The Comex report last month showed great strength in gold, which directly preceded a massive rise in the price of gold. The data is similar in silver this month!
The CME Comex is the exchange where futures contracts are traded against gold, silver and other commodities. The CME also allows buyers of futures contracts to turn their contracts into physical metal via delivery. You can find more details on the CME here (e.g. safe types, major/minor months, delivery explanation, historical data, etc.).
The data below examines the execution of contracts in which ownership of physical metal changes hands in CME vaults. It also shows data that details the movement of metal into and out of CME vaults. It is very possible that if there is a run on the dollar and a flight to gold, this is the data that will show the warning signs.
Gold
April is an important gold delivery month. This month's delivery amount of 18,000 contracts was the second highest since June last year.
Figure: 1 Recent delivery volume for a similar month
Net new contracts saw a late increase of almost 2,000 contracts towards the end of the cycle. This is quite unusual, as shown below, where peaks typically occur much earlier in the delivery cycle. Net new contracts represent contracts opened for immediate delivery on contracts already in the delivery phase.
Figure: 2 Cumulative net new contracts
Inventory levels remained very stable for most of April.
Figure: 3 Inventory data
Heading into the May contract, gold open interest is at an average level ahead of the delivery phase.
Figure: 4 Open interest countdown
As a percentage of gold available for delivery, gold open interest is slightly above the pack but still around average.
Figure: 5 Open Interest Countdown Percentage
Money
April delivery is a minor delivery month for the money. Delivery volume has increased in recent months, but saw a significant increase last month. In fact, the number of 1,649 contracts delivered is the highest since June 2022, the height of the Covid crisis.
Figure: 6 Recent delivery volume for a similar month
This was entirely due to a net increase in new contracts, suggesting that people did not want to wait for the May delivery window (an important month) and instead wanted immediate delivery. Delivery of new contracts (1,159) was 50% higher than the closest month in the last two years (February 2023).
Figure: 7 Cumulative net new contracts
Registered and eligible were plotted separately to make the graphs more readable. Eligibility has seen an increase over the past month.
Figure: 8 Inventory data
Eligibility has seen a sudden decline, but remains well above August 2023 lows.
Figure: 9 Inventory data
As we approach the May delivery period, you will see that the silver contract is trading well above all other months. This has been consistent throughout this month, but has really surpassed the others with one day remaining. We will likely see a large drawdown on the last day, but these contract holders are waiting until the very last minute to renew their contract.
Figure: 10 Open interest countdown
On a relative basis (compared to recorded metal), this month is a little more middle of the pack. As the charts above show, this is primarily due to an increase in registered metal. We are still at 125% registered with one day remaining.
Figure: 11 Open Interest Countdown Percentage
Conclusion
Last month, the gold seemed very strong. In the days following the last report, gold began to move higher and only stopped when the price reached a good corrective pullback. Silver saw a similar rise as it followed gold's rise, but Comex data suggests there is plenty of interest in the commodity. physical money right now. This could soon lead to a sharp rise in prices. Let's see how the data evolves in the short term.
The data source: https://www.cmegroup.com/
Data updated: every evening around 11 p.m. (Eastern Time)
Last updated: April 26, 2024
Interactive charts and graphs on gold and silver are available on the Explore finance dashboard: https://exploringfinance.shinyapps.io/goldsilver/
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