Commitments of Gold Futures Traders show
large speculators (hedge funds and money
managers) reduced their long positions taking
the losses. Net commericial gold traders
reduced their short positions cashing in gains.
Net commercial dealers almost always win
against large speculators, although they have
sometimes to be very patient. Positions are
still very large but we like what we see that
short sellers are satisfied with their gains
As per Dr. Murenbeeld’s Gold Monitor the
speculators on COMEX have finally cut back
on their net-long positions by 159 tonnes
equivalent through last Tuesday. We are sure
long liquidation had further accelerated during
the later part of the week.
The Gold Barometers (attachment 2) reveal
that gold shares are not oversold but are in
neutral territory and physical gold and silver
is in neutral territory and this for weeks already.
The KITCO Gold Survey (attachment 3) indicates
that Wall Street is bearish for this week (53%)
and Main Street (Retail Investors) are about the
same bearish or bullish.
The hourly gold chart (attachment 4) shows gold
not having had a good week with continued downward
pressure. As per close on Friday in New York,
at 4 p.m., gold closed at US$ 1’248 per ounce for
a loss of US$ 32 per ounce on the week. The gold
weekly continuous futures chart shows gold has
support around US$ 1’200 to US$ 1’220 and the
Reverse Head & Shoulder formation, formed since
2013 is still in tact (attachment 5).
The ARCA Gold Bugs daily chart (attachment 6)
indicates gold shares made a reversal on Thursday
and closed slightly positive on Friday. This is good
news, at least for the short term. The HUI 3-year
chart (attachment 7) shows the index has good
support around 160 to 170 points but it must hold
that level. Otherwise the index could revisit the
huge bottomed formed in the second half of 2015
at around 100 points.
Commitment of Silver Futures Traders indicate
that positions have sharply diminished. This is
a great sign. Large speculators reduced their long
positions drastically and net commercial silver
dealers covered shorts in size (attachment 8). If this
trend continues silver could stage a sizeable rally.
Attachment 9 is the Silver continuous futures
Point&Figure chart. The silver price has formed
a bottom around the US$ 14 per ounce level for the
last 3 years. This bottom is only about 10% lower
from current silver prices. Short sellers know this
and having large short positions at potential bottom
prices bear high risk. Hence it is safer not being
exposed on the short side.