Just some food for thought this morning while I prepare the rest of the week’s content (if you haven’t yet, read Chris DeMuth’s takes from yesterday - one of his long ideas was up 10% yesterday and is set to open up another 4% this morning & he thinks it is still a double or more from here).
But I wanted to pass along this chart, which was pointed out on Twitter by @dimit a couple of days ago. It shows Comex weekly gold deliveries breaking their 30 year range ceiling easily. They note the paper to physical ratio is 100:1, calling it an “immense bid” for gold “all in the open”.
This is before gold and silver decided they wanted to start this week off by going on an absolute tear, the follow through to which we will if it has any legs today.
Here’s the one week chart for gold and silver spot:
I just wrote days ago about how I was trying to time the bottom in gold and silver.
And back in August I noted that gold and silver were conspicuously disappearing from vaults worldwide, even marking the lowest LBMA silver inventories since December 2016.
All the while over the last 6 months, we have been having the discussion about whether or not Russia and China plan on challenging the U.S. dollar as global reserve currency - and, if so, what that means for precious metals. I have consistently not only pointed out Russia and China’s efforts over the last decade to de-dollarize, but also their hoarding of gold at historically high rates. I’ve even asked (as have many other metals experts) whether China is holding more gold than they are officially disclosing.
These moves have left some to ask whether or not a “vault run” could be on its way for the metals market:
If someone were to describe the early stages of a collapse in Comex confidence, it would look exactly like this. A few years of elevated deliveries back and forth sloshing around. Metal starts leaving the vault slowly but steadily. Inventories get thin, and the banks restock but not enough. Then a little more fear sets in and the exodus accelerates.
And while delivery and load out levels aren’t at a place where people should panic just yet, they are certainly taking place with a consistent continuity and at a steady rate where a very close eye should be kept on them - especially if the geopolitical climate continues to get “colder” between the West and the BRIC nations.
I also talked about why I thought gold was going to breakout in this interview I did with Palisades Gold Radio a couple months ago, if you missed it.
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Having been long both Au and Ag for a while, I certainly hope you are correct. But I've learned not to spend this money too early!
For me, also going with the miners and junior miners.
With the $ so strong now this is a very good sign. Price gold in other currencies and you see its tracking trouble very well.
Hi QTR, in the graph of comex weekly gold deliveries, what is the difference between the pink and black line?
I got calls on GLD close to the bottom and your last article gave me more data to add to the position then saw some huge options flow, been happy since 😊 it’s up almost 200% heh
other metals rise during the war
be sanction Careful