What is Happening to Gold?

July 4, 2013

Gold gained a few dollar during the Far East trading session…and then spiked up right at the 8:00 a.m. BST London open. The rally lasted for about five minutes before a not-for-profit seller appeared. From there it was all down hill into the low of the day, which came during electronic trading in New York around 2:40 p.m. EDT. After that, the price didn’t do much.

The low tick, as recorded by Kitco, was $1,238.80 spot. The high tick just after the London open was around $1,268 spot.

The gold price finished the Tuesday trading session at $1,242.40 spot…down $10.20 on the day. Net volume was only around 139,000 contracts, with the lion’s share of that being of the high-frequency trading variety.

It was almost the same price action in silver…and like gold, the tiny rally in early Comex trading in New York, got squashed with little effort. The low tick [$19.18 spot] also came at 2:40 p.m. EDT…and the recovery into the close of electronic trading didn’t amount to much.

Silver closed on Tuesday at $19.38 spot…down 27 cents from Monday‘s close. Net volume was only 33,500 contracts.

The platinum and palladium charts looked similar…especially platinum.

The dollar index closed on Monday at 83.02…and then didn’t do much until the 8:00 a.m. BST London open…and then away it went to the upside. The index peaked out at 83.59 just minutes after 3:00 p.m. EDT in New York…and basically traded sideways into the close. The index finished the day at 83.54…up 52 basis points.

The gold stocks gapped down a bit at the open…and kept right on going. The low tick came at 3:00 p.m. EDT [the dollar index high] right on the button…and they recovered a bit going into the close. The HUI closed down 4.76%…a decline out of all proportion to the drop in the metal price itself.

The silver equities got sold off hard as well…and the ones that make up Nick Laird’s Intraday Silver Sentiment Index closed down a chunky 5.01% on the day.

The CME’s Daily Delivery Report showed that 20 gold and 316 silver stocks were posted for delivery within the Comex-approved depositories on Friday…and 99 percent of the activity involved only two bullion banks. In gold, it was JPMorgan Chase and Canada’s Bank of Nova Scotia. And in silver the only short/issuer was also the Bank of Nova Scotia with all 316 contracts…and JPMorgan Chase was the long/stopper…with 274 contracts in its proprietary [in-house] trading account…and 31 in its client account. The link to yesterday’s Issuers and Stoppers Report is here.

There was another decline in GLD yesterday. This time it was a more substantial amount, as an authorized participant withdrew 115,962 troy ounces. But it was a different story over at SLV, as an authorized participant[s] added 1,785,815 troy ounces of the stuff.

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

Monday was another busy day in silver over at the Comex-approved depositories. They reported receiving 683,842 troy ounces…and only shipped 55,339 troy ounces out the door. The link to that activity is here.

In gold, these Comex depositories reported receiving 32,114 troy ounces on Monday…and didn’t ship any out. All of it went into Scotia Mocatta…and a line to that ‘action’ is here.

I have the usual number of stories for a weekday…and I hope you find the time to read the ones that interest you.

Source: http://www.caseyresearch.com/gsd/edition/john-hathaway-what-is-happening-to-gold

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