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Friday’s COT Report: A WTF Moment For the Ages? - Ed Steer (14/12/2017)

Friday’s COT Report: A WTF Moment For the Ages? - Ed Steer (14/12/2017)
By Ed Steer 2 years ago 15773 Views No comments

December 14, 2017

YESTERDAY in GOLD, SILVER, PLATINUM and PALLADIUM


The gold price was up a dollar or so in Far East trading on their Friday, but was turned lower once London opened. That tiny downturn lasted until at, or shortly after, the 10:30 a.m. GMT morning gold fix in London — and the price began to tick higher from that point. The big price slam that I was expecting on the release of the jobs numbers never materialized, but the volume between 8:30 and 10:00 a.m. in New York yesterday was amazing. That tiny rally in gold was capped and turned lower starting around 9:40 a.m. EST. That tiny sell-off ended at precisely 1:30 p.m….which was the COMEX close. That tick is not visible on the Kitco chart below, but stands out clearly on the New York Spot [bid] chart. From that juncture the price began to creep higher until shortly after 3 p.m. in the thinly-traded after-hours market — and it didn’t do much after that.

The low and high ticks certainly aren’t worth looking up.

Gold finished the Friday session in New York at $1,248.20 spot, up $1.40 on the day, but a new intraday low was set just after 8:30 a.m. in New York, albeit not by much. Considering the ‘quiet’ price action, net volume was pretty heavy at something under 263,000 contracts, with at least 54,000 contracts of that amount coming between 8:35 and 8:50 a.m. EST. One wonders what that was all about — and in light of yesterday’s dramatic changes in Friday’s COT Report, I’m now ultra-sensitive about things like yesterday’s price activity.

And here’s the 5-minute tick chart courtesy of Brad Robertson — and I’m including it just so you can see the dramatic volume that occurred during the above mentioned time period. Once the COMEX closed at 11:30 a.m. Denver time/1:30 p.m. in New York, volume evaporated.

The vertical gray line is 10:00 p.m. Denver time, midnight in New York — and 1 p.m. China Standard Time [CST] the following day in Shanghai — and don’t forget to add two hours for EDT. The ‘ click to enlarge‘ feature is a must.

Silver was up about 8 cents the ounce by the London open, but was sold down a bit until shortly before 10 a.m. over there. It began to inch higher from that point — and the price action starting just before the noon GMT silver fix — and ending at noon in New York, was rather erratic. It began to edge higher from there until 3:30 p.m. in the very thinly-traded after-hours market — and then traded pretty flat into the 5:00 p.m. close.

Like for gold, the low and high ticks certainly aren’t worth looking up.

Silver closed in New York yesterday at $15.82 spot, up 12.5 cents from Thursday. Net volume was pretty decent, all things considered, at just under 71,000 contracts. That’s a higher volume number than Thursday’s, when the price action in silver was far more dramatic — and I’m wondering what that might mean…or portend.

Here’s the 5-minute tick chart for silver, courtesy of Brad as well — and it’s a very mini version of what happened in gold yesterday. You’ll note that volume dissolved into fumes and vapours once the COMEX closed at 11:30 a.m. MDT.

Like for gold, the vertical gray line is 10:00 p.m. Denver time, midnight in New York — and 1 p.m. China Standard Time [CST] the following day in Shanghai — and don’t forget to add two hours for EDT. The ‘ click to enlarge‘ feature is a must as well.

Platinum was up a few dollars by the Zurich open — and its high of the day at the $897 mark came a few minutes after 10 a.m. CET in Zurich. ‘Da boyz’ and their long knives showed up at that point — and they set the $880 spot low tick a minute or so after 12 o’clock noon in New York. It traded pretty flat from there into the COMEX close and, like the gold and silver, crept higher until 3 p.m. in the very thinly-traded after-hours market. Platinum was closed at $885 spot, down another 7 dollars from Thursday.

Palladium was sold down a few dollars in morning trading in the Far East on their Friday, but began to tick higher around 1:30 p.m. CST over there. It’s high of the day…$1,008 spot…was printed right at the Zurich open, but it was sold down to a dollar below unchanged two hours later. From there it traded flat until the COMEX open. JPMorgan et al showed up at that juncture — and that, as they say, was that. The $989 low tick was printed shortly before 10:30 a.m. in New York — and it chopped higher from there until 2 p.m. in after-hours trading. It traded flat from there into the 5:00 p.m. close. ‘Da boyz’ closed palladium at $997 spot — and down 8 dollars from Thursday.

The dollar index closed very late on Thursday afternoon in New York at 93.76 — and then rallied about ten basis points over the next three hours once trading began at 6:00 p.m. EST Thursday evening. It faded a bit from there until a ‘rally’ began at precisely 2:00 p.m. China Standard Time on their Friday afternoon. That topped out at the 94.09 mark around 12:20 p.m. in London — and then didn’t do a lot until minutes after the job numbers were released in New York. It got sold down hard from there, but the usual ‘gentle hands’ appeared at exactly 9:00 a.m. EST — and the low at that juncture was around the 93.82 mark. It chopped higher until a few minutes after London closed…11 a.m. EST — and it drifted quietly lower for the rest of the day. The dollar index finished the Friday session in New York at 93.90 — and up 14 basis points from Thursday’s close.

And here’s the 6-month U.S. dollar index chart — and the current engineered price declines in gold, silver and platinum have all occurred during this very uninspiring countertrend rally in the dollar index over the last two weeks. And that includes the dramatic, record-breaking — and totally unexpected changes in this week’s COT Report, which I will get to momentarily.

The gold stocks gapped up about a percent and a half at the open — and that was their highs of the day, as they quietly sold off from there until shortly after the COMEX close. At that point the gold price began to rally a bit — and the shares followed it like a shadow for the rest of the Friday trading session. The HUI closed up 0.44 percent.

The silver equities also rallied right out of the chute the moment that trading began in New York at 9:30 a.m. EST on Friday morning. They topped out about 11:50 a.m. EST — and then sold off, like the gold stocks, until shortly after the COMEX close. And with silver and gold following the same price paths after the COMEX close, the silver equities mirrored the silver price — and their golden brethren as well. Nick Laird’s Intraday Silver Sentiment/Silver 7 Index closed up 1.49 percent. Click to enlarge if necessary.

And here’s the 1-year Silver Sentiment/Silver 7 Index. Let’s hope that we’ve seen the bottom in the silver equities. Click to enlarge.

Here are the usual three charts from Nick that show what’s been happening for the week, month-to-date — and year-to-date. The first one shows the changes in gold, silver, platinum and palladium for the past trading week, in both percent and dollar and cents terms, as of their Friday closes in New York — along with the changes in the HUI and the Silver 7 Index. ‘ Click to enlarge‘ for all three.

Here’s the 1-week chart — and it’s pretty ugly.

And here’s the month-to-date chart, which is only one day longer than the weekly chart — and it ain’t pretty, either.

And here’s the year-to-date chart — and it isn’t very happy looking. ‘Da boyz’ actually have silver down on the year — and of course the shares are lagging badly.

As I said last week in this space, the share price action, along with the precious metals themselves, are still in the iron grip of JPMorgan et al — and that won’t change until they’re through doing what they’re doing — and judging by yesterday’s COT Report — and the price action in the precious metals since the Tuesday cut-off, the bottom is within sight, if not already upon us.


The CME Daily Delivery Report showed that only 4 gold and 1 silver contract were posted for delivery within the COMEX-approved depositories on Tuesday. JPMorgan stopped them all for their in-house/proprietary trading account. 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 in December increased by 11 contracts, leaving 2,178 still open, minus the 4 contracts mentioned just above. Thursday’s Daily Delivery Report showed that 62 gold contracts were actually posted for delivery on Monday, so that means that 62+11=73 more gold contracts were added to the December delivery month. Silver o.i. in December fell by 31 contracts, leaving 805 still around, minus the 1 mentioned in the previous paragraph. Thursday’s Daily Delivery Report showed that 54 silver contracts were actually posted for delivery on Monday, so that means that another 54-31=23 silver contracts just got added to December.


There were no reported changes in GLD yesterday, but that wasn’t the case over at SLV, as an authorized participant, most likely with the initials JPM, added 1,509,802 troy ounces of silver.

In the last four business days there have been 5,284,435 troy ounces of silver added to SLV — and that more than covers the 4.5 million ounce increase in the short position in SLV reported two weeks ago for positions held at the close of trading on November 15. I’m expecting the next short report [for positions held at the close of trading on Friday, November 29] from the folks over at the shortsqueeze.com Internet site any day now — and if not this evening, then Monday for sure.

There was no sales report from the U.S. Mint yesterday.

Month-to-date the mint has sold 1,000 troy ounces of gold eagles — 1,000 one-ounce 24K gold buffaloes — and 120,000 silver eagles. Worse than awful.

There was some activity in gold over at the COMEX-approved depositories on the U.S. east coast on Thursday. They reported receiving 96,453.000 troy ounces — and shipped out 26,485 troy ounces. All of the ‘in’ activity…96,453.000 troy ounces/3,000 kilobars [SGE kilobar weight] ended up at HSBC USA. In the ‘out’ category, there was 10,410 troy ounces shipped out of HSBC USA as well — and the remaining 16,075.000 troy ounces/500 kilobars [U.K./U.S. kilobar weight] ended up at Canada’s Scotiabank. The link to that activity is here.

There wasn’t a lot of activity in silver on Thursday. Nothing was reported received — and 412,003 troy ounces were shipped out of Scotiabank. The link to that activity is here.

It was a good bit busier over at the COMEX-approved gold kilobar depositories in Hong Kong on their Thursday. They reported receiving 2,000 of them — and shipped out 4,294. All of this action was at Brink’s, Inc. as usual — and the link to that, in troy ounces, is here.


The Commitment of Traders Report , for positions held at the close of COMEX trading on Tuesday, was a real WTF moment, as I could hardly believe what I was seeing — and Ted was even mores astonished than I.

In silver, the Commercial net short position cratered by an eye-watering 26,721 contracts, or 133.6 million troy ounces of paper silver. That is, without doubt, the biggest one-week decline in COMEX history.

They arrived at that number by adding 9,701 long contracts, plus they reduced their short position by an incredible 17,020 contracts — and the sum of those two numbers is the change for the reporting week.

Ted said that the Big 4 traders reduced their short position by about 6,400 contracts — and the ‘5 through 8’ large traders reduced their short position by around 4,700 contracts. Ted’s raptors, the 36-odd small Commercial traders other than the Big 8, added approximately 15,600 contracts to their long position.

Under the hood in the Disaggregated COT Report, it was all Managed Money traders and then some, as they not only reduced their long position by 12,339 contracts, they also went hugely short as well, adding 22,576 short contracts. The sum of those two numbers…a knee-wobbling 34,915 contracts…was the change for the reporting week. The difference between that number — and the Commercial net short position…8,194 contracts…was made up by the traders in the ‘Other Reportables’ and ‘Nonreportable’/small traders categories, as they went net long that amount.

The other very notable thing I was waiting to see was the remaining long position held by the Managed Money traders — and that number cratered to 57,446 contracts. At the last price low, that number was 56,000 contracts, so all that remains in this category now, are the ‘unblinking’ non-technical Managed Money longs waiting in the weeds.

The Commercial net short position in silver fell to 46,354 contracts, or 231.7 million troy ounces of paper silver. Ted pegs JPMorgan’s short position at around 29,000 contracts, which is an 11,000 contract decline from their short position they held just two weeks ago — and down 7,000 contracts from last Friday’s COT Report.

The Big 8 traders, including JPM, are net short 439.8 million troy ounces of paper silver, or 181 days of world silver production. The difference between that number and what the commercial net short position…439.8 minus 231.7 = 208.1 million troy ounces, is held on the long side by Ted’s raptors, the 36-odd small commercial traders.

Here’s the 3-year COT chart from Nick Laird — and this week’s change is dramatic. Click to enlarge .

I’m totally shocked by these numbers — and words are difficult at the moment. Of course there has been further improvement in the Commercial net short position since the Tuesday cut-off — and what I wouldn’t pay to see what the COT Report looked like at the end of COMEX trading on Friday!!! Ted said that this report passed the ‘duck test’ for what a bottom in silver would look like — and it came with no stand-out changes in the price, which I found shocking. Yes, prices declined during the reporting week, but nothing that would substantiate the internal changes in the COT Report just out. I know that Ted will have plenty to say about this in his weekly review later today.


In gold, the changes were just as stunning. Ted’s estimate of “ 30,000 contracts…and hopefully more ” was totally blown out of the water, as the commercial net short position crashed by 56,651 contracts, or 5.65 million troy ounces of paper gold.

They arrived at that number by adding 15,678 long contracts, plus they decreased their short position by an incredible 40,973 contracts — and the sum of those two numbers is the change for the reporting week.

Ted said that the ‘Big 4’ traders decreased their short position by a whopping 28,800 contracts, or thereabouts — and the big ‘5 through 8’ large traders decreased their short position by around 16,900 contracts. Ted’s raptors, the 47-odd small commercial traders other than the Big 8, added 11,000 contract to their long position.

Under the hood in the Disaggregated COT Report it was, again, a Managed Money show — and much more, as they not only sold 41,344 long contracts, they also added 22,686 short contracts, for a weekly change of 64,030 contracts.

And as incredible as that was, there were two more show-stoppers in the Disaggregated Report — and those were the changes in the other two categories. Yes, as is always the case, they made up the difference between what the Managed Money traders did — and what the commercial traders did…64,030 minus 56,651 = 7,379 contracts. But it was how it was divided up that was an eye-opener. The traders in the ‘Other Reportables’ category went net long 12,942 contracts — and the traders in the ‘Nonreportable’/small trader category went net short by 5,563 contracts. I’ve never seen such a dichotomy in the numbers between these two categories — and unless its a reporting error that will be corrected next week, these changes are astounding as well.

The commercial net short position in gold fell all the way down to 18.99 million troy ounces.

Here’s the 3-year COT Report for gold — and it’s as equally amazing as silver. And, like silver, there have been further improvements since the Tuesday cut-off. And also, like for silver, my kingdom…such as it is…for just a peek at a COT Report in gold as of Friday’s close!

As Ted said on the phone yesterday, this was JPMorgan pulling off every dirty trick in the book behind the scenes to cover their massive short positions in what was probably their last swing for the fences. I’ll go one step further than that. I suspect that this was a co-ordinated and ca

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