Archive for the ‘Quants’ Category

Metals Retreat; West Bank Palestinians Advance

Posted by on July 25th 2014 in CFTC, China, CME Group, General Economy, Gold, IMF, Middle East, Quants, Short Sellers, Silver, Ted Butler, Wall Street | Be the first to comment!

MetalsRetreatPalestiniansAdvance

Gold and silver ended down about 1% and 2.5% respectively on Thursday, representing a buying opportunity for one scribe, as global strife took a back seat to what was seen as positive economic news from the eurozone and China, and on U.S. jobless claims hitting an eight-year low.  But citing earlier “negative surprises” from the U.S. and Chinese economies, and ongoing geopolitical risks, the IMF lowered its global growth forecast for 2014.

With gold dropping below $1,300 and stalling at its 200-day moving average, Reuters quotes one observer as saying, “To be fair, I think some people have a right to be disappointed that the stresses around the world haven’t led to a continued rise in the price of gold. We’re probably in oversold territory right now where gold is concerned, but we also seem to be pulling into an area between $1,290 and $1,280 that should offer some support to the market.”

See also:

Dan Norcini/Reuters:  China gold demand slumps 19.4 pct on yr, but output rises

Ted Butler:  Silver tightness

Hard Assets Investor:  Gold’s fair value – bear says $800, bull says $5,000

Investing.com/SafeHavenHappy markets in an unhappy world; Clear and present danger zone

Bloomberg/Business Insider:  Don’t tell anybody about this story on HFT power Jump Trading, one of 10 being eyed by the SEC

Wall Street On Parade:  Lawsuit stunner – Half of futures trades in Chicago are illegal wash trades

Metals Up After 2-Day Drop; Indian Gold Surge

Posted by on July 17th 2014 in China, Federal Reserve, General Economy, Gold, India, Janet Yellen, Monetary Policy, Quants, Short Sellers, Silver, Wall Street | Be the first to comment!

IndianGoldSurge

Both spot gold and silver were up a fraction on what Reuters describes as “bottom-picking” following two down days, but gold’s rally was said to have “faded after data showed U.S. manufacturing output rose at its fastest pace in more than two years in the second quarter,” and following a talk by Dallas Fed President Richer Fisher in which he said that the Fed was “likely” to start raising interest rates early next year. Over at Bloomberg things were shinier for gold as it highlighted a report that Indian imports surged 65% year-over-year in June.

See also:

The Gold Report:  Editor- Upward trend a silver investor’s friend

Mineweb/GATA:  Bulls might take heart from latest gold smashdown failure; The more obvious they are, the closer the day of deliverance

Bullion Bulls CanadaThe end of the paper-gold market?

Zero Hedge/CSM:  Shocking first – Mainstream media rushes to defend dollar reserve status; Can BRICS development bank become a rival to the World Bank?

Jesse’s Café Américain/Nanex:  The stock market is rigged, with details

Wall Street on Parade:  Sen. Warren lets Yellen know she’s had it with Fed’s charade about too big to fail

Metals Nixed, but News is Mixed

Posted by on July 15th 2014 in CFTC, CME Group, Federal Reserve, General Economy, Gold, Janet Yellen, JPMorgan, Monetary Policy, Quants, Short Sellers, Silver, Ted Butler, Wall Street | Be the first to comment!

MetalsSlammedLower

Spot gold and silver dropped more than 2% on Monday, with one stated reason being an easing of problems in Portugal’s banking sector, which may still be far from solved. But arguably having little to do with Portugal, there was “massive selling in the futures market. Reportedly, 2300 futures contracts, with a notional value of $1.4 billion, were sold at the New York open,” according to USA Gold:  “We’ve seen such raids in the paper market in the past. Throwing this kind of volume at the market all at once is reflective of someone not interested in getting the best price, but rather someone looking to generate shock and awe.” But while gold was being shocked and awed to its worst day in 2014, U.S. Mint bullion coin sales jumped, and GLD, the major gold ETF, was said to have seen its largest inflow since August 2011.

See also:  

Ted Butler:  The silver conspiracy

Bloomberg:  Goldman stays gold bear as bullish wagers increase; Individuals pile into stocks as pros say bull is spent

Reuters:  Yellen says Fed easy money needed even after recovery – New Yorker

Business Insider/Zero HedgeNew Yorker article seen igniting CNBC shouter; Rick Santelli goes beserk

BullionStar.com:  Koos Jansen – For how long will people trust fiat money?

Metals Pop on Problemo Banco

Posted by on July 11th 2014 in CFTC, China, CME Group, ECB, Federal Reserve, General Economy, Gold, Janet Yellen, Monetary Policy, Quants, Short Sellers, Silver, Wall Street | Be the first to comment!

'Espirito' Moves Gold & Silver

Gold futures added 1.1% to approach four-month highs on Thursday and silver surged 2.1% after a parent company of Portugal’s Banco Espirito Santo “delayed debt payments on short-term notes, fueling concern that the euro region remains vulnerable to financial shocks,” reports Bloomberg, quoting one trader’s observation that “Equities are getting hammered, and we are seeing a flight to safety.”

“We did have a strong gold rally during the last period of sovereign risk in Europe, so it’s not surprising to see the market reacting like this,” said HSBC metals analyst James Steel, adding, “But to be fair, gold has been trending higher for a while now and there aren’t too many sellers to stand in the way with the geopolitical crises of the Middle East and Europe and the Fed’s insistence that higher U.S. rates are still way off.”

See also:

Barron’sFed policy to boost gold, silver (click thru for article)

Silver News Blog/SilverSeek:  Silver keeps chugging along; Steve St. Angelo:  Silver will be the king precious metal performer

Got Gold Report:  Swap dealers ‘goal line stand’ for Comex silver futures in jeopardy, short squeeze very possible now

Trader MC:  Metals and miners bull market point of recognition

Acting Man/Economic Collapse Blog:  Janet Yellen chimes in on the bubble question

Zero Hedge:  Did China just crush the U.S. housing market?; “Unrigged?” The bulk of odd lot trades on U.S. exchanges are one-share-lots!

Bloomberg:  Chicago Fed calls for curbs on high-frequency trading

Ted Butler: Current Silver Setup the ‘Best in History’

Posted by on June 28th 2014 in CFTC, Gold, JPMorgan, Quants, Short Sellers, Silver, Ted Butler, Timothy Massad, Wall Street | Be the first to comment!

SilverSetup

With gold and silver futures posting their longest run of weekly gains since January, MarketWatch‘s “Commodities Corner” column looks at “Why silver’s outperforming gold and isn’t done yet,” and Ted Butler declares that “there has rarely been a better time to buy and hold silver because the sharp price decline has created an undervaluation that I never expected.”

Describing the two categories of traders known as “raptors” and “technical funds,” Butler explains that “The raptors who are long have the technical funds who are short over a barrel. It’s only a matter of time until the raptors decide to ring the cash register by orchestrating higher silver prices. This will cause the technical funds to buy back their silver short position. Because the technical funds hold a record silver short position, this makes the current setup the best in history. Make no mistake, the technical funds must buy back, rather than deliver metal to close out their short position. As a result, there is now the largest amount of potential buying power in history. Silver should surprise to the upside at some point soon.”… Read More >>>

Chinese ‘Unwind’: A Great Leap Forward for Gold and Silver?

Posted by on June 27th 2014 in China, Federal Reserve, General Economy, Monetary Policy, Quants, Short Sellers, Silver, Wall Street | Be the first to comment!

GreatLeapForward?

Spot gold and silver ended mixed on Thursday, with silver up and gold down, each by about a quarter of a percent. St. Louis Fed President James Bullard talking up higher interest rates was seen weighing on gold, but the big news was a report that Chinese gold processing companies used falsified gold transactions to borrow about $15 billion from banks, which was said to be either good or bad for gold, and by extension silver, depending on the source and the timeframe.   “If China continues to clamp down on these financing deals, it would likely be negative for the gold price in the short run,” according to one analyst, reasoning that “More gold will be available on the market and less demand for gold from these financing deals.” But another tells MarketWatch that “The Chinese story is a likely bullish force for gold and may partially explain the massive buying behind the June 19 rally.”

CCFDsGoodForMetals?

And that $15 billion may be just the tip of the iceberg.  Citing a Bloomberg article on the “fake gold trades,” Zero Hedge notes that “As much as 1,000 tons of gold may have been used in lending and leasing deals in China, and Goldman reports that up to $80 billion false-loans may involve gold. As one analyst noted, this was unlikely to have a significant impact on the underlying demand for gold in China, and as we have pointed out before, any unwind of the gold CFDs would lead to buying back of ‘paper’ gold hedges and implicitly a rise in prices….So unlike in the industrial commodities – where the CCFD unwind drives prices down as the image above shows, thanks to synthetic manipulation and domination of the paper gold (and silver) market, the opposite occurs in precious metals.”

But apparently taking aim at Zero Hedge, without naming it, Dan Norcini comes down on the other side:  “The usual ‘we have never seen a story concerning gold that we could not spin to make it bullish’ website somehow manages to contort this story as friendly! Just use common sense and do not get lost in the weeds with their ‘logic’ and you will see what it is that has been lurking out there in the minds of metals traders. They are understandably nervous about this.”

And while it certainly won’t be the last word on the subject, today’s comes from that “oasis of civility,” Jesse’s Café Américain, which offers “Some thoughts on leverage in the great gold and silver frauds.”

Metals Rebound on GDP Tank

Posted by on June 26th 2014 in CFTC, China, Federal Reserve, General Economy, Gold, Janet Yellen, JPMorgan, Quants, Short Sellers, Wall Street | Be the first to comment!

GDPtank

Gold and silver pared losses on Wednesday to end slightly up after data showed that U.S. GDP for the first quarter fell 2.9%, and the dollar dropped with it.  USA Gold, describing what it calls “this stunning collapse in economic activity,” cites Jim Rickards’ “prescient assertion early in the new year that the Fed was tapering into weakness, and in doing so before achieving their own growth and inflation criteria. ‘The danger now is that they cause a recession,’ Rickards stated in a February interview. I wrote last week that gold’s gains back above the $1300 level significantly improved the technical picture and went a long way toward confirming the cycle lows at 1182.10/1179.83. The latest “In Gold We Trust” report from Incrementum AG of Lichtenstein [see below] seems to agree: “We are therefore convinced that the technical picture has been repaired and that a stable bottom has formed.”

See also:

Bloomberg/Zentrader:  Gold euphoria won’t last with Yellen’s rally fading; Few believe gold can shine

Jim Sinclair: 30 reasons the bear phase in gold ends this summer

SilverSeek/Mining.com:  Has key to silver ‘bet’ finally changed?; Is silver the cure for silver prices?

CDN/Reuters:  Germany’s missing gold; Singapore vie for Asia gold pricing alternative to London

Zero Hedge:  Chairman of China’s largest copper producer commits suicide by jumping from hotel

New York Times:  Barclays faces New York lawsuit over dark pool and high-frequency trading

Metals Get Wound UP; Hypotheses Include Rehypothecation Unwind

Posted by on June 20th 2014 in CFTC, China, Federal Reserve, General Economy, Gold, Monetary Policy, Quants, Short Sellers, Silver, Wall Street | Be the first to comment!

MetalsGetWoundup

After silver and gold soared 4% and 3% on Thursday, Reuters quoted one commodities broker as saying “The Fed statement and geopolitical tensions sparked a frantic reversal in market sentiment.” But Jesse at his Café Américain isn’t so sure those were the flashpoints. While acknowledging that “Today was nice. It would have been nicer to have known why the metals moved so violently higher today, in what certainly turned into short covering….I don’t think the Fed’s statement yesterday is what caused this, but it is the go to plug for those who have to say something. Anyone who thought the Fed would do anything else must be a tourist. I am leaning toward the unwind of commodity rehypothecation in China, as is Zero Hedge, but it bothers me that so far it is all base metals being discussed. We know there is a lot of leverage in the precious metals.”

But what were seen as gold-friendly comments by Fed Chair Yellen,”caught a lot of traders leaning the wrong way,” observes Dan Norcini:  “Most everyone expected the Fed to announce further tapering, which they did, to the tune of another $10 billion/month reduction. But most expected the Fed to sound a more upbeat tone about the economy and begin to start preparing the markets for an eventual rate hike. Quite the opposite happened. Disappointed traders, or better yet, shocked traders, ran for cover.”

See also:

Barron’s/GATA: GLD, established in 2004, has its 14th biggest move, ever; China gold association chief talks gold down on its biggest day of the year – They haven’t gotten all they want yet

EconMatters:  Gold becomes inflation hedge as bond markets manipulated by central banks

SilverSeek/Got Gold Report:  June lows often mark the beginning of a long rally in gold and silver; COMEX Managed Money record silver shorts more like insurance than a one-way bet

Short Side of LongConsider purchasing metals

Reuters/Wall Street on Parade:  Sources – FX chatrooms show traders shared order, price details; Virtual corporate media blackout of Senate hearing on high-frequency trading

Metals React Positively to ECB Going Negative

Posted by on June 6th 2014 in CFTC, China, ECB, Federal Reserve, GATA, General Economy, Gold, Monetary Policy, Quants, Short Sellers, Timothy Massad, U.S. Congress, Wall Street | 1 comment

LessThanZeroGold and silver futures gained 0.7% and 1.6% respectively on Thursday, after the the ECB cut interest rates from 0.25% to 0.15%, and dropped the rate on  overnight deposits to negative 0.1%, which was described as an “historic step” that “signals strange economic times.” But the moves were also seen as a “disappointment” for not going far enough, with the euro rebounding to hit a ten-day high. And according to a Bloomberg report, the ECB’s action “probably won’t quell calls for more radical measures such as quantitative easing to stop the euro area from sliding into deflation.”

And while gold’s gains were said to be “coming mainly from short covering and not from a huge throng of eager new buyers,” it was also suggested that gold and silver “took a hit the past couple of days after option expiration to dampen any rally possibilities over what should surely be a big positive for the precious metals.” Gold Newsletter‘ editor Brien Lunden agrees, telling MarketWatch that “since gold responds over time to increases in the supply of fiat currency…. Increasing amounts of euros, as well as dollars, yen and other currencies, will raise the relative value of ‘things’ — and especially gold.”

See also:

GoldSeek/Mineweb:  When money printing runs wild; Despite gold’s fall, fundamentals suggesting rebound – but when?

Dow Jones/Bloomberg:  Two more declare interest in overseeing London silver fix; Silver electronic auction favored as replacement for fix

AP/Law 360:  Senate confirms Timothy Massad to head CFTC

Wall Street on Parade/CNBC:  Was that really a public meeting on high frequency trading?; Here are the 24 stocks high-speed traders love

WSJ:  Bill Gross – I don’t own a cellphone

Metals Fail to Recover from AM Slam

Posted by on May 28th 2014 in CFTC, China, ECB, Federal Reserve, General Economy, Gold, Monetary Policy, Quants, Russia, Short Sellers, Silver, Wall Street | Be the first to comment!

MetalsFailToRecoverFromAMslam

As gold and silver futures were on their way to falling 2% and 1.8% respectively on Tuesday, Zero Hedge illustrated and explained that Tuesday became a re-run of last Friday, when “like clockwork, as 8am ET rolls around gold and silver become the object of derision for some entirely unrigged decision-maker at a bank, pressing gold prices down to 3-month lows…. With $450 million notional flushed through futures contracts, someone was in a hurry after seeing Europe’s extreme left and right uprising to unload any protection against an ECB capable of only one trick to save the world.”

See also:

BullionVault/Dan Norcini: Gold prices sink on options expiry after strong U.S. data, weak Hong Kong imports; Gold gives up Ukraine premium as bears growl

PRI/McClatchy:  Ukraine has a new president, but it still simmers with tension; Ukraine says hundreds of armed militants have crossed border from Russia

Reuters:  Putin says Russia and China need to secure their gold and currency reserves; With London “fix” under fire, China seeks bigger sway in gold trade

Mineweb:  Lawrence Williams – Austria seeks audit of its Bank of England held gold

Mike Shedlock/Bloomberg:  Former Bundesbank VP recommends gold, says current economic system is “pure fiction”; Bad credit no problem as balance-sheet bombs rally 94%

Reason TVThe Death of MoneyQ&A with Jim Rickards

The “Fix” is … Out!

Posted by on May 15th 2014 in CFTC, China, General Economy, Gold, India, Monetary Policy, Quants, Short Sellers, Silver, Wall Street | Be the first to comment!

SilverFixOut

“The silver market is poised to undergo a major shake-up, as the ancient method of setting a benchmark price is coming to an end,” reports the Financial Post, on news that the company running the London silver “fix” is calling it quits, as of August 14.

“The silver fix is now dying because the banks that set the price don’t want to do it anymore,” continues the Post‘s report, “and no one else is rushing forward to take their place. Last month, Deutsche Bank said it planned to give up its seats on the silver and gold fixes as it scaled back its commodity business. That left only two banks to determine the silver fix: Bank of Nova Scotia and HSBC. Now all of the parties have decided to withdraw.”

The article quotes precious metals dealer Nick Barisheff as calling the fix “a decent system if everybody is playing above board. But it allows room for playing around, just as the lawsuits criticize.”  And as for what might replace it, Reuters suggests that an “electronic alternative” is in the offing, and one of its researchers tells the Globe & Mail that “The market is not going to collapse because this piece of information is not there. There will be more uncertainty, but ultimately these are prices that trade 24-7.”

See also:

Dan Norcini/MarketWatchPPI numbers send precious metals higher; Silver highest in a month; gold tops $1,300 level

Coin News/Mineweb:  Gold hits 1-month high, U.S. Mint bullion coins gain; Lawrence Williams – Gold’s pent-up demand

Zero Hedge:  From Rothschild to Koch Industries: Meet the people who “fix” the price of gold

Wall Street on Parade:  CME Group head tells Senate futures markets not rigged; Traders file lawsuit alleging “clandestine” conspiracy

Yahoo News/Times of IndiaDubai goes for gold; The story of Indians and gold in Dubai

Scrap Monster:  Gold smuggling in India spikes 446% in last 12 months; Wanted- The most notorious gold smuggler

Metals Gain on Week; Gold as the ‘Unsure-ance’

Posted by on April 26th 2014 in CFTC, China, Federal Reserve, General Economy, Gold, Monetary Policy, Quants, Russia, Short Sellers, Silver, Wall Street | Be the first to comment!

 GoldAsTheUnsureAnce

Gold and silver ended up about a half a percent on the week, with gold closing at $1,300 on Friday, reports Reuters, “as violence in Ukraine boosted bullion’s safe-haven appeal, and weakness in equity markets also supported gold.”

And with the U.S. dollar said to be in a “coma,” USA Gold reminds that “The major central banks have been quite clear; they don’t want you buying their currencies, as safe-havens or for another other reason. They’re prepared to further debase their currencies and make you suffer if you don’t heed them. Buy gold instead. It has been a safe-haven far longer than any of those fiat currencies have even existed.” The article also cites a recent chat with Grant Williams, who dubs gold the “unsure-ance,” and suggests that “if you’re 20% unsure about the future, you might consider putting 20% of your assets in gold.”

See also:

Dan Norcini/Mineweb:  Safe-havens boost gold; In destabilizing economic war over Ukraine, gold the winner

Bloomberg/SRSrocco Report:  Traders betting silver prices will rise with gold on inflation, overseas demand & Ukraine; The decline in Shanghai silver inventories picks up speed

Zero Hedge:  PBOC pressures USD hegemony; Starts yuan-denominated gold & oil trading

MarketWatch/SilverSeek:  Peter Schiff – Reckless Fed may push gold to $5,000; Are ‘dollar bugs‘ insane? Blind?

Reuters:  U.S. lawsuits hobble Deutsche Bank’s bid to sell gold fix seat

Visual Stories/Wall Street on Parade:  When will capitalism come to Wall Street?; Did the SEC admit that it knows the stock market is rigged?