-- Posted Monday, 3 June 2013 | | Disqus

STATS

London Gold AM Fix $1,396.75, -$13.50 LME Copper Stocks 617,225 tons +8,775 tons

Gold Stocks 8.055 million ounces -297, Silver Stocks 165.749 million ounces +459,017

Chinese equity markets were lower overnight off slack data released over the weekend. The Nikkei was markedly lower overnight as some renewed doubt surfaced on the Japanese plan to shed deflation under the new Japanese monetary base expansion plan. European equities were softer to start off weakness among insurers and also because of soft Euro zone Factory order results. US stocks were able to show some minimal gains early on today but the action wasn't really definitive. The US economic report slate today contains an ISM Manufacturing Index and US Construction Spending readings. Expectations for Construction Spending call for a gain of slightly less than 1%, with a similar minimal rise expected in the ISM results.

GOLD

While gold is showing some positive initial action, the market could have been undermined by ongoing talk of further Indian government moves to restrict or hinder gold imports. Last week, the gold market saw official comments that the Indian government would wait until they had a full month's gold import data before making a decision on increasing the gold import tax rate or implementing additional gold loan restrictions. With the end of May and widespread talk of soaring Indian gold import activity, the trade is now bracing for potentially bearish gold import/loan rules from Indian officials. In fact, the Indian Finance Minister recently suggested that India could not "afford" high levels of gold imports and that has a number of players anticipating an announcement directly ahead. However, gold was helped higher overnight by supportive currency action and perhaps because of news of weaker than expected Chinese economic data and it is also possible that gold was lifted by the weakness in Asian equity markets. At the start of the new trading week, the trade will be looking to establish its focus and with the dollar sitting near a 15 day downside breakout, that focus could become currency related. It is possible that somewhat dovish comments from the Minneapolis Fed, regarding the need to get the US jobless rate down despite the low inflation environment, provided gold with some support to gold in the early trade today. The Commitments of Traders Futures and Options report as of May 28th for Gold showed Non-Commercial traders were net long 55,203 contracts, a decrease of 6,730 contracts. The Commercial traders were net short 57,964 contracts, a decrease of 9,857 contracts. The Non-reportable traders were net long 2,760 contracts, a decrease of 3,129 contracts. Non-Commercial and Non-reportable combined traders held a net long position of 57,963 contracts. This represents a decrease of 9,859 contracts in the net long position held by these traders.

SILVER

While July silver was showing some positive action to start, prices were sitting in the lower portion of last Friday's trade early on. Favorable currency market action and gains in other metals markets were lending some support early on, but some traders are fearful of a recent pattern of lower highs. The Commitments of Traders Futures and Options report as of May 28th for Silver showed Non-Commercial traders were net long 2,949 contracts, a decrease of 3,845 contracts. The Commercial traders were net short 6,991 contracts, a decrease of 3,413 contracts. The Non-reportable traders were net long 4,043 contracts, an increase of 432 contracts. Non-Commercial and Non-reportable combined traders held a net long position of 6,992 contracts. The Non-commercial and Non-reportable net spec long positioning has now fallen down to the lowest levels since 1997, with the latest weekly decrease of 3,413 contracts in the net long position. In short, certain spec long categories in silver are now getting close to the lowest net spec long positioning in modern trade history. Comex Silver Stocks were 165.749 million ounces up 459,017 ounces. Silver stocks have declined 12 of the last 20 days.

PLATINUM

Like silver, platinum has started out on positive track but within relatively close-proximity to last Friday's low. Platinum is probably garnering some support from lingering supply side fears into South African mining wage talks especially after press reports of the death of a miners union member at a South African mine overnight. However, the South African government is expected to be heavily involved in the early negotiations and that could serve to keep tensions down at the beginning of the talks. The Commitments of Traders Futures and Options report as of May 28th for Platinum showed Non-Commercial traders were net long 23,896 contracts, a decrease of 3,984 contracts. The Commercial traders were net short 24,541 contracts, a decrease of 3,961 contracts. The Non-reportable traders were net long 646 contracts, an increase of 24 contracts. Non-Commercial and Non-reportable combined traders held a net long position of 24,542 contracts. This represents a decrease of 3,960 contracts in the net long position held by these traders. Critical support in July platinum is seen at $1,456.60 and then again down at $1,453.50. In order to shift the technical picture back in favor of the bull camp might require a rally back above $1,471.00.

COPPER

Asian copper prices were a little higher in the wake of Chinese PMI data, as the trade was fearful of patently negative readings and it is also possible that Asian copper prices were simply playing catch up to some positive US economic data that was released last week. US Copper might also be garnering some lift from a softer US dollar and from initial gains in US equities. In retrospect, copper will probably retain some support from positive US home price data from last week, but a rather surprisingly large single day rise in LME copper stocks last night, might send a wave of caution to some copper bulls in the US Monday trade. Therefore the copper trade might take a lot of direction from US Construction Spending and ISM readings which are scheduled for release later this morning. The Commitments of Traders Futures and Options report as of May 28th for Copper showed Non-Commercial traders were net short 13,172 contracts, an increase of 180 contracts. The Commercial traders were net long 20,414 contracts, a decrease of 1,419 contracts. The Non-reportable traders were net short 7,242 contracts, a decrease of 1,598 contracts. Non-Commercial and Non-reportable combined traders held a net short position of 20,414 contracts. This represents a decrease of 1,418 contracts in the net short position held by these traders.

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-- Posted Monday, 3 June 2013 | Digg This Article | Source: GoldSeek.com

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