In an interesting audio interview with Andrew Maguire, a well-known whistleblower, he describes what is happening in the gold market. For many years, many institutions have manipulated the gold market through paper COMEX contracts, and it continues to this day. Andrew is an insider and understands these dynamics as well as anyone. What is intriguing about this interview is that he normally does not place time frames on price movements. In this interview, however, he places an event occurring 26 days from around June 9th or 10th that will trigger a price appreciation in gold.
Typical shorting after the FED raises interest rates is an indication of a significant price appreciation. After the past few rate increases, a new stair step higher has occurred and a new floor has been established. Back in February, Andrew warned of a price reset within 3 to 6 months. Over the last few months, the gold price has moved higher even as the commercials, bullion banks, and COMEX continue to leverage the paper market at 500 contracts to one physical ounce. As the price tested $1,300, the outrageous new open interest in the August futures contract exploded. A $1,300 level close would have set off a tsunami of short covering and set the price quite high. On Tuesday, June 6th, 26,323 new contracts were added, which is equivalent to 82 tonnes.
Even as open interest continues to rise, the dips are becoming shallower and shallower as physical demand is forcing the central bank’s hand. An additional point that is now being taken into account is that competing sovereigns and central banks are game in the market when the typical wash and rinse cycle takes place. As the Bank for International Settlements and FED continue to try and cap the price, the sovereigns have figured out where the buy windows are. When the FED and the BIS flush out this synthetic, naked, long, hot money, the sovereigns step up to buy at discounted prices within the buy window. Since the leverage has become so great, the competing institutions that purchase in the buy windows in physical gold are depleting the liquidity out of the paper market. As the paper market becomes more and more illiquid, the price will move up, especially since many are not watching the metals as closely as cryptocurrencies on such a tear. Bullion banks and central banks are not in a position where they have enough gold to dump on the market to cap the price anymore. As soon as they are not able to deliver, the price will move much higher. I and many others will be awaiting July 5th and 6th to see what will happen. Normally when the Asian nations have banking holidays, London and the COMEX will hammer the price. July 4th is our holiday, and banks will be closed. Will the Asian nations make a major move during that time? Will the Hong Kong gold futures contract help push physical settlement? Only time will tell, but hopefully the criminal bankers will be dealt the hand they deserve.
Cheers,
Colin