SLV ETF Has Another Monstrous Withdrawal

Gold made it up to $1,160 in early London trading on Thursday morning... and didn't do much until it's high price tick of $1,163.00 spot at 8:30 a.m. in New York, when the gold price had it's usual Comex sell-off that came to an end at 11:00 a.m.... which was also it's low of the day... $1,151.20 spot. From that low, gold rose quickly back to $1,160 spot before drifting lower into the close. And, as the chart below shows, gold traded a similar pattern in New York on Monday and Tuesday as well.

Silver's rally at the London open took it up to $18.45 spot... and [within a nickel] that's where the price stayed for the rest of Thursday's trading session... all the way up to the close of electronic trading in New York at 5:15 p.m... eleven hours later. Nothing to see here, folks... please move along.

The dollar rose about 25 basis points between midnight and 10:10 a.m. in New York... and from that high, the dollar lost over 40 basis points in the next ninety minutes. It's unusual to see gold crater at the same time as the dollar does a face plant... but with the bullion banks lurking about, anything's possible.

The HUI pretty much followed the gold price yesterday... and finished up 0.90%.

As I mentioned yesterday, I didn't expect much change in open interest... and there wasn't. Gold open interest rose 356 contracts on volume of 140,269 contracts. Silver o.i. actually fell 619 contracts on very large volume of 57,820 contracts... of which almost 25% were roll-overs into July and later months. We're now half way through April... and May is a delivery month for silver. You can see that the activity level is picking up as we approach options expiry [April 28th] and first notice day... April 30th.

The CME Delivery Report shows that 101 gold and 49 silver contracts are up for delivery on Friday. So far this month, 453 silver contracts have been delivered on the Comex. That's 2.3 million ounces... which ain't too shabby for a non-delivery month for silver... and the month is only half over. There were no changes reported in GLD yesterday... but the SLV had another whopping amount of silver taken out of it. This time it was an eye-watering 3,431,792 troy ounces. That's two full days of world silver production! Since February 26th... 14.4 million ounces of silver have been withdrawn from SLV by the 'authorized participants' because silver in quantity is not available anywhere else. The U.S. Mint had no report on Wednesday... but the Comex-approved depositories indicated that 367,866 ounces of silver were withdrawn on Tuesday. There was a lot of in-and-out activity... and if you want to see it for yourself... here's the link.

I only have two gold-related stories today... and the first one is in London's Financial Times. Gold Field Mineral Services [GFMS] is up to their old tricks... being negative about the gold price. Of course, they've been negative about the price from the time it broke through $300 ten years ago... so why should they change their tune now. The headline reads "Record gold prices unsustainable"... and the link is here. I thank the usual N.Y. gold commentator for bringing it to my attention.

Here's a Reuters piece filed from New Delhi yesterday afternoon. It bears the headline "India's March gold imports up nearly 6-times year/year"... "Gold imports in March rose to 27.7 tonnes against 4.8 tonnes a year ago, Suresh Hundia, president of the Bombay Bullion Association (BBA) said on Wednesday." The story was posted over at Kitco... and the link is here.

The next story today is a Bloomberg piece courtesy of Russian reader, Alex Lvov. It was filed in the wee hours of this morning and bears the headline "U.S. Foreclosure Filings Rise 16% as Bank Seizures Set Record". "A total of 932,234 homes, or one out of every 138 households, received a default or auction notice, or were repossessed by banks, said Realty Trac... the Irvine, California-based firm said yesterday. In March, filings rose 8 percent to the most in any month since RealtyTrac began publishing reports in January 2005." This story is worth running through... and the link is here.

The next story is about the huge sovereign debt problem that looms over just about every nation on earth. It's a fairly long piece posted over at zerohedge.com... and I thank Australian reader Wesley Legrand for sending it along. The headline reads "Grice: "What Is The Difference Between Greece And Rest Of The OECD? Only That It Is Small Enough To Be Bailed Out". There are some wonderful graphs [some of which you have to click on to see them all... as they are partially buried under the right sidebar] that visually show the total hopelessness of the situation. The link is here.

The ghosts of Washington Mutual and Countrywide Financial Corp. are still skulking about. Here's a story that appeared in Tuesday's Los Angeles Times. The headline reads "Washington Mutual created 'mortgage time bomb,' Senate panel says". "The failed bank made subprime loans it knew were likely to go bad and then packaged them into risky securities, investigators say." I thank reader "Verne in Ventura" for sharing it with us... and the link is here.

Here's a story that I just received from reader Bittar Gabriel at 4:24 a.m. this morning. The story is posted over at swissinfo.ch... and the headline reads "Shareholders hold UBS ex-bosses accountable" ... "At the bank’s annual general meeting on Wednesday, shareholders voted against exonerating the bank’s 2007 management, which includes former chairman Marcel Ospel, from all blame. The rebellion opens the door to possible civil or even criminal law suits." Great! Let's hope some of these guys end up in jail... and the link to the story is here.

Today's last story is courtesy of reader Scott Pluschau. It's a Reuters piece bearing the headline "Markets could be derailed again, warns Soros". Financier George Soros delivered a stark warning on Tuesday night that the financial world is on the wrong track and that we may be hurtling towards an even bigger boom and bust than in the credit crisis. [Note to George: Please tell us something we don't know. - Ed]. It's a very short piece... and the link is here.

Freedom is never more than one generation away from extinction. We didn't pass it to our children in the bloodstream. It must be fought for, protected, and handed on for them to do the same. - Ronald Reagan

Nothing much happened in Far East trading earlier today... and it's more of the same at the London open. As of 4:36 a.m. Eastern time, volume in gold is an extremely light 11,900 contracts... and silver's volume net of spreads is around 3,200 contracts.

As you are aware, dear reader, the bullion banks have been piling on the short positions in both gold and silver during their respective rallies that began on February 7th, so I'm sort of on the lookout for an attempt by them to rig a sell-off... which they are quite good at. Although JPMorgan appears to not be adding to their short positions on this rally in both metals, they still sit on a huge short position [especially in silver]... so nothing would surprise me when it comes to the price action as we head into the May delivery month for silver. And to top it all off... tomorrow's Commitment of Traders report will be wall-to-wall ugly in both silver and gold.

Preliminary volume numbers for Wednesday's trading show that 135,879 contracts in gold were traded... and silver's volume was a chunky 45,578 contracts.

That's it for today... I'm off to bed. See you on Friday.