Are The Chinese Selling Gold?

Includes: GLD, GXC
by: Andrew Butter

The minute-by-minute dynamics of the recent 10% or so slump in the price of gold since March looks like the big falls appear to be on the Hong Kong market, typically they pick up a bit on the London Market and then they rally on the New York market, then back to Hong Kong where they drop again.

(Click to enlarge)

In the last three days on average:

  • Hong Kong lost 0.9% per day (total 2.6%)
  • London gained 0.3% per day (total 1.0%)
  • New York COMEX gained 0.1% per day (total 4%)

Perhaps the Chinese are selling? Perhaps they know something more about how much Ben will print this June than they do in New York or London or how much of America's trade deficit needs to be financed by selling paper?

Both of those variables are the best explanations for the meteoric price of gold over the past few years, although it's hard to figure out which?

On the subject of insider information, one thing I will say for Chinese trade statistics, is that you get them within a month, I imagine that if you are in the know you can get them quicker - perhaps someone is peaking?

Or there again, perhaps what the conspiracy theorists say is the rigging of COMEX and LME to suppress the price of gold, is working the other way these days?

Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.