There were heavy sales from the SPDR gold ETF of 7.451 tonnes but none from the Gold Trust on Friday. The holdings of the SPDR gold ETF are at 672.703 tonnes and 162.92 tonnes in the Gold Trust.
These sales were made at the close on Friday in the manner of earlier ‘bear raids’ and did not hurt the gold price in New York. We continue to see the ‘bear raid’ selling when there are no buyers and forcing arbitrage selling into Shanghai. This morning that 40-tonne-trades-a-day market opened with this large amount in front of them at the opening. But it seems it too has been snapped up as the gold price has been unaffected, at least initially. Can we draw the conclusion that the ‘bear raid’ has been raided and its physical power taken off the market? It would seem so, but let’s see this week.
Now add to this situation one where U.S. banks are forecasting much lower gold prices, the media has rarely been so negative on gold and the mood for gold could not be worse. It is rare that when a market is facing one way so much, that it goes that way! This week and next could prove to be the most interesting of weeks!
Many investors may have feared that the Paulson fund, the single largest investor in the SPDR Gold Trust at the end of the first quarter, may have been selling off his holdings in gold. Paulson & Co has retained a 10 million share stake, now worth about $1 billion, in SPDR Gold Trust. The fund had 10.23 million shares in the SPDR Gold Trust as of March 31, and the position has not changed materially since then. This confirms that the selling has come from those hoping for a huge profit if prices go lower.