This page has been archived and commenting is disabled.
Gold Hits 3-Month Highs Amid "Frenetic Liquidity"
Gold topped $1230 this morning - breaking to 3-month highs and up over 4% year-to-date - up 5 days in a row for the best run in 4 months. The surge comes causally or correlatedly coincidental with China's explicit shift into extraordinary measures (LTROs) but, as The FT reports, market participants are concerned that algo-based funds have created a "frenetic liquidity" environment as everyone from real money to central banks "aren’t trading the gold market the way they used to."
With most gold trading screen-based and a decline in bank-to-bank activity — the anchor of the over-the-counter (OTC) bullion market — as many institutions have scaled back or exited commodities, The FT reports, this has made the gold market more frenetic and pushed up the costs of hedging and doing larger trades, according to market participants...
“If you’re just transacting in small sizes then probably you have benefited from the changes as you can transact directly through a bank’s electronic platform,” says one veteran trader.
“The issue is if you want to transact in a decent size, which used to be 100,000 to 200,000 ounces. That has become harder to get away with without influencing the price unduly.”
The decline in interbank trading has prompted a debate about the most appropriate structure for the bullion market, with some people suggesting physical gold should be traded on an exchange.
While algorithm-based hedge funds are more active that has created a “frenetic liquidity”, market participants say, causing choppiness in the market. That exacerbates any price moves on lower volumes but also means liquidity can disappear just when it is most needed, for example in the event of a market rout.
“The algos use similar sorts of momentum-driven models — it can all be liquidity in the same way, particularly around economic data releases or when gold prices are at well-identified technical levels,” one gold market participant says.
Coming under greater scrutiny now that 'rigging the game' is more closely monitored, banks have scaled back their operations in the gold market, in the face of greater regulatory costs. Last year Deutsche Bank said it would exit precious metals trading after it withdrew from participating in the gold fix.
“A lot of the trading centres around the fixing and the futures market. London has already seen that massive decline in trading liquidity and volumes,” Ross Norman, head of broker Sharps Pixley, says, referring to the twice daily gold auction used to set a price. “The fix has more prominence than ever given the spot rate has less of a role.”
And more existential problems exist...
London faces competition from China’s Shanghai Gold Exchange after it launched an international trading board in the city’s free trade zone, which allows for freer flow of capital than in the rest of the country.
In September, HSBC, one of the world’s largest bullion banks, said it was approved to be a member of the board.
That could fracture the global gold market, given that China is the largest producer and consumer of gold.
“We will undoubtedly have a Chinese fixing price before the end of the year and we will see a rapid development of a Chinese gold options market — they’ve got a very deep liquid lending market and so the idea that liquidity is moving east is correct,” one market participant says. “They do need to take stock of where the London market is going and what role it’s got to play going forward.”
»
- 23784 reads
- Printer-friendly version
- Send to friend
- advertisements -
NOOOOO!!!! Hammer it DOWWWNNN!!!!!
You're all just a bunch of freakin Barbarians!
Chuck Munger is not amused.
Hey, lets go over to your house, and sometimes we can go over to my house.
The truth is coming....Once it is out before end of this year...gold should move much higher.....Nothing beats reality like reality itself...Supression of gold prices will be history hopefully.
China could crash US dollar with 30,000 tons of gold: commentaryBarbarous Relic
US paper
JHFC would you a;; stop with the "gold hits a high" crap already?
You know that on a Monday(tm) "they" are going to buy stawks at the open, no matter what, but especially on weakness, and sell fucking (paper) gold en masse.
They have full control of the horizontal and vertical dials.
The US is the center of the rot, the core of the nuclear reactor of shit.
dubia......ever notice how every country in the worlds gold supply goes up mostly, with a few like lybia, ukraine, venezuala, losing not selling....but the good ole u s fucking a"s quantities never change...as a matter of point we have the same amount of mexicans (11mil) for how many years now, along with 8k ~ tons of gold for how many years now..almost makes ya think they may be making some of this shit up....
Gold Price Channel At Critical Melt-Up Point
It has always been war of quality with quantity.
In US, quantity of gold may be the same, but think, US population has been rising. 260m in 1994. 290m in 2004. 310m in 2014.
Now the quality people are leaving US. Jim Rogers, Madonna in UK domicile, Tina Turner in Switzerland. Steven Seagal in Russia. Hedge Fund managers in UK and Switzerland. Marc Faber in Thailand. Thousands of more, who may not be resident in the US are giving up their passports in last few years, numbering about 5k per annum. Even 1 Facebook Founder left. All these are job creating top performers i.e. quality.
In addition, Gold should be valued on a relative basis.
Higher debt in US and globally must amount to higher value of gold. In some ways, we have seen gold rise from USD 400 in 2004 to USD 1,200 today. But this is not enough because of demand from the voracious animal called China. Deals have happened with Iran in gold as well due to US sanctions.
These are demand influencing factors which were not present a decade or two ago.
US should not have 8k tons although they claim that they do.
There has never been an independet audit and the public is not allowed to verify. Everything is a consipracy in the US which is truly sad.
We the people, for the people, by the people, is a relic of the past. Govt is managed by mysterious people. From wars to billionaire bailouts....they enrich very few and thousands lose their lives. US cannot even conquer territory as the past empires used to do...at least they had big tracts of land and jewels to show for their conquests.
What does US get in return, aside from enriching a few billionaires?..... Beheadings?...burning of McDonalds...? Hatred ..? Travel bans for US citizens into Iran, Yemen, Libya, Ukraine, Venezuela...?
Dup...
Did you read the article?
If so, could you enlighten me where there was an even a hint of "price suppression".
If anything, the article is stating there are no real buyers and it is all algo driven with no real liquidty.
Suppression is done by the west, not by China or India. Only LME and CBOE publish the price of gold in USD sitting in a dark room. It has been confirmed over the last few years that all Western banks are openly manipulating Libor, gold, FX...EVERYTHING.
My comment did not reflect the article but the overall premise that gold price has been supressed by the West while China and many other nations are not panicking but buying more.
If you visit the temples or villages of India or the vaults or villages of China, you will find enough gold. Despite producing the highest amount of gold in the world, China does not export one ounce, yet keeps buying from the world.
The thing with gold is that, despite the price movements, no one is selling.
So, why has the price of gold jumped from USD 400 in 2004 to USD 1,200 in 2014? This denotes the rise. But in my view, it should be much higher because all Govts except China are bankrupt. Gold must reflect the real value versus fake paper printed money.
Why they have brought gold from USD 1,900 to USD 1,200 is beyond me!?
We are entering the year of the "Fire Monkey" on the Chinese calendar. All things are possible.
Didn't read the linked article, but it would be rather stupid to do so by the Chinese: "Never Interfere With an Enemy While He’s in the Process of Destroying Himself!"
This time, they are monkeying the hammer.
The monkey hammer is in the shop being repaired. Not to worry, they'll fix it soon...
Maybe the monkies went on strike, the damn dirty apes!
Fix it soon indeed. It will come back with an extra 5 lbs added to it, however similiar to most men over 50 years old, it's nice to see it pop up every so often.
"frenetic liquidity" environment as everyone from real money to central banks "aren’t trading the gold market the way they used to."
What is the definition of 'real' money one has to ask?
Pay attention to language and 'real' meaning of words.
https://en.wikipedia.org/wiki/Frenetic_%28programming_language%29
Frenetic is a domain-specific language for programming software-defined networks (SDNs). A domain-specific programming language allows network operators, rather than manually configuring each connected network device, to program the network as a whole. Frenetic introduces a set of purely functional abstractions that enable modular program development, defines high-level, programmer-centric packet-processing operators, and eliminates many of the difficulties of the two-tier programming model by introducing a see-every-packet programming paradigm. Hence Frenetic is a functional reactive programming language operating at a packet level of abstraction.
What are algos and interconnected markets (aka computer networks).
The key is the Bloomberg terminals...
How are they going to hammer gold back down under $1200 unless they first pump it up around $1300? C'mon people, we should all be used to this by now.
Someday this war on gold is gonna end...
"That could fracture the global gold market, given that China is the largest producer and consumer of gold."
oh, I have a love/hate relationship to the English-Financial language, full of breaks, and crashes, and other cataclysmic words like... fracture
gold has usually no problem to take a flight and... leave. already half of the flows are from the US to Europe and from there to Asia
a fractured market would be one where you'd have a different price in NY as in Shanghai. possible, but more then a different price in the whole Old World
so either that "fractured gold market" is a complete hyperbole, or we are talking here about a gold embargo
Embargo is exactly what they are really implying.
That horse has already bolted, a day late and a Sovereign short.
Now that the market isn't rigged all the players have left lol
the fed gangsters broke the gold market too. :this is my (fake) shocked expression: there is no market, there is only the fed.
Yellen will Hammer Gold on Friday, Just in time for Memorial Day Weekend.......USA USA USA !!!!!!!!!!!!
Yeah but then the Fed will pump it back up again by july 4th.
Yawn.
My metal is safe by my friends Smith, Wesson, and Colt, and 5 Rottweiler Pitbulls. No amount of bankster manipulation can change the outcome.
Geez,
A local SWAT could take care of that and they have the choice of painting you as a terrorist so they can imprison you for life or they can just kill you and tell whatever lie they like.
But that is so 2000s and outdated. Better just to drone your ass.
Time for a rotation back into Au and miners?
By the way, have you all noticed that gold and silver spot prices have risen steadily upwards right after the news that China (Shanghai Gold Exchange) announced they had completed their testing and could go online with a competitive spot price vs. London and Comex as soon as the end of the month?
No idea if there is any real correlation to this, but the action/reaction of gold and silver prices is certainly an interesting coincidence.
Dovie'andi se tovya sagain (It's time to toss the dice)
Got Karatbars?
Where are the bullion banks getting all the Gold to keep this price manipulation going?? So annoying.
They aren't. They were getting the gold from central banks, but the CBs are calling it home.This is ponzi paper gold, nothing else.
The game now is keeping the price low so the BBs can buy it (the real stuff) to give back to the CBs without imploding. China likes low prices as well. Pretty much everyone is on the "low prices are good" side of the trade; eventually this will break down and you'll see the moonshot.
w w w . usdebtclock . org
PM bitchezzz
No rush, plenty of time.
Annnnnnd its gone, Monkey Hammer time.
Have the LBMA or CONeX defaulted? No, so they are still in paper control of this "market", up and down.
Still got a lot of work to do before it can shrug off its tenacious bear market.
If you believe in the Gold story going forward keep it simple, just stack every month (with money you won't really need).
If you don't believe, then fuck off :)
the only thing that bothers me with gold is:
1. it is the ultimate enemy of the CBs
2. they can confiscate it, as did FDR.
and I dont doubt they will again when TSHTF.
Hammertime is back.
http://bonnerandpartners.com/weekend-edition-why-most-gold-bugs-are-dead...
We the people stand alone.
So many have the perception backwards.
Let's assume the hammer is gone and nothing is there to prevent gold from going to the moon.
This is all you can muster? This is all you got? A little move that like this fighting to break $1300? Give me a break.
And then when prices decline again, you want blame the hammer for coming back. You keep telling about all the gold demand. ZH keeps posting all the stories about China, Russia, and various other nations that are buying up physical gold like mad, by the tonnes.
Something isn't adding up and it's those that are bullish on PMs. You just don't want to admit it.
So, okay, I do like PMs., I'll be buying YOURS at lower prices because you were forced to sell.
Few will sell in my opinion, why woul they?
You're assuming the majority buy Gold to make money hence if/when they lose money they panic and sell.
Some of the Gold I own was left to me by my Grandfather, he probably saw its value increase/decrease many times over the years he held it. No doubt Grandpa was chucking in his grave when ZERO estate tax was paid in the Gold he left to his relatives. He bought Gold so that moneywould a) dissapear from the system, and b) act as pure security/insurance.
I do the same, money making isn't everything.
Sum dick can't see past the end of the quarter.
Grandpa could though.
You sound like a guy I know, his name is Dick
for what its worth, my Omnitrader tech analysis program went long GLD Friday.
So dumb, you don't even have the vaguest understanding of precious metals.
Does anyone remember a fair market?
If you do, you are lying, there probably wasn't one ever.
Odd, no mention of Tom Coughlin's Bullion Capital and the related new international exchange Allocated Bullion Exchange (ABX).
https://www.bullioncapital.com
http://www.abxglobal.com
Why only London vs Shanghai?
adverb of the day: "correlatedly"
non event
in euros gold is stable between 900 and 1100 for the last two years
"We have always been at war with Real Money."
This is what Russian Pravda is saying about Chinese gold.
http://english.pravda.ru/business/finance/15-05-2015/130611-china_gold_d...
The tribe still worshipping the golden calf .
moooooooooooo....
If Russia owned all the world's physical Ag and China all the world's physical Au --- what then ?
There are still a few months left of the bear market rally in Gold which should rise into the $1350-1400 range...
http://www.globaldeflationnews.com/gold-elliott-wave-update-for-week-end...
yawn
The USSA and London are likely to find a way to confiscate . tax or make gold and silver difficult to make gains with . one would have to be willing to break the law .. send the gold abroad for cash or to some foreign friend who can deposit it for you if you want to buy 'stuff' ./. . if you have anyone like that to trust .. I can not see the powers that be allowing poeple . the sheep and ordinary Joes to benefit from their long suffering holding onto gold and silver . a gut feeling tells me they will make it near impossible to trade for new dollars or anything else. they will tax the transactions .. unless you can find someone to barter for gold or silver in exchange for 'stuff' . . the people of the USSA and the West maybe screwed. So between now and end of this year . how much gold and silver to trade in order to buy hard assets . commodities.. STUFF one may need in the future . from food or semi luxury goods.. coffee, liquor . antibiotics.. chocolate .. STUFF a set of tires.. shoes for you kids through age 18 .. STUFF .. .. and silver and gold . .hang onto some . the rest buy STUFF you may need somewher down the road.. I hope confiscation or taxing it won't happen but NOT holding my breath and yes . I will break the law if push comes to shove. so will millions of others.
A picture is worth a thousand words -- here is a link if it doesn't show in this comment: https://s3.amazonaws.com/khudes/dollar.png
https://s3.amazonaws.com/khudes/Twitter5.18.15.pdf
The coalition for the rule of law [the BRICS (Brazil, Russia, India, China & South Africa), the G-77 (133 developing countries), Germany, the US minus the Federal Reserve] is changing everything by using the legal system to end the network of global corporate control (which has the private central banks at its hub). http://kahudes.net/wp-content/uploads/2012/05/exhibit3.pdf
The likelihood that the coalition for the rule of law wins is 90-95% https://s3.amazonaws.com/khudes/sentia+model.pdf