Great and Wonderful Friday Morning Folks,
The Precious Metals are trading lower this morning, after another surprise hike in margins was applied, with Gold now at $1,956, down only $14.40 and recovering from the low at $1,945.30 with the high at $1,970. December Silver is trading at $27.085 down 84.4 cents and is recovering from the low at $26.59 with the high so far at $28.03. We’ll be quoting the December Contract from now on because the Open Interest blew past Septembers as the roll overs are occurring faster than normal. The US Dollar is still flat as can be with the trade at 93.19, down 12.7 points after hitting a low of 93.135 with the high at 93.41. Of course, all this happened before 5 am pst, the Comex open, the London close, and after the DOJ found out that Yale illegally and intentionally discriminated against Whites and Asians. What part of Equal Rights requires pigment?
Even though the margins were raised at the Comex, the precious metals inside the emerging markets continue to trek higher as their currencies increase in quantity, not quality. In Venezuela, Gold is now priced at 19,535.55, showing an increase of 134.83 Bolivars with Silver gaining 5.393 with the current priced at 270.511 Bolivars. Argentina’s currency now has Gold’s value at 142,857.19 Peso’s providing the holder a 1,045.09 gain with Silver now priced at 1,977.90 A-Peso’s, popping in an additional 40.18 overnight. The Turkish Lira’s price for Gold now rests at 14,437.67, showing a gain of 188.58 Lira’s with Silver’s last trade adding 5.211 with the price at 199.920 T-Lira’s.
August Silver’s Delivery Demands now shows a post of 22 fully paid for contracts waiting for receipts with a Volume of 12 already up on the board with a trading range between $27.685 and $27.205 with the last trade at $27.23, down 45.4 cents while the futures markets, attempt to pump and dump, the prices lower. Yesterday’s delivery activity happened in between $27.525 and $26.38 with the last purchase at $27.38 with the calculated close at $27.694, a gain of $1.739 that included a Volume of 30, reducing the previous days count by 85 contracts that supposedly got receipts somewhere. Silver’s Overall Open Interest lost another round of shorts as 1,289 contracts jumped ship during yesterday’s rally leaving a total of 196,043 Overnighters to go against the physicals. To me, the raising of the margins within 7 trading days, pumping up the Option values, and the adjustments in the delivery price close’s, are all proving to be markers of desperation at the Comex, as the physicals become harder and harder to find everywhere.
August Gold’s Delivery Demands now shows 613 fully paid for contracts waiting for receipts and with a Volume of 53 up on the board with a trading range between $1,934.40 and $1,938.70 with the last trade at $1,941.90, down $14.80 so far today. Yesterday’s physical trades happened in between $1,957.40 and $1,916.90 with the last registered trade at $1,947 with the higher close at $1,956.70, providing a gain of $21.80 which also reduced the demand count by 251 contracts that got receipts. Adding more to the above paragraphs point, it seems the closing delivery prices are adjusted higher in order to make the next day’s dip look bigger, but if one simply focuses on the purchases and ignoring the closing prices, things really don’t seem to be moving as much as the papers. Gold’s Overall Open Interest is really showing the fear in deliveries as the count dropped 7,682 short contracts leaving 543,918 Overnighters going against a product in heavy demand.
Things have already been interesting inside the Comex Precious Metals and it appears to be increasing. Comex already replaced those Time Outs (circuit breakers) with a percentage limit (in March, 2020), and that too was totally removed before it could be used. Now they are raising margins quickly, and we expect many more increases (and decreases to create the illusion) to come, as the margins eventually go to 100%. Basically, it’s a wide-open infestation of activity in order to find physicals at all costs to meet the demands. First, they have to reduce the investors count from profitting off the demands. Second, they have to get out of their shorts, and third, Comex is required to find product no matter what the price. It is the last place to get product and many are certain the Comex will default. Will they? Imo, nowhere near these prices, maybe 100’s or 1,000’s of percentage points from here. Reminder; Jim said in one of the weekly interviews, that he was surprised that the Hunt Brothers didn’t sue the Comex back at the Life of Contract High when they no longer allowed the buying of physical! He felt they had a big chance of winning. Will they attempt to do it again and if so, how will the Comex defend their actions when they claim to be physical deliverers of the last resort? How about those inside the governing bodies that support the system?
Regardless of the future responses coming from Comex, sitting tight with physicals, trumps all the papers. So, keep things real and in hand, have a smile on your face and a prayer for all. Have a Great and Wonderful Weekend and, As Always …
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