Gold & Silver COT Report: Commercials Net Short Nearly 300 Million Oz in Silver, 25 Million Oz in Gold

Submitted by SD Contributor Marshall Swing:

Gold & Silver COT Report 11/30/12

Commercials declined 894 longs on the week and increased 712 shorts to end the week with 47.05% of all open interest, a small decrease of -0.18% in their share since last week, and now stand as a group at 283,960,000 ounces net short in silver, which is an increase of just over 8,000,000 net short ounces from the previous week

 

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Large speculators borrowed from their friends and relatives to buy up a massive 3,776 longs but they also added 3,004  short contracts increasing their net long position to 193,665,000 ounces, an increase in their net long position of just under 4 million ounces from the prior week.

 

Small speculators bought into 1,408 longs and added 574 short contracts for a net long position of 90,295,000 ounces an increase of well over 4,000,000 ounces net long from the prior week.

 

The furious buying continued and even increased for the speculators this past reporting period but since Tuesday’s close we saw a shakeout of both speculator longs and shorts with massive volatility in both gold and silver, particularly gold.  The real war has been in gold over the last 3 weeks as we compare the charts.  We will see huge changes of position in next week’s COT numbers.  However, for this week, despite all the position changes in open interest, total open interest was all but stagnant.

 

The divergence of open interest position changes on the part of the speculators in this report tells us we can expect more volatility in the near future as huge short positions were taken by some large speculators.  This divergence creates weakness in the overall speculator long position.

 

In gold…

 

 

Here we do not see the same short positions taken by the large speculators as in silver but we see them taken by the small speculators.  Also note the longs bought by the producer merchant.

 

I believe these longs bought by the producer merchant to be temporary positions that were bought to entice the speculators to buy longs.  These positions were probably sold off right before each of the raids.

 

Again as in silver, we see significant divergence of direction like we have not seen for many months.  This only makes the speculators easy prey for the commercials.

 

As always, for your convenience, if you would like to contact the CFTC and express your views on the commercial trader’s unfair dominant short position, 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:

 

[email protected]  Chairman Gensler

 

[email protected]  Commissioner Chilton

 

[email protected]  Commissioner Sommers

 

[email protected]  Commissioner O’Malia

 

[email protected]  Commissioner Wetjen

 

[email protected]  Director Meister

 

See you next week!

 

Marshall