First of all, I would like to wish our American friends a very happy and safe July 4th holiday weekend.
Due to this holiday, the FDIC decided to give the boys an extra week off so there were no bank failures listed on Friday night.
Even though there was no jobs report the bankers decided that a raid on the precious metals was necessary.
You could tell a raid was on by the attack of gold and silver in Asia on Thursday night. Gold finished the comex session down $20.00 to 1482.30 for a loss of $20.00. Silver also fell badly down $1.11 to $33.79. Silver has a good resistance level around 33.00 and gold at $1480.00 Both levels held nicely.
Let us proceed to the comex and see the damage. I will also highlight a stunning COT report and then present a blockbuster Rob Kirby report on the bank derivatives.
The total gold comex OI on Friday showed a huge drop to 491,065 from 498,789 and this is basis Thursday night. You can just imagine what Monday's reading (basis Friday) will show. The front options delivery month of July saw the OI fall from 159 to 83 for a loss of 76 contracts. We had 100 deliveries so all of the loss was picked up by the drop in OI and we did gain some gold ounces standing.
The next big gold delivery month is August and here we witnessed the damage as the OI dropped from 315,635 to 307,194 as many speculators are fleeing the scene. The estimated volume came in at 137,322 for Friday and the confirmed volume for Thursday was 154,540.
The total silver comex OI continues to contract. The total OI for Friday (basis Thursday) resulted in a total OI of 110,978 a drop of 1097 contracts from Thursday. We should see another minor drop on Monday's reading. The front delivery month saw a big drop in OI from 2397 to 1860 or 537 contracts.
Since we had only 110 deliveries, Blythe Masters must have been very busy with her fiat check-book convincing silver longs to take fiat. The next delivery month for silver is Sept and here we witnessed a drop from 57,223 to 56,800 for a loss of only 400 contracts. Some of our fiat recipients moved into Sept once they settled their July contracts. The estimated volume at the silver comex was extremely low at 45,794. It seems that the speculators have left this arena. The confirmed volume on Thursday was also anaemic at 49,560. Due to the huge margin increases, silver is moving more and more into a physical market.
Again in gold we continue to see no gold deposits into the dealer.
For that matter, we also saw no gold leave a dealer's vaults.
The only activity was a rather large 159,779 oz from Scotia and a tiny 32 oz from Manfra.
Thus, total withdrawal by the customer amounted to 159,811 oz.
There was a counting error removal of 497 oz out of the customer gold inventory as an adjustment.
The comex folk notified us that a total of 17 notices were filed for 1700 oz of gold. The total
number of notices filed so far this month total 100 for 10,000 oz.
To obtain what is left to be served upon, I take the OI standing for July (83) and subtract out
Friday"s deliveries (17) which leaves me with 66 notices or 6600 oz left to be served upon.
Thus the total number of gold oz standing in the month of July is as follows:
10,000 oz served + 6600 oz (to be served) = 16,660 oz or .516 tonnes.