Saturday, September 21, 2013

Ed Steer's Gold and Silver report - September 21 , 2013 ... News , data and Views touching on the precious metals !

http://www.caseyresearch.com/gsd/edition/market-rigging-whistleblower-ted-butler-interviewed-by-sprott-money-news



¤ YESTERDAY IN GOLD & SILVER

As I mentioned in The Wrap in Friday's column, the price action and volume in Far East trading on their Friday was dead right up until the London open.  That's when things changed and, in hindsight, for the worst.
The high-frequency traders spun prices lower on several occasions during the Europe and U.S. trading day, and bought up all the longs that the tech funds and small traders were prepared to puke up as sell stops were hit.  It was the same old, same old, and I'll have more on this later.
Anyway, by the time gold was done for the day, it closed at $1,325.60 spot, down $39.50 from Thursday's close.  Not surprisingly, net volume was immense at around 196,000 contracts.
But silver really got smashed, as the price got hammered for about 3% by the HFT boys in the space of about thirty minutes during mid-morning trading in New York.  The smallish rally from there ran into more high-frequency traders shortly after, and they kept up the price pressure until well after the 1:30 p.m. EDT Comex close.
Silver finished the Friday session at $21.80 spot, which was down $1.285 on the day.  Although silver didn't close precisely on its low tick, it came close.  Net volume was a monstrous 62,500 contracts.
It was more or less the same story in platinum and palladium as well, as their respective charts are almost identical to gold's.
For the day, the high-frequency traders closed gold down 2.89%, silver down 5.57%, platinum down 2.06%, and palladium 1.91%.  Not even rhodium was spared, as it was bid down 2.50%.
Of course the dollar index did zip.  It closed late Thursday afternoon in New York at 80.34, and then traded almost ruler flat until half-past lunchtime in London.  At that point it chopped a few basis points higher and closed on Friday afternoon at 80.44, up a whole ten basis points on the day.


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The CME's Daily Delivery Report showed that 1 gold and ten silver contracts were posted for delivery on Tuesday within the Comex-approved depositories.  The link to yesterday's Issuers and Stoppers Report is here.
Hard on the heels of the Thursday deposit into GLD, was an even larger withdrawal by an authorized participant on Friday, as 57,932 troy ounces were removed.  And as of 10:32 p.m. EDT yesterday evening, there were no reported changes in SLV.
For the third day in a row, there was no sales report from the U.S. Mint.  Month-to-date the mint has sold 9,000 ounces of gold eagles; 5,500 one-ounce 24K gold buffaloes and 1,850,000 silver eagles.  Based on these figures, the silver/gold sales ratio works out to 127 to 1.
Once again there was almost no activity at the Comex-approved depositories in either gold or silver on Thursday.  In gold, they reported receiving 6,799 troy ounces, and didn't ship any out.  In silver, they didn't report receiving any either, but they did ship 41,506 troy ounces of the stuff out the door to parts unknown.
As expected, the Commitment of Traders Report showed improvements in the Commercial net short positions of both silver and gold, although I must admit that I was expecting a bigger improvement in silver than what was shown.  However, it is what it is.
In silver, the Commercial net short position declined by only 6.2 million ounces, and is now down to 111.3 million ounces. Ted Butler says that JPMorgan's short-side corner is a hair under 15% of the entire Comex futures market in silver on a net basis; which means that all the market-neutral spread trades have been subtracted from the total open interest; and in troy ounces, JPMorgan is short about 105 million ounces of the stuff.  On its own, this amount represents almost 100% of the entire Commercial net short position in that metal.  That's outrageous!
In gold, the improvement in the Commercial net short position, was 1.49 million ounces, which is a pretty big number, and substantially larger than the improvement we saw the week prior.  The Commercial net short position in gold is now down to 6.53 million ounces.
Ted says that JPMorgan Chase only added about 2,000 contracts to their long position, and their long-side corner in the gold market is a bit under 19% of the entire Comex futures market on a net basis.  In troy ounces, JPMorgan's long-side corner in gold works out to around 6 million troy ounces.
The other stand-out feature of this COT Report in gold was the fact that the lion's share of the improvement in the Commercial net short position were Ted Butler's raptors [some of the 53 small traders in the Commercial category other than the Big 8] buying every long contract that the traders in the Non-Commercial and Nonreportable category were dumping, or buying the long side of every contract that these same traders were going short.
And while on the subject of going short, the raptors tricked the Non-Commercial and Nonreportable [small] traders into piling in on the short side during the reporting week, and according to yesterday's COT Report, they added 12,400 contracts to their short positions, or 1.24 million ounces.  [Then they all got blown out of these same short positions during Wednesday's big rally, as the raptors rang the cash register again.]
I know that Ted will have much more about this in his weekly report to his paying subscribers later today, andand I'm looking forward to his comments.
Needless to say, the dramatic price action over the last three trading days has changed things a lot, andand we won't know by how much, or in which direction, until next Friday's COT Report.  All should be know to us by then, unless we have a big rally on either Monday or Tuesday that will mask whatever changes there were.
As I said in this space last week, it seems like I/we are always waiting for next week's report.
Since yesterday was the 20th of the month, and it fell on a weekday, The Central Bank of the Russian Federation updated its website with its August data.  It showed that they purchased 400,000 troy ounces of gold last month, and their total [official] holdings are now 32.6 million ounces, which is a hair over 1,000 tonnes.  Below is Nick Laird's most excellent chart that has been updated to show the change.


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Selected non redundant news and views.....


Australian bankers frosted by Fed, want their own dollar lower

Reserve Bank of Australia board ­member John Edwards has expressed frustration that the shock U.S. Federal Reserve decision to continue injecting billions into the ­global financial markets sent the Australian dollar to a three-month high...and above US95¢.
The higher dollar is likely to frustrate the new government and the Reserve Bank board, which wants a lower ­currency to make Australian manufacturers, tourism operators and other companies more competitive with their foreign counterparts.
“I want to see a lower dollar and it’s going to take us longer to get there – so it’s not great,” said Dr Edwards, who was an economics adviser to former prime minister Paul Keating.
Asked what level he would like to see for the dollar, he said: “I wouldn’t put a number on it. Lower is good.”
At least they admit right up front that they want to debase their currency.  This story was posted on the afr.com Internet site on their Friday, which was Thursday here in North America.  I found it in a GATA release yesterday.

Three King World News Blogs


India to resume gold imports but rules mean no rush

India will start buying gold again after a two-month gap as the government and banks have agreed how new rules on imports should work, easing prices in the world's biggest bullion buyer and helping supplies just as seasonal demand kicks in.
But monthly shipments by the world's top importer are unlikely to be even a quarter of May's record 162 tonnes to start with and annual imports will be sharply down, helping to cut a bulging current account deficit and support the rupee.
India's gold shipments came to a virtual halt after the Reserve Bank of India (RBI) told importers on July 22 that a fifth of their purchases would have to be turned around for export and that 80 percent would be available for domestic use.
"The issue stands resolved now and as a result imports will start immediately," said the source, who did not want to be named.

This must read Reuters story, filed from New Delhi, was posted on their website Friday evening IST...and is another article I found embedded in a GATA release yesterday.

Market rigging whistleblower Ted Butler interviewed by Sprott Money News

Silver market analyst, financial letter editor, and market rigging whistleblower Ted Butler was interviewed this week by Nathan McDonald of Sprott Money News, discussing manipulation of the gold and silver markets (especially by JPMorganChase & Co.) and the failure of the U.S. Commodity Futures Trading Commission to act against it. The interview is posted in both text and audio at the Sprott Money Internet site.

The audio interview runs about 28 minutes, but you can probably read the transcript in less time than that, dear reader.  Today's last story is a must read/listen for sure.

¤ THE WRAP

Invariably, JPMorgan has bombed the gold and silver market sure enough, but not by selling many thousands of contracts; but by first selling relatively few or pretending to sell many (spoofing) contracts in order to scare and induce others into selling many contracts so that the crooks at JPM can buy. Always, always, always, is it true that JPM and the commercials are net buyers on the big down days; and always is it true that the only reason for the big down days is to allow JPMorgan to buy at distressed prices. JPMorgan is perhaps the most crooked financial institution ever, but you must acknowledge that they are sophisticated crooks. They don’t stick up 7-Elevens; they conduct sophisticated financial fraud against other supposedly sophisticated market participants. - Silver analyst Ted Butler -- 14 September 2013
To sum up yesterday's price action, I only need quote the last paragraph of The Wrap from yesterday:
"With today being Friday, I have no idea what price activity lies in store for us in New York this morning, but using the price "action" of the last two days as a guide, it will be far removed from what a free market would dictate, so be ready for anything."
And that's pretty much how it turned out.
The Ted Butler quote above is one that I posted in my Tuesday column, but I thought it worth resurrecting for today's missive, as it speaks to yesterday's price action perfectly as well.  The raptors [which now includes JPMorgan] set prices lower through high-frequency trading algorithms and force long holders puke up their long positions as sell stops are hit, or go short; and the Commercials wait with open arms to buy every long that shows up, and ringing the cash register each time they do it.
They don't even try to hide anymore, as there is no adult supervision in sight, either from within the CFTC or the CME Group.  And it's a certainty that the miners won't say a word in protest as their industry, their companies and their shareholders get raped once again.  There are no men of principle running any of them.
How did it come to this?
I'm done for the day, and the week.
See you on Tuesday.

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