Tuesday, June 7, 2016

China may finally be making its move to clean out the physical gold from the U.S. Comex

One of the more interesting dichotomies regarding the U.S. Commodities Exchange (Comex) is that for several years now, the institution has been selling futures contracts on precious metals like gold and silver and rarely ever delivering anything when the monthly expirations came due.  In fact, according to statistician and financial analyst Dr. Jim Willie, the Comex had only performed cash settlements for gold futures contracts and hasn't actually delivered any metal for more than two years.

But this may be changing.

Entering into the June delivery month, Chinese gold contracts at the Comex have suddenly shifted into the deliverable category, rather than simply being rolled over at the time of expiration like they have for the past few years, and it could very well mean that the time for China to drain the Comex of all its gold is finally at hand.

The June gold contract is an active contract and the second biggest delivery month of the year following December. Friday night, the bankers first day delivery issuance to our longs to be settled on June 1 was huge: the number was  3,508 gold notices for 350,800 oz or 10.9 tonnes of gold. On day two, we had another huge number of gold notices filed at 2281 for 228100 oz or 7.09 tonnes of gold. 
On day 3,THURSDAY, we had another whopper of 1969 notices for 196,900 oz or 6.12 tonnes. 
FRIDAY, saw another huge 1026 notices filed for 102600 oz (3.19 tonnes). Then on 
Friday night we had a whopping 2981 notices filed for Monday totaling 2981 contracts for 298,100 oz. 
Thus in 5 days a total of 11,765 notices have been filed for 1,176,500 oz or 36.59 tonnes. WHAT IS MORE FASCINATING WAS THE FRONT JUNE MONTH  INCREASED IN NET OI BY 678  CONTRACTS ON THURSDAY(67,800 OZ).  ON FRIDAY IT INCREASED BY 78 CONTRACTS OR 7800 OZ AND TODAY IT INCREASED BY 264 CONTRACTS OR 26400 OZ. THE ENTITY STANDING DOES NOT WANT FIAT AND IT SURE LOOKS LIKE A SOVEREIGN (CHINA) IS STANDING FOR GOLD. – Silver Doctors
The significance of this move is that according to the Comex, there are demands for delivery of 48 tons where the registered total available inside the exchange is only 50 tons.
We thus have 48.11 tonnes of gold standing for JUNE and 50.61 tonnes of registered gold for sale, waiting to serve upon those standing.  The bankers are still doing their best in cash settling as there is not enough registered gold to satisfy those that are standing.
Does this sudden demand for delivery after years of rolling over gold contracts now signal a move by China to drain the Comex and begin the transition to Shanghai to control the pricing of the precious metal?  I believe we shall soon find out.

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