it didn’t do much until 8:10 a.m. in London.  Then there was an interesting four hour long down/up move that lasted until about 12:05 BST — and the 98.39 high tick was set at that point.  It was down hill from there until the 98.08 low tick was set around 8:55 a.m. in New York — and it certainly appeared as if the usual ‘gentle hands’ showed up at that point.  The index rallied back to almost the unchanged mark by around 10:30 a.m. EDT, but by 2:25 p.m. had given a decent chunk of that gain — and from there it crept a few basis points higher until trading ended at 5:30 p.m.  The dollar index finished the Thursday session at 98.17…down 13 basis points from Wednesday’s close.

Here’s the DXY chart for Thursday, courtesy of BloombergClick to enlarge.

And here’s the 6-month U.S. dollar index chart, courtesy of the folks over at the stockcharts.com Internet site.  The delta between its close…98.06…and the close on the DXY chart above, was 11 basis points on Thursday.  Click to enlarge as well.

The gold stocks opened about unchanged — and then rallied to their respective high ticks at, or just before, the afternoon gold fix in London.  About thirty minutes later they were at their lows of the day — and they chopped quietly and very unevenly sideways from that point until the markets closed at 4:00 p.m. in New York.  The HUI closed down 0.36 percent.

The silver equities followed the same up/down move in the first hour of trading that the gold shares did.  But from their lows, they bounced back into the green for most of the remainder of the day.  However, when silver was sold a bit lower starting around 3 p.m. EDT, the shares followed — and back into the red.  There was a sharp up move about fifteen minutes before trading ended — and it certainly looked as if the silver stocks were going to close in the green by a hair.  But what looked like a not-for-profit seller appeared minutes later — and took all that gain away.  Nick Laird’s Intraday Silver Sentiment/Silver 7 Index closed lower by 0.39 percent.  Click to enlarge if necessary.

And here’s Nick’s 1-year Silver Sentiment/Silver 7 Index chart, updated with Thursday’s doji.  Click to enlarge if necessary.

The CME Daily Delivery Report showed that 63 gold and zero silver contracts were posted for delivery within the COMEX-approved depositories on Monday.

In gold, of the three short/issuers in total, the only two that mattered were International F.C. Stone and Advantage, with 30 contracts each out of their respective client accounts.  There were four long/stoppers — and the three largest were Macquarie Futures, with 27 contracts for its own account — and in second place came JPMorgan, picking up 18 for its client account, plus 7 more for its in-house/proprietary trading account.  In third spot was Advantage, stopping 9 contracts for its client account.

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 August rose by another eye-opening amount…458 contracts, leaving 1,387 still around, minus the 63 contracts mentioned a few paragraphs ago.  Wednesday’s Daily Delivery Report showed that 45 gold contracts were actually posted for delivery today, so that means that 458+45=503 more gold contracts just got added to the August delivery month.  That’s a lot!  Silver o.i. in August declined by 1 contract, leaving zero left — and Wednesday’s Daily Delivery Report showed that this 1 lone silver contract is out for delivery today.

Along with the 1,387 gold contracts still outstanding in August, there are 2,236 ten-troy ounce COMEX mini gold contracts still open as well.  All of these contracts have to be settled by next Friday.


There was another decent amount of gold…94,395 troy ounces…deposited into GLD yesterday.  There was also another huge deposit into SLV, as an authorized participant added 3,695,715 troy ounces…six truckloads.

There was a tiny sales report from the U.S. Mint on Thursday.  They sold 500 troy ounces of gold eagles — and that was all.

There was some activity in gold over at the COMEX-approved depositories on the U.S. east coast on Wednesday.  There was 9,812 troy ounces received at Delaware — and that’s all the ‘in’ activity there was.  The only ‘out’ activity was 353.661 troy ounces/11 kilobars [SGE kilobar weight] that departed Brink’s, Inc.  [As I pointed out some months ago, Brink’s, Inc. has converted all their kilobar stock into the SGE weight, from the U.K./U.S. weight.  Both represent the same amount of gold, it’s just the way its being reported…32.151 troy ounces SGE weight/kilogram vs. 32.150 troy ounces U.K./U.S. per kilogram.]  There was also a tiny transfer of 398 troy ounces from the Eligible category and into Registered over at CNT.  The link to all this is here.

In silver, the only ‘in’ activity was one truckload…602,799 troy ounces…that was dropped off at CNT.  The only ‘out’ activity was one good delivery bar…961 troy ounces…that departed Delaware.  There was also 61,454 troy ounces transferred from the Eligible category — and into Registered over at CNT as well.  The link to this is here.

For a change, there was big in/out movement over at the COMEX-approved gold kilobar depositories in Hong Kong on their Wednesday.  They reported receiving 3,001 of them — and shipped out 3,540.  All of this action was at Brink’s, Inc…and the link to that, in troy ounces, is here.


Here are three charts the Nick Laird passed around yesterday evening.  They show gold imports and exports out of the U.K…updated with June’s data.  The first chart shows the total number of tonnes received and shipped out during that month…78.2 tonnes in — and 53.4 tonnes out.  Click to enlarge.

These next two charts shows the countries of origin they received gold from — and their associated tonnages.  The second shows the countries and tonnages they shipped gold to during June.  Click to enlarge for both.

It should be noted that tiny Azerbaijan stepped up to the plate once again, as they imported another 7.9 tonnes.  They haven’t been making regular purchases, but when they do, they buy an impressive amount.

I have a very decent number of stories for you today.


CRITICAL READS

Recession Alarm: U.S. Manufacturing PMI Unexpectedly Crashes Into Contraction With Lowest Print in 10 Years

With all eyes focused squarely on Germany’s dismal PMI prints, which have been in contraction for over half a year, the investing public forgot that the U.S. economy is similarly slowing down. And moments ago it got a jarring reminder when Markit reported that the U.S. manufacturing PMI unexpectedly tumbled into contraction territory, down from 50.4 last month, and badly missing expectations of a 50.5 rebound. This was the first print below the 50.0 expansion threshold for the first time since September 2009.

But wait, there’s more, because whereas until now the U.S. services segment appeared immune to the slowdown in U.S. manufacturing, in August the service PMI tumbled to 50.9, down from 53.0 in July, matching the lowest print in at least 3 years, and well below the 52.8 consensus expectation.  According to Markit, subdued demand conditions continued to act as a brake on growth, with the latest rise in new work the slowest since March 2016. This contributed to a decline in backlogs of work for the first time in 2019 to date.

Meanwhile, business expectations among service providers for the next 12 months eased in August and were the lowest since this index began nearly a decade ago.  Click to enlarge.

As the report further notes, the decline in the headline PMI mainly reflected a much weaker contribution from new orders, which offset a stabilization in employment and fractionally faster output growth.

This however was offset by new business received by manufacturing companies, which fell for the second time in the past four months during August. Although only marginal, the latest downturn in order books was the sharpest for exactly 10 years. The data also signalled the fastest reduction in export sales since August 2009.

This Zero Hedge news item from Brad, was posted on their Internet site at 9:59 a.m. EDT on Thursday morning — and another link to it is here.


Economic Expectations of U.S. Consumers Slumps to Five-Month Low

U.S. consumer expectations fell to a five-month low in August as fears of an economic downturn and stock market volatility weighed on sentiment.

The Bloomberg Consumer Comfort Index’s monthly expectations gauge fell to 48.5 from 55 as a larger share of respondents said the economy is getting worse, according to the Aug. 6-18 survey released Thursday. The weekly reading edged up to 61.5 from 61.2 as Americans’ views of their finances and the buying climate improved.

Key Takeaways

  • Expectations pulling back from the year’s highest level follows weeks of financial-market gyrations along with rising global growth concerns.
  • The weekly figures also showed views of the state of the economy declined for a third-straight week, the longest such stretch since early May. The improvement in the weekly comfort measure suggests confidence may be stabilizing after the largest back-to-back slide in the weekly measure since March 2011.
  • The data reinforce earlier sentiment readings from the University of Michigan’s preliminary August survey, which showed confidence fell to a seven-month low on growing concerns about the economy.

This brief article showed up on the Bloomberg website at 6:45 a.m. PDT [Pacific Daylight Time] on Thursday morning — and I thank Swedish reader Patrik Ekdahl for pointing it out.  Another link to it is here.


Preview of Powell’s Jackson Hole Speech: Brace For Disappointment

While the full program of this year’s Jackson Hole symposium will be released tonight at 8 p.m. ET, what we do know is that Chair Powell will address the symposium on Friday, August 23rd at 10 a.m. ET. Powell is widely expected to preface his prepared remarks with an update on current conditions that acknowledges continued risks from trade and global growth, similar to the July statement, however he may disappoint markets which are expecting a far more explicit commitment to future rate hikes.

Indeed, as noted earlier, following surprisingly hawkish comments from Philly Fed president Harker, Kansas City President Esther George and Boston Fed president Eric Rosengren, all of whom voiced their opposition to additional cuts, the market-implied odds of a 50bps rate cut in September has tumbled to just 2% as of this afternoon, down from 41% a week ago, resulting in yet another inversion in the 2s10s curve as 2Y Treasury yields spiked.

If anything, today’s hawkish tone was a reminder that it is premature to expect a signal on the size of the Fed’s September move something which the market desperately wants; In fact, as Morgan Stanley writes, Powell will certainly choose to maintain flexibility on size by reminding us the Fed “will act as appropriate to sustain the expansion.”

Furthermore, there’s been no gathering since the July FOMC, the few policymakers who have since spoken publicly have either been surprisingly hawkish, or have underscored that there is no pressing need to take additional action… and there’s still more data to get through ahead of the next meeting.

Key risks: As Morgan Stanley’s Ellen Zentner writes, watch for the use of “somewhat” when Powell is describing further adjustments. Investors may associate the word “somewhat” with 25bp. Acknowledgment that downside risks have increased with no characterization of “somewhat” could be taken as confirmation that it is likely the Fed makes a larger cut in September, although that now appears unlikely.

This speculative commentary appeared on the Zero Hedge website at 3:09 p.m. on Thursday afternoon EDT — and it’s the first of the day from Brad Robertson.  Another link to it is here.


Larry Summers Comes Clean Ahead of J-Hole, Admits Central Planners Are Impotent

Larry Summers is not one to be shy about sharing his opinion on any and every media channel about just how bad President Trump’s policies are, and how much better everything was in the world under President Obama.

However, in an epic thread of apparent honesty, the former director of the National Economic Council for President Obama took to Twitter to dispel any myths about the omnipotence of central planners and to confirm there’s nothing anyone can do to save the world from doom (especially Jay Powell’s speech tomorrow).

Mea Culpa? Or partisan political pandering to reinforce the “recession is imminent and there’s nothing to stop it and it’s Trump’s fault and that means Trump’s unelectable” narrative?

Summers begins his diatribe by addressing the big imminent issue ahead of us:

Coming into Jackson Hole, economists are grappling with a major issue: Can central banking as we know it be the primary tool of macroeconomic stabilization in the industrial world over the next decade?

His worry – they are running out of ammo and what ammo they have is losing its mojo…

This limited space for interest rate cuts is true of the U.S., which has the highest interest rates in the industrialized world. It is even more true of Europe and Japan.

QE and forward guidance have been tried on a substantial scale. We are living in a post QE and forward guidance world. It is hard to believe that changing adverbs here and there or altering the timing of press conferences or the mode of presenting projections is consequential.

Then, Summers goes after central planner over-confidence…

So, after that 28 tweet thread of self-flagellation, wouldn’t it have been more interesting if Summers had said all that oh, ten years ago?

This story/Tweet storm was posted on the Zero Hedge Internet site at 11:30 a.m. EDT on Thursday — and it’s the second contribution of the day from Brad Robertson.  Another link to it is hereGregory Mannarino‘s 18-minute rant after the market close on Thursday is linked here.


Sinking Liquidity for Argentine Debt Adds to Emerging Market Investor Woes

Trading Argentine bonds has become a test of endurance as the prospect of a possible default triggers wild price swings and volume dries up.

The Liquidity Assessment Scale of 1 to 100 (100 being the most liquid) slumped to 12 on Wednesday for the South American nation’s bonds from 68 just three weeks ago.

There is a lot of hysteria in the market and it is causing a lot of uncertainty on valuations,” said Jason Devito, a Pittsburg-based money manager at Federated Investment Mgmt Co., which has $502 billion under management.

The peso is hovering near record lows, extending this year’s worst decline in emerging markets, after opposition candidate Alberto Fernandez won a landslide victory in the Aug. 11 primary, making him clear favorite for the Oct. 27 presidential election. Investors fear he will seek to renegotiate debt obligations with the International Monetary Fund and bondholders.

The liquidity crunch prompted selling in other high-risk debt, triggering $1.1 billion outflows from emerging-market debt funds in the week ending Aug. 14, according to Bank of America Merrill Lynch citing EPFR Global data.

This story put in an appearance on the Bloomberg Internet site at 6:39 a.m. PDT on Thursday morning — and it’s the first offering of the day from Swedish reader Patrik Ekdahl.  Another link to it is here.


German Companies Signal Looming Recession After Demand Plunges

German manufacturers are reinforcing concern that Europe’s largest economy is headed into a recession.

A nationwide gauge showed orders at factories and services companies are dropping at the fastest pace in six years, and more companies now expect output to fall than rise over the next 12 months. That’s the first time that’s happened since 2014, according to the Purchasing Managers’ Index from IHS Markit.  Click to enlarge.

The peek into the engine room of European industry provides a damning snapshot of the economy, which shrank in the second quarter. The persistent weakness — driven in particular by mounting global trade tensions, car industry woes and slowing demand in China — doesn’t bode well for the broader euro area.

European Central Bank policy makers have already started laying the groundwork to add monetary stimulus, and are expected to cut interest rates at their next meeting in three weeks. In Germany, the government has made only tentative steps toward a fiscal stimulus program aimed at supporting growth.

Somehow they are not looking at this data,” said Carsten Brzeski, chief German economist at ING in Frankfurt. “The German government should react. We have this stagnation of the entire economy now and we really need some fiscal stimulus.”

This news item was posted on the Bloomberg website at 12:30 a.m. PDT on Thursday morning — and was updated an hour and change later.  It’s another contribution from Patrik Ekdahl.  Another link to it is here.


Russia’s Rosneft to switch to euros in oil products tenders — traders

Russia’s Rosneft, one of the world’s top oil producers and exporters, has notified customers that future tender contracts for oil products will be denominated in euros not dollars, five trading sources told Reuters.

The move, which could come as soon as this year, is likely to be seen as an attempt to offset any potential negative impact of U.S. sanctions on Russia.

Rosneft, which accounts for over 40% of oil output in Russia, produced 45.8 million tonnes of oil products at home in the first six months of this year – from diesel and gasoline to fuel oil and petrochemicals.

Around half was exported to west and south-east Europe and to Asia, according to the company’s own data.

This Reuters article, filed from Moscow, showed up on the uk.reuters.com Internet site at 4:43 a.m. EDT on Wednesday morning — and it comes to us courtesy of Brad Robertson.  Another link to it is here.


Stubbornly strong dollar prompts talk of U.S. attack on China’s currency

Top Chinese bankers in London are warning of the drama that would follow any U.S. attempt to weaken the dollar by intervening in renminbi markets — a move that would be seen by Beijing as a “political act.”

The risks of such action have heightened since June, said analysts, after U.S. President Donald Trump repeatedly took aim at China and Europe for “playing currency games” as trade wars threatened to spill over into foreign exchange markets.

The U.S. Treasury officially branded China a currency manipulator this month after the Chinese central bank allowed the renminbi to fall below 7 to the dollar, a key threshold last breached in 2008, leading to escalation in trade tensions. Today the renminbi was trading at a fresh low of 7.0749.

But despite a lull in tit-for-tat tariffs and a delay to some additional levies on Chinese imports to the U.S., the warnings are the latest signal that markets are taking the currency threat seriously. One senior staffer at a London-based Chinese bank said the U.S. could conceivably intervene in the offshore renminbi market, where the currency is traded more freely than on the mainland. But the consequences could be serious.

The above four paragraph are all that are posted in the clear from this Financial Times of London story on Thursday.  The rest of it is subscriber protected.  I found it in a GATA dispatch yesterday — and another link to the hard copy is here.  The Zero Hedge spin on this from yesterday evening EDT is headlined “China Threatens U.S. Currency Intervention Would Lead to “Market Turmoil” And “Unprecedented Political Fallout


Investors Hoard Most Gold in ETFs in Six Years

Gold’s faring extremely well as a haven asset, with inflows into exchange-traded funds hitting 1,000 tons since holdings bottomed in early 2016 after a prolonged unwind in the wake of the global financial crisis.

Total known ETF holdings expanded to 2,424.9 tons on Wednesday, the highest since 2013, following inflows over the past three years and a continued build-up in 2019, according to data compiled by Bloomberg. Current assets are about 1,000 tons higher than the post financial crisis nadir of 1,425.1 tons.

Gold has surged this year as investors seek protection from slowing global growth, the incessant trade war, and turmoil in the bond market that suggests the U.S. may be headed for another recession. The rise has been aided by a rate cut from the Federal Reserve and expectations more will soon follow. This week, veteran investor Mark Mobius gave a blanket endorsement to buying bullion, saying accumulating the precious metal will reap long-term rewards.

Others are also bullish. Goldman Sachs Group Inc. has said prices will climb to $1,600 an ounce over the next six months. The bank’s global head of commodities research, Jeffrey Currie, said that gains are likely be fueled by demand for ETFs as well as increased central-bank purchases. Spot gold traded at about $1,500 on Thursday, up 17% this year.

This Bloomberg article put in an appearance on their Internet site at 10:59 p.m. PDT on Wednesday night — and was updated an hour and change later.  It’s the final offering of the day from Patrik Ekdahl — and I thank him on your behalf.  He sent it to me late on Wednesday night, but I missed it for my Thursday column, so here it is now.  Another link to it is here.


Indians pawning the family gold amid credit crunch

Refused a loan by a state-run lender and desperate for funds to buy cotton seeds before the summer sowing season window closed, Indian farmer Babasaheb Mandlik ran out of choices – he pawned his wife’s gold jewelry.

Mandlik, who owns an 8-acre cotton farm in western India, pledged 70 grams of gold, almost all of his wife’s precious trinkets, in June in return for 150,000 rupees ($2,105).

Pawning the jewelry was a difficult decision as my wife likes to wear it at festivals and weddings,” 50-year-old Mandlik told Reuters. “I convinced her that we didn’t have any other option.”

Mandlik is not alone. While pawning gold has long been an option for quick funds in a country that is the world’s second-biggest consumer of the yellow metal, several lenders told Reuters of unprecedented demand as people struggle to secure loans from banks grappling with bad debt and a shadow lending industry stung by a liquidity crunch.

The trend, which has prompted some lenders to impose restrictions as risks and borrowing costs rise, has been accelerated by record gold prices.

Indians’ penchant for gold spans centuries and is rooted in the Hindu religion. Households own an estimated collective 25,000 tonnes of gold, which passes from one generation to the next.

This gold-related news item from Reuters was co-filed from Aurangabad and Mumbai at 10:02 p.m. on Thursday night EDT — and I found it on the gata.org Internet site.  Another link to it is here.


China Partially Lifts Restrictions on Gold Imports

China has partially lifted restrictions on imports of gold, bullion industry sources said, loosening curbs that had stopped an estimated 300-500 tonnes of the metal worth $15-25 billion at current prices from entering the country since May.

China’s central bank had for several months curtailed or not granted import quotas to commercial banks responsible for most of the gold that enters the country, Reuters reported last week.

Sources said those measures had possibly been designed to reduce capital outflows and bolster the yuan, which has slumped to 11-year lows against the dollar as a trade dispute with the United States batters China’s economy.

The central bank began to issue quotas again last week, but for lower amounts of gold than considered normal, three people with direct knowledge of the matter in London and Asia said – without specifying exact amounts.

Some (quotas) have been given,” said one of the sources, adding that these were “less than usual.”

It’s a “partial lift” of the restrictions, another source said.

This Reuters story, co-filed from London and Beijing, put in an appearance on their website at 6:51 a.m. EDT on Thursday morning — and I lifted it from a Zero Hedge article that Brad sent our way.  Another link to it is here.


The PHOTOS and the FUNNIES

Here are the last three photos from our side trip up to Silver Lake Provincial Park, just outside Hope.  The first is of a chipmunk that my daughter spotted in the leaf litter under a tree.  The second was taken from the other side of the lake.  The grassy spot in the center of this photo is where I took the photo of the chipmunk, plus the three photos that appeared in Thursday’s column.  The last shot is one I took on the road back to Hope.  It’s of a waterfall flowing into the creek that drains out of Silver Lake.  Click to enlarge.


The WRAP

It was yet another day where, as Ted mentioned on the phone yesterday, gold, silver and platinum were sold lower in Far East and early London/Zurich trading, but came roaring back during the New York trading session.  And during those last couple of days, both gold and silver prices were capped and sold lower the moment they broke above unchanged in New York — and were closed lower on the day as well.  If this doesn’t fit the description of ‘care and maintenance’ from a price perspective, I don’t know what does.

Here are the 6-month charts for all four precious metals, plus copper and WTIC — and there’s not a lot to see in any of them.  But once again I’ll point out that all of the price action [mostly lower] that occurred after the COMEX close yesterday, is not reflected in their Thursday dojis.  Click to enlarge for all.

And as I type this paragraph, the London/Zurich opens are less than a minute away — and I see that the gold price ticked up a bit at the 6:00 p.m. open in New York on Thursday evening — and that represents its current high, as it was sold quietly lower for almost the rest of the Far East trading session on their Friday. It’s off its low tick of the day by a hair as London opens — and down $2.20 the ounce. Silver’s price path was guided in the same manner — and it’s down 2 cents. The platinum price ticked very quietly and unevenly higher in Far East trading — and it’s up 2 dollars currently. The price pattern for palladium was mostly similar — and it’s up a dollar as Zurich opens.

Net HFT gold volume is fairly quiet…coming up on 34,500 contracts — and there’s only 969 contracts worth of roll-over/switch volume in this precious metal. Net HFT silver volume is ultra quiet at a bit over 4,800 contracts, but there’s already 2,356 contracts worth of roll-over/switch volume out of September and into future months…mostly December.

The dollar index opened up 2 basis points once trading commenced at around 7:45 p.m. EDT in New York on Thursday evening, which was 7:45 a.m. China Standard Time on their Friday morning. It has been edging very quietly — and somewhat unevenly higher since — and as of 7:45 a.m. BST in London/8:45 a.m. in Zurich, the index is up 18 basis points.


Today, around 3:30 p.m. EDT, we get the latest and greatest Commitment of Traders Report for positions held at the close of COMEX trading on Tuesday.  I’m hoping/expecting slight improvements in the commercial net short positions in both.  But as I said on Wednesday, I won’t be overly surprised if I miss the mark.

Silver analyst Ted Butler had this to say about it in his mid-week commentary to his paying subscribers on Wednesday…”As far as what Friday’s COT report may indicate, I’m going to take another pass on specific contract predictions. Price action in both gold and silver was choppy, trading both above and below the reporting week close of a week ago and with gold finishing roughly unchanged for the reporting week while silver ended up about 15 cents. I’m much more interested in seeing what JPMorgan may have been up to and whether there will be another surprise in silver, as far as further managed money selling and commercial buying.”

Apparently Fed chairman Powell opens his pie hole from Jackson Hole at 7 a.m. EDT this morning — and it will be interesting to see how the various markets react…or are allowed to ‘react’ to what he says.  I’ll be most interested in what ‘da boyz’ do with precious metal prices at that moment — and nothing will surprise me when ‘The Word’ hits the tape.


And as I post today’s column on the website at 4:02 a.m. EDT, I note that the tiny rally in gold going into the London open was capped and turned lower shortly after that — and it’s down $1.90 the ounce. Silver was up penny before being sold lower in London — and it’s now back at unchanged as the first hour of London trading ends. Platinum is up 3 bucks — and palladium is still up a dollar.

Gross gold volume is a bit over 45,500 contracts — and minus what little roll-over/switch volume there is, net HFT gold volume is a bit under 43,500 contracts. Net HFT silver volume is still ultra quiet at a hair over 6,000 contracts — and there’s 2,752 contracts worth of roll-over/switch volume on top of that.

The dollar index has been chopping quietly sideways for the last hour — and as of 8:45 a.m. in London/9:45 a.m. in Zurich, the dollar index is up 18 basis points.

That’s it for another day.  Have a good weekend — and I’ll see you here tomorrow.

Ed