Submitted by SD Contributor Marshall Swing:

Gold COT Report 10/5/12

Commercials sold off -8,256 longs and covered 1,341 shorts to end the week with 56.33% of all open interest, virtually no real change from the previous week in total open interest, and now stand as a group at 26,927,000 ounces net short, an increase of 691,500 ounces net short from the previous week. 

 

Large speculators continued their seventh straight week of long buying by picking up 5,440 longs and also 1,010  shorts for a net long position of 20,832,600 ounces, an increase in their net long position of 443,000 ounces from the prior week.

 

The small speculators added a miniscule 122 longs while covering a huge -2,363 shorts for a net long position of  6,094,400 ounces an increase of 248,500 ounces in their net long position from the prior week.

 

While the commercials, as a whole, have been engaging in massive profit taking the last couple of reporting periods it appears they have leveled off on their short position accumulations and we saw the evidence of significant short covering raids this past Friday and continuing into Sunday in Asia.

Looking at the sheer numbers of short positions acquired in recent weeks by those commercials and comparing those numbers to the raids we have seen, it is clear they have only expended a fraction of their powder and we might expect other movements to the downside in the near future.

 

The -2,363 shorts covered by the small speculators is very significant as that is much higher than the 1,546 shorts they acquired the prior reporting period.

 

Another very telling number is the swap dealers only adding 143 longs this period after adding 5,443 the prior period.  That might be tipping their hand that they do not see any profit to be made at higher silver prices and supports the idea that the commercials, as a whole, have a ton of shorts awaiting near term raids.

 

This is my quote from last week’s report:

 

“Taking all the numbers into account, I did not think we have seen the last of near term short covering raids to the downside as the numbers accumulated by both commercials at these levels would not have been used up in Wednesday’s raid.”

 

Indeed we saw a raid but not the significant raid I was expecting.

 

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

  1. Mind-boggling numbers. :o

    I think it’s quite clear that the Cartel will never relent. (Ted Bulter is wasting his time with the CFTC)

    There are only two outcomes: (1) the Cartel will be able to permanently control the price of gold/silver or (2) the market will have to buy enough physical to break the Cartel decisively (think London Gold Pool).

  2. They walk a tight rope. Too cheap and the scrap bidness slows while stackers buy it all up, too high and everyone else starts piling on, buying it all up.  (See spring, ’11)  They like the sideways puttering, for now.  $34 is the arbitrary cap, for today.
    This idiocy can’t last forever.  BTD.  (This market is more important than anyone at the top likes to admit)

  3. Thank you for the link. In order for December contracts to hit, there must be some moving and shaking prior. This confirms the dates for their plans. There is major upheaval between now and December for the short positions to hit. They also have huge bets on November as well. Not a good sign for the dumb and dumber.

  4. With all the raids, they’re amounting to nothing more than a hill of beans and and over-exposed short position.  With silver, in particular, we’ve already seen a pattern that resembles the first stage of an evolving commercial signal failure — an intermediate-term defeat of the cartel.  With all their huffing and puffing their attacks since early September haven’t been able to keep silver under $34 for anything more than a few hours to a day or so. 
     
    Physical demand is simply too strong and the cartel is going to retreat, letting silver move higher (into the low $40s in under 30 days).  It’s 9pm EST as I type and spot silver is once again over $34.  See this for what this represents, friends.  It’s nothing less than astounding.  The cartel has been attacking like mad for the better part of a whole month now, ripping out not only the kitchen sink but taking much of the rest of the plumbing out of the walls and hurling it at the paper markets.  Yet even through one of the fastest additions of short interest we’ve seen throughout this entire bull market, the cartel has little to show for its effort.
     
    I believe we have been witnessing the initial stage of an evolving commercial signal failure and a retest of $35 will likely come tomorrow, Oct. 9th, now that holiday trading is over. By this weekend, we’ll be looking at $35 in the rear-view mirror and everyone and their dog will be contemplating $37.50.
     
    Even if I’m wrong, the downside risk is tolerable given tremendous demand for physical and we’re eventually going up in the weeks and months ahead regardless.
     

    • I agree. I think there will be a few more peaks and valleys in the USD Index to sway the prices of AU and AG. By the end of the year, can they keep the price of AU at 34.00? We ll, we have many more trading days left in the year. Ok. now for the outside the box look at this. 

      How would the silver price react to a hot war in Iran, earthquake in the West or Midwest CONUS? Would this initially hurt the dollar? By December, could we see an unraveling to the anti-petro dollar movement? Could a huge USD Index rally move PM’s to their December strike prices?

      So yes, we can see good moves in AU in the next 4-6 weeks, all things remaining the same, but something out side of the box must happen to lift the USD and that could be the supply and demand of oil.

      Oil is the tool which they will manipulate the USD Index and PM prices. This is where we are headed if you heard Romney at VMI today. Obama is toast. He is gone and Romney is in. This will bring back oil big time in the plans of the PTB. They need 150.00 oil to bring in Gull Island with the Keystone pipeline. They need a supply shortage. The refinery fire on California is devastating the gas prices there….some everywhere. It took only 60 days for gas price hikes and shortages. This is a clue for the rest of us if Hormuz is closed.

      The fact that Libya has fallen and for all practical purposes is being set up for total European control of the their oil (France, Southern Europe), and a substitute pipeline across United Arab Emirates is in place, and there are some 3-5 US Carrier Battlegroup’s in the Hormuz Straits tells me that they almost have in place all the price controls to manipulate the oil price away from OPEC by closing Hormuz!

      I can not leave out oil when considering the massive short positions for November and December, not with shelling from Turkey into Syria and a false flag in Bengazi. They want Iran to close Hormuz…they want the war with Iran to control oil and keep the petro dollar? Control of currencies and oil gives them a license to control the everything else?

    • We should be happy that we have the cartel because we were able to buy some gold and silver very cheaply even with high demands! That moment of opportunity is disappearing as the cartel are not capable of crushing their prices. We just have to wait and see for the results of gold and silver.

  5. Wow! With so many fake paper silver, the commercials are still not noticed and investigated. Today, the gold and silver ratio should be at 16 ounces of silver for one ounce of gold. Why? Because the Hunt Brothers proved to everyone that if they buy all the paper silver from the silver market, physical silver will be left and it will show its real price.

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