Gold & Silver COT Report 2/22/13: Commercials Cover Astonishing 44 Million Ounces of Naked Silver Shorts!

goldCOTBy SD Contributor Marshall Swing:

Gold & Silver COT Report 2/24/13:

Commercials added 2,026 additional long contracts to their total on the week after tremendous gains last week and covered a huge 6,815 shorts to end the week with 47.11% of all open interest, a huge decrease of 2.35% in their share since last week, and now stand as a group at 189,780,000 ounces net short, which is a decrease of over 44 million net short ounces from the previous week!!!

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Large speculators sold off 1,148 longs and gorged on 4,468 more short contracts decreasing their net long position to 132,280,000 ounces, a decrease in their net long position of over 28 million ounces from the prior week.

 

Small speculators picked up 496 longs and added a huge 3,721 short contracts for a net long position of 57,500,000 ounces a decrease of over 16 million ounces net long from the prior week.

 

The producer merchant unloaded in a big way this reporting period covering shorts and selling longs while the swap dealers bought longs and covered shorts by about the same magnitude.

 

The swap dealer category of the commercials are now net long by almost 11 million ounces.

 

This is the 4th straight week the commercials have added longs.  Over that period they have added about 9,500 longs.

 

What we may have seen on Wednesday, after the COT period, is the speculators dumping short positions for profits while realizing the commercials are in a good position to take price far higher.  Their interest in obtaining profits may have forced some commercials out of some of their new long positions.

 

Gold followed silver with pretty much the same numbers and ratios but the most interesting statistic was the gold commercials percent of open interest dropped 3.7% from 53.99% to 50.29%  Just 3 weeks ago the gold commercials percent of total open interest was 56.49%  Silver bugs like to think theirs is the most insidious manipulation but gold commercials and the gold producer merchant are always a few percentage points higher in net shorts than is silver.

 

Have we seen the bottom to the metals?  No one can say for sure but my guess is the commercial long buying is signaling at least a temporary bottom.  But, just so everyone knows, the week of last May 22 saw the commercials with just 76 million net short ounces and the producer merchant at 153 million net short ounces.

 

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