5 replies to this topic

[SilentOne]

Gold short positions going well beyond levels when the sector posted its Dec. high, matching levels achieved at the May'06 highs. See how early Oct. was a good entry level for the metals?

cheers,

john

[S.I.M.O.N.]

i would'nt read too much into those numbers, most of those short positions are mine, and everyone knows i'm about to get stopped out sending gold to da moon/sun/cygnus...etc

[Rock]

Silent, Thanks for posting the COTs. I didn't realize it was getting THAT late in the run. Definately a worry. BUT last spring the HUI rose sharply for 5 more weeks after the COT hit these levels. I will probably start scaling out of my jrs soon. Paul

[Tor]

norchini I feel that I should warn you to begin expecting the appearance of the usual top callers in the metals market basing their predictions of demise and ruin for the metals once again on a shallow understanding of the COT Report. These guys might be called the “Ex Lax” of the gold market since they are designed to aid regularity. Like a plague that predictably descends on the gold community, they urge the expulsion of long positions just as the beleagured shorts are on the ropes. It never fails! This time around they are worried about record levels of open interest. What these short sighted analysts do not comprehend, is that while open interest at the Comex has reached a new record high point for this 6 year bull market in gold, the actual number of fund net longs and commercial net shorts is NO WHERE NEAR historic peaks whether measured by outright numbers of by percentage base. Besides, it should be obvious, any and all bull markets in history are always accompanied by huge levels of open interest. That is what makes price go up for Pete's sake – interested speculative activity! The difference in the open interest totals is coming from the SPREADERS category. That is why the total open interest continues to increase without the individual category commitments approaching levels where in the past temporary price peaks have occured. Note the following gold COT charts and compare well the current levels of commitment by the speculators and commercials to previous levels marking tops in the market. My advice, ignore these ego-maniacs and their seeming morbid fascination with calling tops in the metals and let the market tell you what to do and when to do it. You will end up making a whole lot more money.

[SilentOne]

pnf,

i would'nt read too much into those numbers, most of those short positions are mine, and
everyone knows i'm about to get stopped out sending gold to da moon/sun/cygnus...etc

The only thing I would attempt at this point is a short on something like GDX. The metals can bang higher, while the shares diverge technically from here (ie. weaken). March still holds a key astro turn date and likely high for the year. I just don't know what that will be so I would rather pass on that speculation. But as we get throught the spring equinox, I will feel more confident on which trade to make. At that time, I may actually enter a metal short to hedge my bullion positions.

cheers,

john

Edited by SilentOne, 18 February 2007 - 03:57 PM.

[SilentOne]

Paul,

Silent,
Thanks for posting the COTs. I didn't realize it was getting THAT
late in the run. Definately a worry. BUT last spring the HUI rose
sharply for 5 more weeks after the COT hit these levels.
I will probably start scaling out of my jrs soon.
Paul

It is the large spec (read: hedge funds) positions that you have to watch. They always get it wrong. The commercials taking the short side just accomodate the long speculation. Nothing less, nothing more. So at some point there will be a liquidation. There always is.

cheers,

john