Submitted by SD Contributor Marshall Swing
SILVER COT REPORT 8/17/12
Commercials added a huge 3,202 longs on the week and an even larger 7,752 shorts to end the week with 46.12% of all open interest, a big leap upwards of +1.45% in their share since last week, and now stand as a group at -117,010,000 ounces net short, a massive addition of 7,750,000 more net short ounces from the previous week.
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Large speculators picked up 897 longs while covering a sizeable -1,011 short contracts improving their net long position to 77,935,000 ounces, an increase in their net long position of 9,535,000 ounces from the prior week.
Small speculators increased 174 net longs and also increased 531 shorts for a net long position of 39,075,000 ounces a decrease of -1,785,000 ounces net long from the prior week.
Commercials went on some long position raids this week exactly as expected (see my article on gold last week).
Remember that the small specs picked up 698 shorts last week. They did not sell like the large specs did. They must have looser stops and are convinced a steeper price drop is on the way and added more shorts this week.
The commercials have made some very large bets. Notice the spreading category for the disaggregated commercials as it swelled by 43% this reporting period. The commercials have added 8,546 short contracts in the last three reporting periods, far outnumbering the longs they have added.
Thursday’s 40 cent jump in price was probably an effort to force the small specs out of their shorts and entice more long buying. As of this afternoon, we have not seen that long buying materializing. If price does not drift upwards Monday and Tuesday you can expect a significant raid to occur. I do not believe there will be significant long buying on the part of the speculators this coming week.
Perhaps the real direction will be told in gold?
As 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/
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
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This quite a big one: China will encourage it’s citizens go for gold?
http://blogs.ft.com/beyond-brics/2012/08/17/sunny-skies-a-glimpse-into-chinas-gold-ambitions/
There is a typo on the article. The number of short contracts added was only 4,752, not 7,752. The rest of the numbers are correct.
Perhaps @the-doc or @bullrun can fix the typo?
While India wants citizen to take on more productive paper investment schemes and get rid of their gold fascination, China would be encouraging citizens to stock up on precious metal?
Why would these two upcoming countries have opposite views?
The shorter they are the harder they fall!
These consecutive contrasting reports confuse me also.
Anyway, should we scrape ourselves for another silver downfall? Or are these large speculators just trying to get rid of dirty money?
I’ve been giving some thought to our situation today vs 2008. Thoughts such as what would the situation of those of us who began to realize in the crisis of 2008 that things were much much worse than we had realized before the crisis. Then came tarp, stimulus packages, QEs. The shock of what was happening woke up a lot of people. People like me and most likely some of the readers of this blog. As much as I have complained about the criminality of the metals manipulation ‘because it is” the money printing… where would many of us that woke up late be if the stimulus and QEs had not bought us these last 4 years of time to prepare? I know that someone, maybe a Japanese or Chinese laborer might get stuck because their gov. bought our bonds. But they got to continue exporting to us with there own manipulated currencies. For those who couldn’t see what was happening in 2008 and couldn’t wake up to facts and get ready, I’m sure the next crash will do the trick! If the Gov.& the Fed had not printed away and yes JP Morgan driving down and keeping down PM prices our preparations would have been much more difficult financially and our stacks much smaller! If the crash had happened in 2008 I think many of us could have been wiped out!!! Those that haven’t made any preparations in the last 4 years most likely will be wiped out next time around.
I don’t think the big commercials adding shorts mean they are predicting lower prices and will profit from them.
I think they add new shorts to prevent prices rising. Profit comes from their paper investments and fees. The shorts are to protect these other rackets, and to protect the entire fiat paradigm. They cover them periodically on dips, in order to clear the books for new shorts to be added as necessary.
@XC-Skater : for the 2nd consecutive week the commercials have increased their net silver short positions while reducing their net gold positions. It appears that in silver, the other commercials have turned against JP Morgan, and JP Morgan is likely the only commercial increasing their shorts. If correct, this is a historic shift over the last several weeks.
Staying locked on the fact that silver is the most shorted, manipulated comodity in human history is enough to convince me I’m on the right track. On track to become the most valuable comodity in human history.
They will never ever get my metals back. Even if I have to pass them on several generations before they can be effectively used.