August 15, 2022

GLD and SLV Holdings Decline as Investors Ponder Next Move in Gold and Silver

Both the SPDR Gold Share Trust (GLD) and the iShares Silver Trust (SLV) registered minor declines over the past week.

Holdings in the GLD declined by 2.43 tonnes compared to a decline of 21.85 tonnes in the previous week.  Since the start of the year, total holdings have declined by 4.2% or 53.57 tonnes.  The GLD currently holds 39.5 million ounces of gold.

The holdings of the GLD currently have a market value of $52.7 billion, making the GDL a very significant presence in the gold market.   The market cap of the GLD  far exceeds that of major gold producers such as Goldcorp (GG) at $30 billion, Newmont Mining (NEM) at $27.4 billion and Randgold (GOLD) at $7.1 billion.

Gold has now made three failed attempts to decisively pierce the $1400 level since last November, forming a triple top in the process.  The failure to breakout to new highs and the large price gain of $250 per ounce since last July has motivated some nervous selling by gold investors.  A look at the one year chart shows that gold’s short term momentum has faltered as prices breached the 14 day moving average.  The next important test will be at the 200 day moving average which gold has traded above for the past two years.

1 YEAR GOLD PRICE - COURTESY KITCO.COM

Despite the recent minor setback in gold prices, the long term trend of gold remains intact technically and fundamentally.

GLD and SLV Holdings (metric tonnes)

2-Feb-2011

Weekly Change

YTD Change

GLD

1,227.15

-2.43

-53.57

SLV

10,400.60

-47.10

-520.97

Silver holdings in the iShares Silver Trust (SLV) declined by 47.1 tonnes over the past week compared to a decline in the previous week of 127.6 tonnes.  The year to date decline of 520.97 tonnes represents a 4.7% drop in silver holdings which trails the 7.8% year to date decline in the price of silver.  The SLV has declined by 9% from its high of $30.40 at the beginning of the year.  After a huge gain of 67% in the price of silver since late last year, it is normal to see price consolidation before another advance.

In this writer’s opinion we have not seen a parabolic blow off type price move, nor have we seen the excited entry of first time silver buyers lured by stories of rising prices.  One of the sentiment gauges that I use involve noting how many of my friends and clients ask or offer unsolicited advice on a specific investment category.  Thus far, not even one person has mentioned silver.  Despite the huge advance in silver prices, public awareness seems minimal, implying long term bullishness.

SLV - courtesy yahoo finance

Will Speculative Positions in the GLD and SLV Accelerate a Precious Metals Selloff?

Given the recent pullback in the prices of gold and silver, it was not unexpected to see another decline in the holdings of both the SPDR Gold Shares Trust (GLD) and the iShares Silver Trust (SLV).

Holding in the GLD declined by 21.85 metric tonnes, compared to a decline last week of 20.04 tonnes.  The year to date decline now totals 51.14 metric tonnes, representing 1.8 million ounces of gold worth about $2.4 billion.  GLD holdings had declined by 39.75 metric tonnes in 2010 after reaching record high of 1,320.47 tonnes on June 29.

Fluctuations in the holdings in the SPDR Gold Shares Trust are not always directly correlated to price movements in the metal.  As holdings were declining from all time highs in late June, the price of gold continued to soar another $200 per ounce from the $1200 level in July to $1400 by October.

Some have expressed concerns that declines in the price of gold may be compounded if large positions in the GLD held by speculators are sold. Since late 2008, the GLD has doubled in value as gold prices soared.  With the GLD holding a huge $52.5 billion worth of gold, any large scale liquidation of positions would certainly seem to have the impact of accelerating a price correction in gold.

1 Year Gold - Courtesy kitco.com

GLD and SLV Holdings (metric tonnes)

Jan 26, 2011 Weekly Change YTD Change
GLD 1,229.58 -21.85 -51.14
SLV 10,447.70 -127.62 -473.87

Silver holdings in the iShares Silver Trust declined by 1.2% for the week, representing reduction of 127.62 tonnes.  The year to date decline has now reached 473.87 tonnes, or a 4.3% from the beginning of the year.  Meanwhile, the price of silver has seen a 10% drop from its high of $30.70.

The SLV represents an easy vehicle for hot money to jump into the silver market and purchases by the SLV have contributed to demand for silver.

Increased silver purchases by the SLV helped to propel silver prices higher last year, but this same process can work in reverse.   Large sell orders by speculative holders of the SLV could result in a sharp decline in the price of silver as the SLV liquidates its holdings.

One year silver - Courtesy kitco.com

Gold and Silver ETF Holdings Continue To Decline

As gold and silver continue to trade in a narrow range, investors have reduced their holdings in both the SPDR Gold Shares Trust (GLD) and the iShares Silver Trust (SLV).

Holdings in the GLD declined by 20.04 metric tonnes over the past week, a substantial decrease compared to last week’s reduction of 1.21 tonnes.  The record high holdings of 1,320.47 tonnes in the GLD was reached last year on June 29 when gold bullion was trading in the $1250 range.

GLD and SLV Holdings (metric tonnes)

Jan 19, 2011 Weekly Change YTD Change
GLD 1,251.43 -20.04 -29.29
SLV 10,575.32 -150.41 -346.25

The price of gold has now dipped decisively below its 50 day moving average but is still well above the 200 day moving average.   Last year’s July price correction in gold to slightly above the 200 day moving average was followed by a rally of $260 in the price of gold.  A pullback to the 200 day moving average would result in a price decline of about $100 for gold.

Gold Chart - Courtesy stockcharts.com

The SLV declined by 150.41 tonnes compared to a reduction of 191.46 tonnes in the previous week.  Total silver held by the Silver Trust amounts to 340.004 million ounces.   Silver has had a huge price move since last September when it was trading in the $18 per ounce range.  Precious metals can exhibit volatile price movements, but so far silver continues to consolidate and has surrendered only a small part of its gains from the $31 per ounce level reached at the beginning of the year.

Silver - Courtesy stockcharts.com

Gold and Silver ETF Holdings Mixed Amidst Price Decline

Over the past week, gold holdings in the SPDR Gold Shares Trust (GLD) fell, while silver holdings in the iShares Silver Turst (SLV) rose. These changes occurred amidst a decline in the price of the metals and a buoyant stock market.

The iShares Silver Trust, which represents the largest exchange traded fund backed by silver, increased by 13.85 metric tons from the previous week. Total holdings are now 10,917.19 metric tons, or 350.996 million ounces.

Holdings within the SPDR Gold Trust fell by 11.38 metric tonnes in the past week to 1,272.68. Trust holdings had reached a record high of 1,320.47 on June 29, 2010. The decline in holdings from the high is now 47.79 metric tons, or 3.6%. During the same period the price of gold has risen by more than 10%.

GLD and SLV Holdings (metric tons)

Jan 5, 2011 Weekly Change YTD Change
GLD 1,272.68 -11.38 -8.04
SLV 10,917.19 +13.85 +4.38

Gold and Silver: Investment Similarities

Gold and silver just seem to go together. They’re two precious metals that we love to invest in, especially after the strong performance of the metals during 2011, and gold’s string of consecutive annual gains stretching back a decade.

This year, gold futures have grown as much as 25% this year and silver futures as much as 75%. It’s this last figure that really interests us though. It is indicative of growing investor interest in a metal that is much more affordable than gold, but still offers many of the same benefits in the precious metals market.

Gold and Silver Investment Options

The major similarities that we can point to are related to the various ways that gold and silver are sold and traded among investors. In most cases, a potential investor has a few different options:

  • They can invest in bullion coins
  • They can invest in numismatic coins
  • They can invest in exchange traded funds or ETFs

Gold and silver bullion coins are produced by a number of different world mints. A few of the most widely traded options include the American Silver Eagle from the United States Mint, the Silver Maple Leaf from the Royal Canadian Mint, and the Silver Philharmonic from the Austrian Mint. These coins are issued each year and are generally sold based on the market price of silver plus a mark up. The mark ups might be $2.50 to $4.00 per coin, depending on the quantity purchased.

Numismatic gold and silver coins are those which are valued not only based on their intrinsic value, but also their rarity and condition. In some cases, a rise in the price of precious metals might not result in an increase in value for numismatic coins since other factors come into play. It takes some understanding of the coin market and grading scales to invest in numismatic coins.

For many beginning investors, Exchange Traded Funds provide a useful alternative. Precious metals ETFs are traded on stock exchanges in the same manner as stocks and generally track the price of the underlying metals. There are different types of ETFs, which use either physical metal or futures and contracts to track the price of the underlying metal. The largest and widely held precious metals ETFs are the SPDR Gold Shares ETF (GLD) and the iShares Silver Turst (SLV).

The State of the Gold Market

Until quite recently, the gold market has been experiencing a strong rise in prices. This has been due to factors such as concerns regarding weak currencies and unstable foreign governments. Gold has been viewed as a safe haven investment and has been attracting an increasing share of investment dollars. Despite the recent cool down, many market experts are predicting a continued rise in prices over the long term.

The Most Recent Market Reports

As of November 26, SPDR Gold Trust (GLD) stated that its holdings remained unchanged from the previous trading day at 41,316,740 ounces. The IShares Silver Trust (SLV) stated that its holdings declined by 5,865,684 ounces to 344.374 million ounces. Market experts have suggested that the holding pattern, as well as the slightly lowered prices indicate a decrease in safe haven demand. Recent data on the economic situation in the US has at least temporarily arrested some of the more pressing fears about the economy, and the price of gold has typically risen and fallen inversely to the strength of the dollar.

Other Gold Related News

There are other potential considerations. For example: a major French gold supplier is launching a range of mini bars. There has been a growing interest in precious metal investments in the French market and this new approach is aimed to capture some of this market. In addition, Canadian company Infinito Gold Ltd has lost its gold concession after a Costa Rican court ruled that their mining was harmful to the local environment. Finally, the central bank in Vietnam is actively attempting to cool domestic gold market prices by granting additional quotas for domestic companies importing gold between now and year end.

Gold and Silver Recap: Prices Mixed, Eurozone Troubles

Another Precious Week

The big news is once again that the Euro zone is in trouble.  Ireland has rather bizarrely decided to take a bail out loan that it claimed that it never wanted, but that’s not the really, really big news.

No the really, really big news is that the rest of the Euro zone is in trouble.  Both Portugal and Spain are denying that they need bail outs, which to the international markets seems to mean “are in an early rather than a later stage of negotiation”.  Even Belgium is looking vulnerable.  And outside the Eurozone the British, who seem to have been remarkably smug, are also in trouble due to their mainly nationalized banks being up to their neck in bad Irish debt.  So chaos.

And then there’s Korea, where we could have war.  And so more chaos.

But not inflationary chaos, yet.  This has meant that gold and silver swapped places this week.  Gold went up (reflecting a greater danger that the world was going to end soon) while silver went down showing that inflation was probably not likely when everyone’s trying to work out how to wind up a small but rather expansive economy.

Precious Metals Prices
Fri PM Fix Weekly Change
Gold $1,355.00 +12.50 (+0.93%)
Silver $26.62 -0.45 (-1.66%)
Platinum $1,639.00 -11.00 (-0.67%)
Palladium $670.00 -25.00 (-3.60%)

This has not just shown in silver, palladium and platinum prices – it’s also shown in the price for crude oil.  The dollar’s strengthened and everyone’s worried about money going out of the system rather than going in.  Whether this will last is another question, after all although the Euro is a mad concept with a single currency over separate fiscal policies it had a reasonably strong central bank.  Sooner or later someone’s going to start the printing press up as they’ve already done in Washington, Tokyo and London.  And gold rose 3.8% against the Euro.

When looking at the market there hasn’t really been much government action.  The action, as it has been for much of this half of the year, has been among consumers.  For example the GLD ETF, a way of investing in gold if you really trust brokers rather than gold coins in your hand, has been soaking up a lot of the customer interest in gold.  As these ETFs, or exchange traded funds, are adding to the liquidity they could be setting the stage for a sharp reverse.

There’s also some action in Asia as the Indian wedding season is adding yet more pressure as the wedding season starts and Vietnam allows more gold to be imported. One interesting fact is that Chinese consumers have doubled the amount of savings they devote to gold this year to 2%.  There’s plenty of room for growth.

Source for GLD Gold, SLV Silver Exceeds Capacity, Fort Knox Gold Audit

As gold turns lower on reports of a “turning point” for the entire global economy, let’s take a look at some thought provoking gold, silver, and precious metals related stories from other news sites and blogs. This round up includes stories on the Gold ETF and Silver ETF, a call for a return to the gold standard, Fort Knox, and prospecting for gold.

Where does the Gold ETF get its gold?

As the SPDR Gold Shares ETF marked a series of succesive all time highs for tonnes in the trust, many people started asking questions about where the gold was coming from. Here’s the answer.

SLV exceeds its silver storage capacity

Discussed in the Got Gold Report, the holdings for the iShares Silver Trust SLV have exceed the storage space allowed under its custodian agreement as the holdings reached another new high.

Russia backs return to Gold Standard to solve financial crisis

Following China’s call for a new world currency, Russia suggests that gold should be included in the basket-weighting.

Is there any gold inside Fort Knox?

It’s been decades since an independent audit of the reported $137 billion in gold stockpiled in Fort Knox has been independently audited. Ron Paul is pursuing a Bill to conduct an independent audit of the entire Federal Reserve System. Separately, GATA plans to file Freedom of Information requests for full disclosure of US gold ownership and trading activities.

The Great Credit Contraction

Trace Mayer, J.D. announces the availability of The Great Credit Contraction, which is a foundational document for much of the writing on his site Run to Gold.

New Gold Rush

Believe it or not, people are making money prospecting for gold in California. One prospector claims to have made $10,000 during one good day.

Examining the Gold ETFs, Gold Reaches New Highs

With gold continuing its run, there’s been plenty of gold appearances in the mainstream press. But the more interesting discussions usually happen elsewhere. Here’s a few noteworthy blog posts and articles related to gold.

One thousand tonnes in the trust!

The SPDR Gold Shares ETF continued its rapid inventory growth and surpassed one thousand tonnes this week. An astounding 229 tonnes have been added so far during 2009.

Where do all the gold etfs get their bullion from?

While many mainstream news reports were quick to highlight the one thousand tonne level, others started raising questions. In an atmosphere of gold scarcity, where are the Gold ETFs getting the gold for their massive daily additions?

Ten Reasons to Avoid the Gold ETF

Elaborating on the above, an article that will make you seriously reconsider any investments in Gold ETFs.

Gold Around the Globe: Setting Records

While gold in US Dollars is still laboring below its all time high reached last March, gold in other major currencies has been setting new all time highs.

Gold and Silver Market Manipulation, Paper Market Crash, Platinum Jumps

Beneath Cash4Gold’s shiny veneer, a dull reality

The Cash4Gold Superbowl ad certainly brought the company a lot of mainstream attention. However, it also brought to light many questions about their payment levels and practices.

Gold ETF inventory increasing at record pace

An interesting observation from the author. When the pace of increases spikes, the price of gold usually follows.

Vindication

OK, someone has to say it: Why is the fact that a few banks hold massive concentrated short positions in gold and silver undeniable “proof” of manipulation? Couldn’t it be possible that the banks are simply making a big, dumb bet that will lose them massive amounts of money in the future? It certainly would not be the first time…

Paper gold market will crash at Comex

From the article: “I believe that the comex will default and the entire paper gold market will crash and gold could rise very quickly to 2000 until 3000 US Dollars. When this happens it will be too late to exercise or to try purchasing physical gold.”

Russia Sberbank gold sales jump during crisis

Looking at gold investment demand in Russia. Quote from the article: “We have clients who bought 200-300 kilograms of gold.”

Platinum Jumps to Highest Since October on Investment Demand

The industrial metal jumps on investment demand.