“Backwardation” in Physical Gold Above $18 vs COMEX/LBMA Paper
Gold closed at $1189.10 down $21.90
silver closed at $16.38: down $0.24
Access market prices:
THE DAILY GOLD FIX REPORT FROM SHANGHAI AND LONDON.
The Shanghai fix is at 10:15 pm est and 2:15 am est
The fix for London is at 5:30 am est (first fix) and 10 am est (second fix)
Thus Shanghai’s second fix corresponds to 195 minutes before London’s first fix.
And now the fix recordings:
Shanghai morning fix Nov 23 (10:15 pm est last night): $ 1230.45
NY ACCESS PRICE: $1214.70 (AT THE EXACT SAME TIME)/premium $15.75
Shanghai afternoon fix: 2: 15 am est (second fix/early morning):$ 1231.70
NY ACCESS PRICE: 1213.60 (AT THE EXACT SAME TIME/2:15 am)
HUGE SPREAD 2ND FIX TODAY!!: $18.10
London Fix: Nov 23: 5:30 am est: $1213.25 (NY: same time: $1213.20 5:30AM)
London Second fix Nov 23: 10 am est: $11.85.35 (NY same time: $1187.10, 10 AM)
It seems that Shanghai pricing is higher than the other two , (NY and London). The spread has been occurring on a regular basis and thus I expect to see arbitrage happening as investors buy the lower priced NY gold and sell to China at the higher price. This should drain the comex.
Also why would mining companies hand in their gold to the comex and receive constantly lower prices. They would be open to lawsuits if they knowingly continue to supply the comex despite the fact that they could be receiving higher prices in Shanghai.
Let us head over to the comex:
The total gold comex open interest FELL by 21,657 CONTRACTS to an OI level of 461,062 DESPITE THE FACT THAT GOLD ROSE $1.40 with YESTERDAY’S trading. I expect that the next reading on Friday will see a further deterioration in OI.In the front month of November we had 27 notices standing for a GAIN of 10 contracts. We had 0 notices served YESTERDAY so we GAINED 10 GOLD CONTRACTS OR AN ADDITIONAL 1000 OZ WILL STAND FOR DELIVERY IN THIS NON ACTIVE DELIVERY MONTH OF NOVEMBER. The next contract month and the biggest of the year is December and here this month showed a DECREASE of 35,251 contracts DOWN to 164,500. The December contract month is still highly elevated compared to a year ago. On TUESDAY Nov 24/2015 comex reading day, we had a total of 101,283 contracts standing ( a loss of 31,877 contracts from Nov 23/2015. It certainly emphasizes the huge demand for physical gold.We have exactly 5 more trading days and it matches last’s year with 5 trading days left. THIS SHOULD EXPLAIN TO YOU WHY THE BANKERS ARE CONSTANTLY WHACKING OF GOLD (AND SILVER): THE HIGH OI FOR DECEMBER AND THE HIGH PROBABILITY THAT MANY WILL TAKE DELIVERY.
Today, we had 16 notice(s) filed for 1600 oz of gold.
And now for the wild silver comex results. Total silver OI ROSE by 709 contracts from 168,952 UP TO 169,661 as the price of silver ROSE BY $0.11 with YESTERDAY’S trading. We are moving further from the all time record high for silver open interest set on Wednesday August 3/2016: (224,540). The front month of November had an OI of 1 and thus a LOSS of 3 contracts. We had 0 notice(s) filed yesterday so we LOST 3 contracts or an additional 15,000 oz will NOT stand for delivery in this non active month of November. The next major delivery month is December and here it FELL BY 7974 contracts DOWN to 48,378. The December contract month is about even compared to a year ago. On Nov 24/2015 reporting day, we had a level of 43,067 contracts having lost 12,477 contracts on the day).
In silver had 0 notice(s) filed for NIL oz