Comex Open Saw 24 Tonnes of Paper Gold Dumped at Market

"I am open to other possibilities, but it certainly looks like the Dr. Evil strategy being employed for the Comex post-option expiration in which a large number of call options are turned into active December futures contracts. I suggested that this might happen yesterday given the way in which the option market closed.

But I am sure Bart Chilton and the stalwarts at the CFTC have already identified the seller, and examined their selling motivations and the size and placement of their 'fat finger,' and will let us know about it four or five years from now.

"Gold saw a massive 24 tonne sell order (7,800 contracts) at 08:20 a.m. New York time - bang on the opening of the world's largest gold exchange - which a fall of 2.25% in the market price.

If the selling was year-end profit-taking then it was inept. Dealers try and finesse big sell orders into the market to get the best (highest) price for the biggest volume they can and thereby optimize profit - that requires stealth. If on the other hand it was a "fat finger" episode as has been suggested with a broker said to be looking to roll his December gold futures contract then it was even more inept.

More likely this could be a short play, with the seller looking to trigger stops below the market at $1730 and thus extend the move significantly lower and thus increase his profits. If so, he certainly caught the market on the hop as the move is counter-intuitive with everything else that is going on in the economy..."

 

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