from Dan Norcini:
Once again we have another one of those proverbial flies in the ointment when it comes to one of these frequent rallies we have seen in gold during the ongoing bear market of the last two+ years. We get a great rally and a lot of powerful chart action over at the Comex only to wait upon the reported holdings update from GLD and then find disappointment.
Instead of a nice climb in the holdings, what did we get instead? _ a fall of some 5.7 tons! Quite honestly, that came as a very big surprise to me. Given the action in the mining shares, I had expected to see some increase in the holdings. ‘Twas not to be apparently.
This confirms my concerns about the rally – namely that while it was indeed powerful, it was due primarily to short covering and not so much due to an abundance of new buying. It is obvious that some used the rally in gold to close out some longs in the GLD.
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