The December futures roll was also one for the ages. On Nov. 20 there were 162,509 December contracts, and now we go into first day notice Friday with 11,524 standing. That is still enough to be disruptive and take all Crimex deliverable gold. Incredibly, only about 30% of these Dec. contracts rolled out to the next active month: 190,037 to 237,973. Open interest is back to 378,076. So that means a large portion of the Crimex trade closed positions (long and/or shorts) and simply left the field.
But who did it? As it stands today we have no idea who or how they are positioned. If it was swap dealers or producers and merchants greatly reducing shorts relative to small speculators and managed money slingers, then a great trap has been sprung. Par for the course, Tuesday’s big activity will not be revealed before the close Friday because of the holiday, but instead on Monday after the Swiss vote is revealed. Who is trying to screw who is the question, and who will succeed?
The clues from the GOFO are straightforward and shocking: The paper gold freak show continued unabated: 1 MONTH -0.34%; 2 MONTHS -0.24%; and 3 MONTHS -0.16%.
Thursday deliveries on the Shanghai were very substantial at 13.90 tonnes.
Update on so-called institutional sells throughout the high volume GDX, GDXJ algo drubbings reveals virtually no selling in the names I use and follow. I submit that the November trashings were totally manipulated, contrived and little more than a crime scene.
Is there another paper-scam plunge waiting out there to trump the real market? I really don’t know and can only show the clues. For me, the longs would have a big advantage in these games. I do believe these paper schemes are running on empty and are completely counter to the laws of economics. We now have cover ups laid upon cover ups. However, my grasp of economic law has made me wrong more than once in the current reign of the freak show.
