Dave in Denver writes:
"Brazil's Central Bank announced the purchase of over 17 tonnes of gold in October. Here's the commentary on this from UBS precious metals strategist Ed Tully:
"There may be a flutter of excitement in the market today with news that Brazil's official reserves of gold rose 17.2 tonnes in October, according to IMF statistics. This follows on from the 1.7 tonnes of buying in September and brings total Brazilian gold reserves to 52.52 tonnes. This is a chunky purchase by a central bank, and the gold market will likely sit up and pay attention to today's news, not just because of its size but because this is a central bank that has not been active in the market for some time. Gold struggled in October, and without this official sector buying the move below $1700 would likely have been much more severe than the short lived dips transpired to be. Today's news confirms much of the market chatter at the time that official sector buying was taking place and was one of the key factors that gave prices a reasonable floor last month.
"In fact, several non-Fed/BOE Central Banks increased their gold holdings by over 40 tonnes in October. We know that China, in addition to retaining 100% of the 25 tonnes per month it produces, has been importing bullion hand over fist.
"Gold and silver have been unusually resilient in the face of one of the more overt attempts by the U.S. bullion banks to trigger a COT open interest liquidation sell-off. For those of us who have been trading and researching the metals market for the past 11 years of the bull market, the attempted manipulation has never been more transparent, nor has the ability of the market to withstand this big bank flagrancy. ..."