Gold got sold off almost $30 in the first three hours of trading on Thursday morning in the Far East. From that low, just before 9:00 a.m. Hong Kong time, the gold price rallied right up until minutes after 9:00 a.m. in London...and that was its high of the day.

The gold price got sold off from there, coming close to $1,600 spot, but not penetrating that price to the downside...and then spent the rest of the day within ten dollars of $1,615 spot...closing the New York trading session at $1,615.90 spot...up $6.20 on the day. Net volume was in the area of 180,000 contracts.

Silver's price moves were very similar to gold's...with virtually all the price change points coming at precisely the same moments in time. Every attempt by silver to get into a rally mode anywhere on Planet Earth yesterday, ran into a willing seller...or it could have been the smaller commercial traders selling more of their long positions and taking profits.

The high [around $31.40 spot] of the day, like gold, came minutes after 9:00 a.m. in London...and the low [around $29.60 spot] was around 12:30 p.m. in London as well. A late silver fix, perhaps?

From there, silver was up a dollar and then down a dollar for the rest of the day...closing the New York electronic trading session up 74 cents. Net volume was around 46,000 contracts.

For the second day in a row, the gold price got sold off at the open of the equity markets in New York at 9:30 a.m. The stocks gapped up about 2 percent at the open, but ran into selling pressure immediately. For the most part, the shares followed the gold price around almost like a shadow, with the HUI finishing up 0.73% on the day.

The silver stocks, both small and large cap, were a mixed bag yesterday...and only one of the stocks that make up Nick Laird's Silver Sentiment Index did very well for itself...and the index was only up 0.19%. I was expecting somewhat better considering the fact that silver was up 74 cents on the day.

(Click on image to enlarge)

The CME's Daily Delivery Report showed that only one lonely silver contract was posted for delivery today, as the September delivery month goes off the board. Today is First Notice Day for the October delivery month...and it was a busy one.

In gold, a total of 2,781 contracts were posted for delivery on Monday, October 3rd. The big short/issuers were Deutsche Bank and HSBC who delivered 2,760 contracts between them. The big longs/stoppers were JPMorgan in its client account, with 2,898 contracts to be received...and in distant second place was Merrill with 553 contracts.

In silver, there were 450 contracts posted for delivery on Monday. The big short/issuer was the Bank of Nova Scotia with 443 contracts...and the two biggest longs/stoppers were JPMorgan in its client account, along with Jefferies. On Monday they will take delivery of 250...and 122 contracts respectively.

This Issuers and Stoppers Report is worth spending a bit of time on...and the link is here.

There was a substantial withdrawal from GLD, as 321,171 troy ounces were removed...and 730,143 ounces were withdrawn from SLV.

The U.S. Mint had another sales report. They sold another 4,500 ounces of gold eagles...500 one-ounce 24K gold buffaloes...and 275,000 silver eagles. Month-to-date gold eagle sales are 86,500 ounces...along with 12,500 gold buffaloes...and a whopping 4,000,500 silver eagles. There's a good chance we may get another sales report today or Monday to round out the month of September.

There wasn't a lot of activity over at the Comex-approved depositories on Wednesday. They reported taking in 335,236 troy ounces of silver...and shipped a very tiny 18,040 ounces out the door. Most the action, such as it was, was over at Brink's, Inc...and the link is here.

Here's one of many charts that Nick Laird sent me last night. This is the chart of 1-ounce silver eagle premiums over the spot price going back three years.

(Click on image to enlarge)

¤ Critical Reads

CFTC Will Face Scrutiny Over Speculation Curbs at Senate Panel on Oct. 6

The U.S. Commodity Futures Trading Commission, which has yet to complete Dodd-Frank Act limits on excessive speculation, will face scrutiny about the trading curbs at an Oct. 6th hearing led by Senator Carl Levin.

CFTC chairman Gary Gensler will testify at the hearing of the Permanent Subcommittee on Investigations, according to a statement released by Levin’s office today.

The CFTC, after delaying consideration in September, delayed a final vote on the regulations until an Oct. 18th Washington meeting, Steve Adamske, the agency’s spokesman, said yesterday. The rule has among the most contentious stemming from Dodd-Frank, spurring more than 13,000 comments from supporters such as Delta Air Lines Inc....and opponents including Barclays Capital.

The vast majority of those 13,000 comments came from silver investors recommending a position limit of 1,500 contracts in silver. I thank reader Howard Brown for sending me this Bloomberg story from Wednesday...and the link is here.

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JPMorgan's Dimon's Aggressive Style May Hurt Bank Cause

I ran a Globe and Mail story about this altercation between JPMorgan's CEO Jamie Dimon and Canada's central bank chief, Mark Carney, in this column yesterday.

But this cnbc.com story about this incident is far more detailed.

Masters of the universe are not always so masterful after all.

JPMorgan Chase Chief Executive Jamie Dimon's squabble with the head of the Bank of Canada over bank regulation managed to achieve only one thing — angering the central banker.

Once viewed as a star for helping the U.S. government prop up the now-defunct Bear Stearns during the 2008 financial crisis, Dimon is in danger of becoming a pariah among global regulators.

At a meeting last week between the world's most powerful bankers and Bank of Canada Governor Mark Carney, Dimon tried to tell the central banker that banks were suffering under the weight of all the new bank rules. But his aggression drove a red-faced and visibly angry Carney out of the room, according to people familiar with the encounter.

I thank West Virginia reader Elliot Simon for sending me this cnbc.com story...and the link is here.

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Seth Lipsky: Ron Paul hoists the flag of Hayek and free competition in currency

New York Sun editor Seth Lipsky today recalls a meeting with Austrian school economist Friedrich Hayek and his advocacy of competitive currencies, a position recently put into federal legislation by U.S. Rep. Ron Paul, a candidate for the Republican presidential nomination. Paul's Free Competition in Currency Act, Lipsky notes, would bear heavily on the absurd conviction in federal court of Liberty Dollar founder Bernard von NotHaus.

Lipsky's column is headlined "Ron Paul, Upping the Ante in His Campaign for Liberty, Hoists the Flag of Hayek". you can find it posted at the New York Sun's Internet site.

I thank Chris Powell for wordsmithing the above introduction...and the link is here.

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Merkel Breathes Sigh of Relief: German Parliament Passes Euro Fund Expansion

Chancellor Angela Merkel got the majority she needed on Thursday as German parliament passed the expansion of the euro backstop fund, the EFSF. With fewer conservative renegades than feared, Merkel can breathe a sigh of relief. But with more difficult decisions approaching, the respite may not last.

The expansion of the EFSF still faces some significant hurdles, with several countries left to vote. Most significantly, Slovakia has threatened to reject the expansion -- a move which, given the need for unanimous approval, could torpedo the enlargement of the fund. France passed the expansion several weeks ago and both Finland and Austria passed it earlier this week.

This story was posted on the German website spiegel.de late yesterday...and is courtesy of Roy Stephens. The link is here.

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German bailout vote is 'too little, too late'

Germany's Bundestag has voted overwhelmingly to boost the scope of the EU's rescue fund but implicitly capped its firepower at €440bn, leaving it no clearer whether Europe has the means to halt debt contagion to Italy and Spain.

Chancellor Angela Merkel won her "own majority" for the bill, narrowly averting the collapse of her government, but only after pledging that there was no grand plan committing Germany to vast and unlimited liabilities.

Horst Seehofer, leader of Bavaria's Social Christians CSU, said his party would go "this far, and no further", insisting any expansion of the rescue machinery was out of the question. "The financial markets are beginning to ask whether Germans can afford all this help. We must not risk the creditworthiness of the German state," he said.

This Ambrose Evans-Pritchard offering was posted in The Telegraph just before midnight last night. It's another Roy Stephens offering...and the link is here.

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Peter Oborne 'Idiot' Comments Prompts EU Spokesman To Storm Off Newsnight

An EU Commission spokesman has stormed out of a Newsnight panel discussion on the Eurozone, after the Daily Telegraph columnist Peter Oborne repeatedly referred to him as an idiot.

Osborne doesn't pull any punches here...and this 5:09 youtube.com video sent to me by reader 'David in California' is a must watch. The link is here.

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China ruffles Europe's feathers

The head of the country’s sovereign wealth fund could hardly have been clearer.

"We in China are concerned about the unravelling of the situation in the region," Jin Liqun, chairman of China Investment Corporation – which has $300bn to play with.

"China cannot be expected to buy into high risk in eurozone without a clear picture of debt work-out programmes."

"Sorry if I have ruffled feathers," he said, not looking remotely sorry.

"Over time, economies in the EU will be out of woods. We’re optimistic for the outlook," he allowed. However, nothing can be achieve unless EMU states secure the popular consent of their citizens for austerity policies.

This is another Ambrose Evans-Pritchard piece from yesterday's edition of The Telegraph..and another Roy Stephens offering. The link is here.

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Negative interest rates from short to long will support metals, Michael Pento says

I'm tired of stealing Chris Powell's introduction, so here is the GATA release of this King World News blog...and I'll leave it up to him to do the honours. The link is here.

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Silver to go up hundreds of percent from here: Robin Griffiths

Here's another King World News blog that Eric send me yesterday evening...and the link is here.

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Silver shortages growing and premiums rising: Pat Heller

Coin and bullion dealer Pat Heller reports at Coin Update on the rising premiums...and growing shortages for gold and particularly silver. It's a rather long read, but well worth your time, in my opinion...and the link is here.

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Premiums for gold bars jump to highest since February

Here's a short Reuters story filed from Singapore that was posted over at the India Times on Wednesday.

Premiums for gold bars jumped to their highest level since at least February after a drop in gold prices spurred buying from jewellers and speculators, leading to tight supply in Asia, dealers said on Wednesday.

Premiums for gold bars in Hong Kong rose to as high as $3 an ounce to spot prices from $1.50 last week. In Singapore, the premiums strengthened to $2 from $1.20 a week ago.

"Premiums are rising because refineries are finding difficulty in getting gold to produce bars," said a physical dealer in Singapore.

I thank Nick Laird for sharing it with us...and the link is here.

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We looked into the abyss if the gold price rose further. A further rise would have taken down one or several trading houses, which might have taken down all the rest in their wake. Therefore at any price, at any cost, the central banks had to quell the gold price, manage it. It was very difficult to get the gold price under control but we have now succeeded. The US Fed was very active in getting the gold price down. So was the U.K. - Sir Eddie George, Bank of England, September 1999

It was sort of a nothing day yesterday...another day off the calendar, as Ted Butler would say. But, having said that, it's obvious looking at both the gold and silver charts that rallies in both metals were capped before they could get very far or, as I said further up in this column, it could have been the small Commercial traders [Ted Butler's raptors] selling long positions and booking profits.

For whatever reason, the CME didn't update their website with Thursday's preliminary open interest number for either precious metal. Normally they do it around 1:00 a.m. Eastern, but not this time and, as of 4:56 a.m. Eastern time, the web page was still showing Wednesday's final open interest numbers. I'm sure that the final o.i. numbers for Thursday will posted at their usual time, later in the morning.

The preliminary open interest numbers for Wednesday indicated that the final open interest numbers would show a decline when they were posted yesterday morning. But I must admit that the final o.i. number in gold was still a shocker...down over 12,000 contracts! The price activity on Wednesday didn't justify such a big drop, so it's my opinion that this was 'left over' from Tuesday's trading day...and not reported in a 'timely manner' by the Commercial traders. Too bad it won't be in today's Commitment of Traders Report.

Silver's open interest on Wednesday was also down...1,370 contracts. This won't be in today's COT report, either.

In Far East trading earlier today, gold rose nicely...but a not-for-profit seller showed up at precisely 10:00 a.m. Hong Kong time to put that rally in its place...and not much happened from there heading into the London open. Silver's price path was similar...and both metals are up a bit as of 4:14 a.m. Eastern time. Gold volume is pretty heavy for this time of day, but silver volume is very quiet.

It's still up in the air if there's any more downside to the gold price. Technically speaking, we didn't break through gold's 200-day moving average...but with the cleanout we've had over the last six business days, that may not be necessary. Time will tell.

In silver, we are so far below the 200-day moving average that it's uncertain as to how long it will take before we get back above it. We'll just have to see what the technical funds do...and then what '1 through 8' commercial traders do in response.

Today's much-anticipated COT report will be posted at the CFTC website at 3:30 p.m. Eastern time, sharp...and if you follow that sort of thing, you can click here at the appropriate time. As I said yesterday, it should be one for the records books...and I will be reporting on that in my Saturday column.

I haven't the foggiest idea of what kind of price action we're going to see for the rest of this trading day. But it's the last day of the week, the month...and the quarter, so be prepared for anything.

There's still time to either re-adjust your portfolio...or get fully invested in the continuing major up-leg of this bull market in both silver and gold...and I respectfully suggest that you take a trial subscription to either Casey Research's International Speculator [junior gold and silver exploration companies], or BIG GOLD [large producers], with all our best [and current] recommendations...as well as the archives. A subscription to the International Speculator also includes a free subscription to BIG GOLD as well. And don't forget that our 90-day guarantee of satisfaction is in effect for both publications.

I hope you enjoy your weekend...and I'll see you here sometime on Saturday.