Posted on 12/19/2024 8:52:26 AM PST by delta7
Massive Comex deliveries since Thanksgiving Dec 13, 2024 · Alasdair Macleod In the last ten trading sessions on Comex, 62 tonnes of gold have been stood for delivery, and 1,303 tonnes of silver. What does this tell us?
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It was a week of two halves for gold and silver prices: rising strongly until Thursday when prices were smashed. In European trading this morning, gold was $2670, up $40 on balance from last Friday’s close having touched $2725 on Thursday morning. And silver was 20 cents lower on balance at $30.80, having been as high as $32.30. Trading volumes in the gold contract were moderate, but more active in silver.
A feature of this week’s trading was levitated futures’ premiums over spot, particularly noticeable in silver which before yesterday’s price smash represented a premium over overnight rates of as much as 7% annualised for the active February contract. While premiums and discounts in futures contracts over spot can and do vary, this detachment was unusually high. This sense of panic has now abated, and bullish hedge fund speculators are being stopped out.
This is very short-term stuff. Additional evidence of market strains is to be seen in the extraordinary level of stands-for-delivery associated with December’s Comex contracts running off the board. In the ten sessions since Thanksgiving, 62.13 tonnes of gold have been stood for delivery and 1,302.6 tonnes of silver. These are huge quantities, particularly for a derivatives market where delivery was not intended.
Almost certainly, there is a general bear squeeze on the establishment’s net short position. When derivative markets drove prices down in the first half of November, it provided the opportunity to buy futures specifically to take delivery of gold and silver. This development indicates that bullion demand exceeds supplies from other sources: mine output, scrap supply, and even buying for forward settlement in London. It suggests that we are unlikely to see those low prices again.
Could this be an early indication that both gold and silver need to be priced significantly higher for physical supply and demand to balance?
So far, excess gold demand from Asia over available supply plus central bank demand has been satisfied by western financial markets, including a reduction in ETF holdings. These sources have now dried up, which is what Comex deliveries may be telling us.
The actions of central banks in buying gold were always part of the story and a litmus test for a wider loss of Asian faith in western currencies. Sovereign wealth funds are also suspected of buying gold, and for the last forty years the numbers of rich families and individuals China and South-east Asia, and now India have increased substantially. Banks in both China and Russia offer gold accounts to savers which have become a hidden source of bullion demand.
In the west, we are almost certainly unaware of the true scale of gold demand from these sources and how it is evolving. In silver’s case, industrial demand has exceeded supply for the last four years, only satisfied by the drawdown of strategic stocks and investors’ holdings. That is also coming to an end, making far higher silver prices an increasing probability.
Finally, for chart followers here is the technical chart for gold:
Gold is finding support at the 55-day moving average. And given that the western financial system has been cleaned out of physical bullion liquidity, it appears to be on the verge of its next move higher.
That said, the East is cleaning out the Western supply ( Comex and LBMA).
I don’t know anything about Comex but how is Gortex doing? Also interested in TexMex.
“...62 tons of gold have been stood for delivery, and 1,303 tons of silver. What does this tell us?”
It tells me it’s a good thing they got it delivered before the Amazon drivers went on strike. It’s also a good thing the porch pirates didn’t figure out what was sitting in those boxes on the front porch.
Lot of solar cells being manufactured....thanks to the green's.
Trying to sucker people into buying. Everything published where the general public can see it is a lie. Bookmark this post. Barrick Gold (GOLD) stock DOWN today around $15 something a share. Was up to $17. Manipulation and lies.
“President Trump would be wise to do a full assay audit of our Gold Reserves.”
according to you there is not enough time. Civil war starts next month.
“A full audit has not been done since the 1950’s. Many “ greats” think it is all gone.”
Again, you post this misleading propaganda. Audits are routinely done.
“Many “ greats” think it is all gone.”
Which greats. I ask because you often post misleading or inaccuraye information unsourced.
I seem to remember there were a lot of Rock Hudson jokes around 1985 and 1986.
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