Zerohedge reports that last night a sell order for 1,500 contracts worth about $180M was dumped on the gold futures market. Gold price dropped about $10/ounce in response and market halts triggered stopping trading for 20 seconds. Now (as of 10am eastern) gold has rebounded to above $1,240 where it started the day.
It's deja vu all over again. The gold market did the same thing last Wednesday, November 20th. 1,500 contracts sold; halted market for 20 seconds; price rebounded quickly. Then, last Wednesday a second large sell order hit the market in the afternoon which smashed prices $15 to $1,245. Gold prices stayed down after the second beating of that day.
Will we see a second blatant sell order this afternoon as we did on the 20th? The beatings will continue until morale improves.
Today, Monday November 25 gold and silver option on the COMEX expire. Wednesday November 27th is the first notice day for COMEX December gold and silver contracts. That is the first day that holders of December dated futures contracts can provide notice to the COMEX that they are standing for delivery.
COMEX registered gold inventory is 589,414 ounces or 18.3 tonnes. Total December future contracts or open interest as of Friday evening was 104,270 for 10.4M ounces. There are 100 ounces per contract. Only 0.6M ounces are in inventory to cover a potential demand of 10.4M. The demand or open interest is, however falling quickly as is typical just before a notice period especially with falling prices. On Thursday and Friday open interest for December futures fell by 23,784 and 22,313, respectively.