India’s Gold Demand Gets Rolling – An “Unofficial” Bottom?

Our sales have increased by 30-40 per cent over the last week following a decline in gold prices. Given that the current price level will continue, we see this season as one of the best festive seasons in terms of jewellery sales in recent years,” said Rajesh Mehta, managing director, Rajesh Exports, one of the largest jewellery retailers in India. – LINK, as sourced from John Brimelow’s “Gold Jottings”

I say “unofficial” bottom to this 9-week manipulated take-down in the price of gold because we don’t know to what extent the western Central Banks will throw paper at the NY and London gold “markets.”  But based on the latest Commitment of Traders report, the bullion banks are covering their shorts fairly aggressively while the moronic hedge funds dump their longs and try to chase the market lower by piling in to the short side. This has always been a recipe for at least short term move higher in the metals.

But the cartel’s takedown of the paper gold price has created a nice ex-import duty premium bid in the Indian gold market just ahead of India’s festival season:  “Dropping of the rates depend on the international market. If it continues, we are sure to have a bumper Diwali this year,” said N Anantha Padmanabhan, regional chairman, All India Gems and Jewellery Federation – LINK.

Please note that a sudden surge in legal kilo bar imports will not depress dore bar importation or smuggling, the latter of which is now estimated to fill about 30% of India’s annual gold demand now.

Recall that China was closed last week, while India was transitioning into it’s biggest buying season.  The banks used this opportunity to launch their most aggressive paper attack on gold since 2011 in London and on the Comex.   They also used the big drop last week to print profits at the expense of hedge funds and whiny retail bucket shop traders. But, the western gold cartel take-down of gold using paper has helped ignite India demand:  “In the past fortnight, gold has fallen in the international market by 5.8 per cent; the price in India is down 4.9 per cent. With the ‘pitrupaksha’ period over, when buying of gold is considered inauspicious, festive demand has started LINK.

With the bullion banks covering their illegal paper shorts, gold is the most oversold that it’s been in 3 years.  I suggested several weeks ago that we might get a “200 dma” pullback. Here it is:

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Again, I’m calling an unofficial bottom because, in a system that allows a criminal to run for President, there’s not telling the degree to which Wall Street will resort to illegal market manipulation in order to keep a lid on the price of gold. But  I am certain that the Indians, Chinese and Russians will – as Alan Greenspan would say – “measurably” increase their “consumption” of physical gold.

I will be reviewing and updating my favorite junior exploration picks in this week’s Mining Stock Journal.  I am featuring some graphs which reinforce my view that this sell-off is over, with the market “percolating” for another big move higher – possibly ahead of the next Fed policy move, which I believe will entail more QE.  I am also going to present some ideas to take advantage of the oversold condition of the highest quality large cap mining stocks.   You can subscribe to the Mining Stock Journal with this link:  MSJ Subscription. This includes email delivery of all back-issues.  The last issue featured a silver explorer trading below 50 cents that could ultimately be a $10 stock.

6 thoughts on “India’s Gold Demand Gets Rolling – An “Unofficial” Bottom?

  1. Sorry to be off topic Dave but the DJ today, that dump at the close, seriously if people can’t see what’s happening…IMO…if you’re not trying to convert at least 60% of your wealth into tangibles’ you’re going to get reamed ….the relentless smashing of AG IMO is about to bite the biggest players right on their ass….JMO

    1. My friend’s parents woke up when they saw Bush, McCain and Ryan telling the public they were voting for Hillary Clinton. It cemented their vote for Trump

      1. Dave, I’ve gotta’ be honest , I really like Mr Trump..if for no other reason
        than showing up the whole corrupt system for what it is..even though I cant
        vote& probably should not comment..really the same parasites are in power
        the world over…I suppose the irony being that the “elite” never see the punch in the face coming…The Bastille being exhibit A….most of them and their apparatchiks too stupid to realise now might be a great time to pull up stumps and leave Dodge…too quote that picture “Southern Comfort” “They’re dug in deeper’n ticks’ on a hogs’ back”

  2. At some point, people will demand their paper gold be converted into the real deal. When that transpires, the value of physical gold and silver will be over the moon. Not a matter of if, but when. We’re getting close – the ongoing criminal paper metals manipulation must collapse.

  3. You can’t forget names of other DISGUSTING FASCISTS like Mitt Romney, Lindsey Graham, Mitch McConnell, Peter King etc being outed this time around, along with usual war criminal names like Dick Cheney.

    Having said that, due to the presence of other FASCIST rats like Rudy Giuliani, Chris Christie, New Gingrich etc. that surround him, there is no way I could consider voting for Trump. Guilt by association. Over & above Trump’s disregard for civil rights & so the Constitution in general. Even if he manages to make it out alive (literally & metaphorically), there’s no way Trump could be his own man. He would be well controlled by Military Industrial Complex alright.

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