Is This The Real Driver Of Gold's Recent Weakness?

If you are a precious metals investor then you may be wondering why the price of gold and silver has been slammed in recent weeks... amid ever-increasing nuclear armageddon rhetoric, storms, quakes, floods, and a central bank (that is notoriously bad at forecasting) about to attempt to do something with its balance sheet thathas never been achieved...

The answer is surprisingly simple... China's Golden Week Holiday.

As's Mac Slavo wrote a year ago, and appears to be proved correct once again... Ask the expert pundits on financial media and you’ll get a swath of explanations for how the strength of the dollar or the improving health of the global economy are to blame.

One could reasonably argue that dollar strength this week could certainly put downward pressure on the gold price. So, too, could one make the point that mainstream perspective is such that the economy is improving, which means investors aren’t in panic mode and have no reason to hold a safe haven asset. But neither of these arguments could realistically lead to the smack down we witnessed this week.

So what happened?

Well known gold and silver analyst Andy Hoffman suggests the answer could be much simpler than we have been led to believe.

There’s no reason… there’s not even a propaganda meme of why [gold has been smashed]… there isn’t even a such thing as negative news for precious metals anymore…


The fact is, [like the last few years, when prices collapsed], China is closed for the week.

One glance at the last few years gold price action suggests he may well be correct...

After this Friday's close, China will be on vacation for its Golden Week National Holiday and this weakness appears to be traders front-running the traditional chaos that the rest of the world plays when China leaves the playing field.

China will be back in business on October 9th, and that means the Shanghai Gold Exchange, which opened in 2015 to counter Western manipulation of precious metals, will likely help re-balance prices to where they were before this recent takedown.

We could be wrong, but something tells us gold and silver prices won’t stay this low for much longer and that they could well see a complete turnaround when China reopens on October 9th.


djealas TerminalDebt Thu, 09/28/2017 - 15:01 Permalink

Look, TD, for me its never been about gold going to $50k/oz. If that happened the world would be an unholy shit storm, financially, socially, etc. Gold should be higher based on real inflation, not those bullshit numbers the guvmint provides. But the paper gold market is much larger than physical, and you can only short paper gold, not physical.Another problem is gold miners getting clobbered by low prices, so more people out of work, etc. Yeah, its a small market, but it still puts people to work. Gold is always going to be worth something, long after paper crashes. the historical record just backs that up. Fiat crashes all the time. There's no tin foil in my hat, but even a blind bat has to see the metals market should be doing better, in light of all thats going on globally.

In reply to by TerminalDebt

ejmoosa BaBaBouy Thu, 09/28/2017 - 08:19 Permalink

Not only the shorting of Paper Gold, but the Paper Gold itself is negative.What did the Fake Beanie Babies do to the prices of real Beanie Babies when they were both being sold on Ebay?It falsly increases the supply of "gold*".*Some of this gold is imaginary, but we market it anyway.

In reply to by BaBaBouy

fockewulf190 sinbad2 Thu, 09/28/2017 - 12:09 Permalink

Fraud is worldwide. All the banks are linked and packed to the gills with derivatives totaling over a quadrillion. Sovereign debt levels are out of control. Central banks combined are debasing to the tune of hundreds of billions per month just to keep the shitshow from collapsing. Stocks are being bought with some of that money printed out of thin air as well, not to mention bonds, which in turn is the only thing keeping the massively underfunded pension funds from imploding.

Phyzz is dirt cheap. Bought me some more Maples and Philharmonics today. Thanfks for the manipulated prices.

In reply to by sinbad2

LightBulb18 Thu, 09/28/2017 - 04:54 Permalink

It should be easy for taxi companies to dominate uber, just charge A little more than them and you don’t have to worry about the driver being A criminal. There are cabs near most places people take cabs. 

scintillator9 Thu, 09/28/2017 - 05:08 Permalink

Imagine where the price would have been were it not for all of those sudden margin inceases by our good friends at the CME in 2011?…

The CME Group sharply raised silver futures margins for a fourth and fifth time in under two weeks, an 84 percent rise in trading costs that has helped provoke a nearly unprecedented sell-off.The 20 percent slide in silver prices since they touched an all-time high of $49.51 an ounce on April 28 has been in large part driven by selling from speculators who may be unable or unwilling to bear the surging cost of holding positions.…

CME Group, the world's largest commodity exchange, raised margins on gold by more than a quarter, which is the biggest increase in two years and the second decision to lift prices in a month. 

Why Garsh, imagine if the stawk market did something like that........ Guffaw, guffaw.