Shanghai Exchange Has 73 Tonnes Of Gold Withdrawn In 4th Largest Week In History
There were a little over 73 tonnes of physical gold withdrawn from the Shanghai Gold Exchange in the week ending August 21st.
This is the 4th largest withdrawal of bullion in its history.
It is hard to tell what exactly is going on in such a dodgy, highly leveraged market, with its determined attempts to keep the price knocked lower so often during the late London to NY trading hours.
But I am sensing a change in the market, and more things running under the surface than meets the eye.
Goldman is no major player in the gold bullion market, but it did strike me as odd that they are suddenly stopping large amounts of bullion for their own house account this month. It is not that they are a player in gold, because they are not. But that they are wired into many sources of information, are good at spotting trends, and are more like a hedge fund, comfortable running on the edge of the markets.
And the gold chart, for what it is worth in these times of market interventions, seems to be trying to form a rounded bottom in the form of a cup and handle, with a successful retest of the handle this week. This calls out a price around the bottom of the old trend channel at 1270.
It could also be nothing. I will pursue the details of such a chart formation if we see the right kinds of follow through next week.
And I will certainly be watching silver very carefully for any signs of life. It may be pivotal next month.
Let's see what next week brings. Gold is just one market among many, and it is certainly not the largest one in play.
And while I have your attention, I thought I would include a long term chart of the relation of deliverable gold at current prices to open interest. It might mean nothing. But it doesn't seem to be anything familiar before 2013.
The charts below courtesy of data wrangler Nick Laird at goldchartsrus.com.
None.
4 things investors should know about China:-
1) With every King, there always a change of guards:- China political arena today, has very little to do with communist ideology. It's is a career join by hundreds of thousand of some of the best brain in China every year. Without going into much details, as they try to climb, they will take side and form alliance, the stake is extremely high, whereby losers may lose their life. Hence the elected "King", truly the strongest in the country.
The changing of guards have nothing to do with corruption, merely with the new "King", come with a group of his own "guards". People he can depend on, to execute his instruction, protect his interests and his life. This typically come after 1st year, during this period, almost all activities will tend to slow down, inclusive business or economical activities. Presently China is in this phrase.
2) Stock Exchange:- About 80% of the market is retail, these investors are mostly gamblers. They are not interested to buy to hold for years, for appreciation and income. In western term, most are day traders, interested in instant gain. If anyone seriously interested to know more, just step into a broker's shop,the atmosphere is more like casino. Furthermore, those active in the market or trade once, not even 5% of China population. The stock market is not a true represent the economical condition of the country.
3) Corporate China:- China has learnt a lot from Singapore, whereby the country is run like a company. The only different, China is much much bigger. Therefore unlike most countries, they can truly implement long term plan and take advantage of world market situation.
Most western analysts, believe 2015, has been a bad year for China, I can tell you it is the best year for China. China has became one of key players in the world market. They had been paying high commodities and fuel pricing for decade, with little room for negotiation. For last 2 decades, Russia had been ignoring China, supplying Europe and Japan, basically isolating China. Most countries are unwilling to sell oil source and commodities mines to China. Present market environment, perfect for China, Russia begging on China door steps, plenty of other countries willing to share/sell their oil farms for China capital. At the present market, China is the only buyer, top management of PetroChina and SINOPAC had recently stated clearly their intend, this intend is fully supported and funded by China Inc.
OPEC, more accurately Saudi, has gone on a price war with Shale, without taking China into their equation, landscape of oil will be seriously change from 2016 onward. China will not only buy from other countries oil fields, but also have the biggest reserve of Shale oil in the world.
Likewise US and Europe had driven Russia to be dependent on China. Russia begging to supply oil to China, while China is getting a foot into Russia oil business. In addition, Russia has no option but align their military might with China.
China slowdown is planned, taking a step back so that they can control the upstream at a huge discount, so that they can soar higher and longer on their next flight.
4) The shrewdest people in the world :- Recently, I was amused when a presenter of Fox News belittle chinese as uneducated and China government has not idea what they are doing. FYI, China has the most graduates then any countries in he world, from universities in China and top universities from other countries in the world. Furthermore, those guys siting as leaders are survivors and winners in a extremely tough power game, whereby loser may lose their life. Strategic Study has been in placed and continuously enhanced in China for thousand of years. Their ability to plot and plan are second to none. Therefore take China lightly at your own peril.