Gold Seasonality And Average Intraday Price Movement

It will be interesting to see how gold moves in the latter half of this year.

As for the intraday movement, the impact of the London - New York on the gold trade is hard to miss.

It might not be too glib to say that the Anglo-Americans are sellling, and the rest of the world is buying overnight.

I certainly hope that this sort of long term price manipulation does not catch up to them on the supply side.

Recent Trends in the Premium For Silver Coins Versus Spot Silver

"One important aspect of the physical market that is often overlooked is the premium it commands over spot price. Right before the Global Financial Crisis in 2008, the spot Silver price fell as low as USD 9 per oz., whereas the price of a 1 oz. Silver Eagle was around USD 17 on the wholesale market and even higher on the retail market! That’s a price premium of 188%!

That means that if you had held 100 oz. of paper Silver, you might have had to liquidate that for USD 900 (assuming the market was not halted for trading then), whereas if you had held 100 pieces of 1 oz. Silver Eagle coins, you would have gotten at least USD 1700 for them if not more."

BullionStar, The Difference in Paper and Physical Gold and Silver in times of Crisis

For the charts below the price data is the 'Ask'  live price from a major online supplier.

As always, if it is data related to the gold and silver markets and it is publicly available, Nick Laird at goldchartsrus.com is probably keeping track of it.

Shanghai Exchange Has 73 Tonnes of Gold Withdrawn In 4th Largest Week In History

There were a little over 73 tonnes of physical gold withdrawn from the Shanghai Gold Exchange in the latest week ending August 21st.

This is the 4th largest withdrawal of bullion in its history.

It is hard to tell what exactly is going on in such a dodgy, highly leveraged market, with its determined attempts to keep the price knocked lower so often during the late London to NY trading hours.

But I am sensing a change in the market, and more things running under the surface than meets the eye.

Goldman is no major player in the gold bullion market, but it did strike me as odd that they are suddenly stopping large amounts of bullion for their own house account this month. It is not that they are a player in gold, because they are not.  But that they are wired into many sources of information, are good at spotting trends, and are more like a hedge fund, comfortable running on the edge of the markets.

And the gold chart, for what it is worth in these times of market interventions, seems to be trying to form a rounded bottom in the form of  a cup and handle, with a successful retest of the handle this week.  This calls out a price around the bottom of the old trend channel at 1270.

It could also be nothing.  I will pursue the details of such a chart formation if we see the right kinds of follow through next week.

And I will certainly be watching silver very carefully for any signs of life.  It may be pivotal next month.

Let's see what next week brings.  Gold is just one market among many, and it is certainly not the largest one in play.

And while I have your attention, I thought I would include a long term chart of the relation of deliverable gold at current prices to open interest.  It might mean nothing.  But it doesn't seem to be anything familiar before 2013
.

The charts below courtesy of data wrangler Nick Laird at goldchartsrus.com.

Gold Daily and Silver Weekly Charts - Maintaining Confidence - Keep On Dancing

The action was a bit heavy in the metals today, as the Powers-That-Be quietly attempted to restore confidence and a sense of well-being and recovery after the somewhat disconcerting equity market plunge of Monday.

There was intraday commentary here about some interesting Goldman Sachs activity in an otherwise exceptionally sleepy week at The Bucket Shop.

People often ask me for a possible motive as to why central banks might care about gold and silver. Willem Middelkoop does a decent job of briefly explaining why in the first pictorial below.  It is all a part of the confidence game, when a series of bad decisions place a strain on one's full faith and credit.

The goal of the financial class is to keep the music going, and the public out there on the floor dancing so they don't have time to think.

Still out there bottom watching.

Have a pleasant weekend.