CME Raises Gold, Silver, Copper Margin Requirements – Gold Margin Increases Since Aug. 11 Total 55%

See also:
Gold And Silver Plunge-Fest – Case Closed: CME Hikes Gold, Silver, Copper Margins


“CME raised gold margins twice in August. Including the increases that take effect Monday, the margin increases since Aug. 11 total 55%.”

CME Raises Gold, Silver, Copper Margin Requirements (Wall Street Journal, Sep. 24, 2011):

Exchange operator CME Group Inc. will raise the collateral requirements for trading in gold, copper and silver futures after a volatile week.

Gold margins will be raised by 21%, silver margins by 16%, and copper margins by 18%, effective at the close of trading Monday, CME said in an email after trading closed Friday.

Following the change, speculative investors in the benchmark 100-troy ounce gold contract must put up $11,475 to open a position and maintain $8,500 of that to keep it overnight. Producers and consumers of the precious metal must put up $8,500 to open a position, and the same figure to hold it overnight.

Read moreCME Raises Gold, Silver, Copper Margin Requirements – Gold Margin Increases Since Aug. 11 Total 55%

Gold And Silver Plunge-Fest – Case Closed: CME Hikes Gold, Silver, Copper Margins

Gold Liquidations Open Thread (ZeroHedge, Sep. 23, 2011):

Update: Yep – it was a leak of a margin hike as just confirmed. Which may very well mean nobody actually had to liquidate, just the herd thundered, as it always does, in the wrong direction. Expect gold to actually rise on this news.

Everyone knew they were coming… Just not when. Now that the gold liquidation frenzy has struck we still don’t know much if anything: who was it, why, and where did the money go? Some rumors have it as a bank in Central, Eastern Europe unwinding massive PM positions, which if true is paradoxically bullish for gold and silver as reported previously, as it means the already tight liquidity situation in Europe is about to come to a head, possibly as soon as this weekend. Others speculate it was a plain vanilla satisfaction of collateral requirements by a big funds who may or may not be liquidating and who have sizable gold positions. Or, the simplest explanation, was it simply an expectation (and leak) of a gold margin hike?

Case Closed: CME Hikes Gold, Silver, Copper Margins (ZeroHedge, Sep. 23, 2011):

And there you have it: CME just hiked gold margins by 21%, silver by 16% and copper by 18%. Mystery solved.

Gold Margin Hike 9.23

Gold/Silver Plunge-fest (ZeroHedge, Sep. 23, 2011):

Gold down over $100, and Silver down over 15% – someone is liquidating. Rumors vary from very prominent hedge funds to Central European (as in geographically) central banks. Bottom line is, it is a self-fulfilling prophecy at this point and will continue until every last seller is out, and until the margin calls end.

UPDATE: Silver <$30 -17%

Charts: Bloomberg

The Sun Unleashes Coronal Mass Ejection (CME) At Earth

Earlier this morning, NASA’s Solar Dynamics Observatory (SDO) witnessed a complex magnetic eruption on the sun. The joint NASA/ESA Solar and Heliospheric Observatory (SOHO) — a mission sitting at the L1 point between the Earth and the sun — also spotted a large coronal mass ejection (CME) blasting in the direction of Earth.

It is thought that the SDO and SOHO observations are connected, making this a global magnetic disturbance affecting the whole of the Earth-facing side of the sun.

The eruption happened at around 0855 UT (3:55 am EST), when the SDO detected a C3-class solar flare originating from a cluster of sunspots (called sunspot 1092). This isn’t a large flare, but right at the same time, a filament located about 100,000 kilometers from the flare also erupted.

A “filament” is a long magnetic structure rising high above the surface of the sun filled with cool plasma. Because it is cooler than the sun’s chromosphere, when in the direct line of sight between the Earth and sun, it appears as a dark ribbon snaking across the sun’s disk. If a filament is spotted on the limb of the sun (i.e. on the side), it appears as a bright prominence arcing high into the sun’s atmosphere.

Judging by the timing, the flare and the filament erupted at the same time, suggesting they are connected via long-range magnetic field lines. The resulting shockwave emanating away from the flare site may have had a role to play in accelerating the filament when it hit the filament’s eruption zone.

Watch the video of the eruption as seen by the SDO:

C3events_strip

This sequence of events led to a huge magnetic bubble of plasma being blasted into space. As the eruption was on the Earth-facing side of the sun, the CME is heading right for us — see the SOHO video of the CME. We can expect its arrival on Aug. 3.

Skywatchers will be on high alert that day as when that CME intermingles with the Earth’s magnetosphere, we can expect some intense aurorae around polar regions.

Far from being a frightening event, this morning’s complex solar eruption — including a flare, shockwave, filament eruption and CME — is a testament to the technological ingenuity of the solar scientists and engineers who have designed the powerful solar missions that continually monitor our tumultuous star. Now we know a CME is coming, we can prepare for its arrival.

Read moreThe Sun Unleashes Coronal Mass Ejection (CME) At Earth

Solar Cycle 24 Begins

Jan. 10, 2008: Hang on to your cell phone, a new solar cycle has just begun.

“On January 4, 2008, a reversed-polarity sunspot appeared-and this signals the start of Solar Cycle 24,” says David Hathaway of the Marshall Space Flight Center.

newspot_strip.jpg
Above: Images of the first sunspot of Solar Cycle 24 taken by the NASA/ESA Solar and Heliospheric Observatory (SOHO).

Solar activity waxes and wanes in 11-year cycles. Lately, we’ve been experiencing the low ebb, “very few flares, sunspots, or activity of any kind,” says Hathaway. “Solar minimum is upon us.”

The previous solar cycle, Solar Cycle 23, peaked in 2000-2002 with many furious solar storms. That cycle decayed as usual to the present quiet leaving solar physicists little to do other than wonder, when would the next cycle begin?

The answer is now.

Read moreSolar Cycle 24 Begins