options expiry is coming up, so the price of gold (and silver) will be held firmly in check (again) until then. since bart chilton is investigating this, someone should mention it to him...oh wait, i already did.

this is from ed steer of casey research:

The day after tomorrow [Thursday, March 26th] is options expiry in both gold and silver for the April contract. It's not a big delivery month for silver...but it certainly is for gold. Nothing would surprise me in the price pattern until then. First day notice for delivery into the April contract is March 31st. Volume in gold trading on Monday was 129,071 contracts with a switch effect of 32,200. The fact that the HUI and XAU finished in the plus column should be considered a triumph. Let's see how they fare today.

Open interest on Friday's activity showed the following changes. Gold o.i. dropped 957 contracts...and silver o.i. fell another 318 contracts. Although JPMorgan et al did their big number on both gold and silver during Globex electronic trading yesterday, I doubt there were a lot of contracts involved. I expect Monday's open interest numbers to show a decline in both metals...but not a big number in either. We'll find out at 1:00 p.m. today.

In an e-mail exchange with Ted Butler yesterday, I got the following information concerning the short positions of the '4 or less' traders [all bullion banks - Ed] in the Commercial category as of last Friday's COT..."in the current COT, as of March 17, the big 4 shorts in silver held a true net short position of 70.2% of the entire Comex silver market (after all spreads are removed). In gold, the equivalent numbers are around 59%, but the gold numbers are much more slippery than silver...For the Bank Participation report as of March 3, the '2 or less' big U.S. bullion banks comprise 45% of the entire net short silver position on the Comex...on a true net short basis. In gold, the '3 or less' U.S. bullion banks are net short 41% of the entire Comex gold market...with all spreads removed." [No manipulation to see here folks...please move along!]

In other gold news yesterday, there were a fair number of deliveries in silver as we approach the end of March. There were two issuers yesterday...Goldman Sachs [186 contracts] and Prudential Bache [102 contracts]. The three big stoppers were Bank of Nova Scotia [129], JPMorgan [102] and Triland USA [46]. There were a piddling 11 contracts delivered in gold. Silver inventories at the Comex-approved warehouses dropped 410,501 ounces. Over at the Zürcher Kantonalbank in Switzerland...their gold ETF added 71,548 ounces last week...and in silver, they added 571,733 ounces. I thank Carl Loeb for that info. The GLD fell about 10,000 ounces...probably a fee payment, and the SLV showed no changes. The SLV custodian, JPMorgan, [the biggest silver short on the Comex] is currently holding almost all the silver its prospectus allows. We await developments.

However, there was a change at The Central Bank of the Russian Federation. In February they added about 200,000 ounces to their considerable reserves...bringing their total reserves up to 16.9 million "fine troy ounces"...as their website says. The other big changes yesterday were over at the U.S. Mint. I was surprised to see that they updated their numbers this early in the week. Their one ounce gold eagle coin mintings rose 29,000 to 96,000 month-to-date...and the silver eagle mintings were an off-the-charts 682,000 for last week, which brings the March silver eagle total to 2,407,000 which is a one-month record production if my memory serves me correctly. There are still eight production days left in March. Will the mint update again...or will they save them for April production? We'll see.