Weekend Gold Price & Silver Price Review

New York (Mar 14)  As has been the case for three days in a row, the smallish rally in gold in Far East trading met the usual not-for-profit sellers an hour or so before the London open.  The low tick came shortly after 11:00 a.m. EDT in New York.  The gold price rallied quietly from there, before tacking on another quick five bucks in the last hour of trading in the electronic market.

The high and low ticks, such as they were, were recorded as $1,160.90 and $1,150.40 in the April contract. Gold closed in New York yesterday at $1,158.60 spot, up $5.90 from Thursday.  Net volume was very quiet at only 104,000 contracts.

For the third day in a row, the silver chart pattern was a virtual carbon copy of the gold price chart, although in silver the high of the day came at the close in New York---and not in late afternoon trading in the Far East like it did in gold.

The low and high were recorded by the CME Group as $15.455 and $15.66 in the May contract.

Silver finished the Friday session at $16.64 spot, up 8.5 cents from Thursday.  Net volume was also very quiet at only 18,500 contracts.

The platinum and palladium charts were, once again, mini versions of the gold and silver charts.  Platinum closed up two bucks at $1,115 spot---and palladium was up 4 dollars to $790 spot.  Here are the charts.

The dollar index closed late on Thursday afternoon at 99.27---and rallied unevenly from there, with the 100.39 high tick coming shortly after 2:30 p.m. EDT.  From there it sold off a bit into the close, but still managed to close with a three-digit handle at 100.19 ---up another 92 basis points.

The gold stocks opened down a hair---and then sank to their lows minutes after 11 a.m. EDT, which was gold's low as well,  The subsequent rally made almost back to unchanged---and undoubtedly would have closed in the green if the last minute rally in the gold stocks had occurred before the markets closed.  The HUI finished down a smallish 0.39 percent.

The silver equities followed an almost identical pattern as the gold equities, except they started the trading session off in positive territory---and ended there as well.  Nick Laird's Intraday Silver Sentiment Index closed up a decent 1.10 percent.

The CME Daily Delivery Report showed that one gold and 113 silver contracts were posted for delivery within the COMEX-approved depositories on Tuesday.  In silver, the only short/issuer was Jefferies---and the biggest long/stopper was, drum roll please, JPMorgan in its in-house [proprietary] trading account with 77 contracts.  Canada's Scotiabank was a very distant second with 16 contracts received.  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 for March declined by 19 contracts---and the new total is down to 111 contracts.  In silver, March o.i. fell by 39 contracts, which was all delivery related---and open interest is now at 805 contracts, minus the 113 contracts mentioned in the previous paragraph.

There was a tiny withdrawal from GLD yesterday, only 8,917 troy ounces worth.  I would guess that this represents a fee payment of some kind.  I must admit that I'm somewhat surprised that GLD hasn't shed more gold than that considering the hammering the price has taken over the last week.  I would bet serious money that all the GLD shares that were falling off the table lately were being picked up by JPMorgan et al.  What else could explain the lack of withdrawals?

As of 7:40 p.m. EDT yesterday evening, there were no reported changes in SLV---and what I said about GLD shares in the previous paragraph also applies to SLV shares as well.

The folks over at Switzerland's  Zürcher Kantonalbank updated their website with the activity in both their gold and silver ETFs as of Friday, March 6---and there were declines in both once again.  Their gold ETF dropped by 34,354 troy ounces---and their silver ETF declined by 229,451 troy ounces.

There was another tiny sales report from the U.S. Mint yesterday.  They sold 57,500 silver eagles---and that was all.

Month-to-date the mint has sold 23,000 troy ounces of gold eagles---3,500 one-ounce 24K gold buffaloes---and 1,431,000 silver eagles.  Based on these sales, the silver/gold sales ratio works out to 54 to 1.

There was decent movement in gold at the COMEX-approved depositories on Thursday.  Nothing was reported received, but 68,035 troy ounces were reported shipped out.  The link to that activity is here.

It was monstrous day for silver, as 602,112 troy ounces were reported received---and 1,438,058 troy ounces were shipped out the door.  The link to that action is here.

The Commitment of Traders Report for positions held at the close of COMEX trading on Tuesday was about what I was expecting to see.

In silver, the Commercial net short position, decreased by a chunky 6,449 contracts, or 32.2 million troy ounces ---and is now down to 33,263 contracts, or 166.3 million troy ounces.  It's not lowest it's ever been, but certainly getting there.

Ted said that the Big 4 traders reduced their net short position by 2,000 contracts---and the '5 through 8' traders only by 200 or so.  The smaller Commercial traders added another 4,300 contracts to their already huge long position.  Ted also said that JPMorgan's short-side corner is somewhere in the 13-15,000 contract range.

We're both of the opinion that JPMorgan is no longer the biggest short in COMEX silver---and it's been my opinion for years that it's Canada's Scotiabank, with a short position in the 15-20,000 contract range.

Over in the Managed Money category in the Disaggregated COT Report, these technical fund-type traders added 6,575 contracts to their short position.  They've added more since the cut-off.

The other surprise in the Managed Money category, was with what I call the "unblinking" longs.  These are non-technical fund traders.  Price doesn't matter to them---and it showed again in this report, as they added 1,593 longs to their long position that now totals 42,054 contracts, or 210 million troy ounces.  Who are these guys, you ask?  Beats me, I say---but someday we'll find out.

In gold, the Commercial net short position declined by a healthy 34,045 contracts, or 3.40 million troy ounces.  The Commercial net short position now stands at 8.93 million troy ounces.

The Big 4 traders covered 8,000 contracts---and the '5 through 8' traders another 2,000 or so.  But it was the raptors, the smaller traders that were the most active, as Ted says they added 24,000 contracts to their already huge long position.  Ted says its about the same size now as it was back in November at the lows then.

In the Disaggregated COT Report, the technical funds in the Managed Money category sold 8,247 long contracts---and added 16,039 short contracts on top of that.  Ted was expecting more than this, but as I pointed out, the "unblinking" non-technical fund longs in the Managed Money category were probably adding to their long positions in gold as well---and that made the overall numbers in that category not quite as good as he was expecting.

While on the subject of the "unblinking" non-technical fund longs, despite the massive price declines during the reporting week, they increased their long positions in palladium, platinum and silver, as they all showed positive net numbers.  Only gold was negative---and as I said in the previous paragraph, their buying was masked by the huge selling by the technical funds in the same category.

Source:  TheStreet