Gold COT Report 10/19/12: Commercials Cover 2 Million Ounces of Net Gold Shorts into Raid

Submitted by Marshall Swing:

Gold COT Report 10/19/12

Commercials sold off -2,214 longs and covered a massive -21,819 shorts to end the week with 54.71% of all open interest, virtually unchanged from the previous week in total open interest, and now stand as a group at 24,738,300 ounces net short, a huge decrease of 1,960,500 ounces net short from the previous week. 

 

 

Large speculators were strangled out of -14,413 longs but also added 3,516 shorts for a net long position of 19,402,000 ounces, a decrease in their net long position of -1,792,900 ounces net long over the prior week.

 

The small speculators who had not been adding longs recently were only frisked for -815 longs while adding 861 shorts for a net long position of 5,336,300 ounces a small decrease of -167,600 ounces in their net long position from the prior week.

 

Well, what did not happen on the silver side of the house certainly did happen in gold as it was most assuredly the gold commercials, specifically the producer merchant who instigated the price raids during this reporting period and silver merely followed gold.

 

If you read my silver report, you know that the silver commercials basically sat back and twiddled their thumbs while apparently the gold commercial traders did all their work for them.

 

Other interesting numbers here are the 3,516 shorts purchased by the large specs.  They have been adding short positions for three weeks now and no doubt some of them will get rewarded if not already reaping some profits.  The only question is will the gold commercials let price rise in an attempt to shake out those shorts?  Remember the COT reporting period ended on Tuesday afternoon and price has dropped almost $1 since then so there has been no apparent attempt, since COT close, to punish the speculators who bought short the last 3 weeks.

 

Considering the net short position of the silver commercials, I expect price to continue to deteriorate some into next week if they have not engaged in heavy short coverings today.  Even if the price drop in the metals is due to the silver commercials attacking, today, I doubt it is enough to signal the end of the metal’s downside.

 

Always for your convenience, if you would like to contact the CFTC and express your views to them, I have provided you their phone numbers and I hope earnestly that you fill up their phone lines: http://www.cftc.gov/Contact/index.htm and email addresses as well:

 

ggensler@cftc.gov  Chairman Gensler

 

bchilton@cftc.gov  Commissioner Chilton

 

jsommers@cftc.gov  Commissioner Sommers

 

Somalia@cftc.gov  Commissioner O’Malia

 

mwetjen@cftc.gov  Commissioner Wetjen

 

dmeister@cftc.gov  Director Meister

 

See you next week!

 

Marshall

Comments

  1. Silver’s short positions are increasing while gold’s short positions are decreasing. Also, small physical gold pieces are very hard to find at my local coin shops. Even if my dealer has some, they have a very high premium which is not worth it.

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