Gold price ahead of the Thanksgiving weekend
During this period, gold is usually just before forming a short-term top and starting the biggest decline within the final quarter of the year.
Gold on Monday struggled to advance despite the unfolding chaos in the eurozone, a disappointing jobs report in the US ahead of the holiday weekend and a weaker dollar.
In quiet afternoon trade in New York, gold for delivery in August, the most active contract, added $8.30 an ounce or 0.7% from Friday’s close to exchange hands for $1,171.80 an ounce.
Gold is down nearly 10% from its 2015 highs and the pervading negative sentiment – despite all the factors working in the precious metal’s favour – is nowhere more evident than in the positioning of speculators on the futures market.
Last week large gold futures investors such as hedge funds, referred to as “managed money”, slashed overall bullish positions by a whopping 55%.
Bets that prices will rise only amounted to 21,480 lots or 2.15 million ounces in the week to June 30 according to the Commodity Futures Trading Commission’s weekly Commitment of Traders data.
That’s more than 14 million ounces below levels hit in January this year when gold reached its 2015 peak.
The net long positioning is also the lowest since October 2006 when gold was worth less than $600 an ounce.
Speculators’ short positions – bets that gold could be bought cheaper in the future – jumped to more than 9.87 million ounces (283 tonnes).
That is the highest number of bearish bets ever placed on the New York gold futures market.
Source: Saxo Bank
9 Comments
Harris Goerss
Prices to hit $1000 shortly!
otoman
So you are clearly one of those short paper sellers that will get hung out to dry! LOL!
Erik Rouwenhorst
Don’t follow the crowd.
Former Utah Man
“The net long positioning is also the lowest since October 2006 when gold was worth less than $600 an ounce”. Twenty four months later gold was over $1,000 per ounce. Lets hope history repeats itself!
Dee
always go another direction ‘againist’ US dollar if you want to make money out of gold trade
Charles Ryder
Love the illustration – those Nokia phones are about 10 years old. And always go with the oil price?
Rod B
Go figure! Greece is about to default on 260 billion in loans; The western economies are pumping out money like Saudi Arabia pumps oil; Israel is just about ready to drop a nuclear bomb on Iran’s uranium enriching center; 50,000 high-paying jobs in the off-shore and on-shore oil industry have been cancelled in the US during June and 20% of the off-shore drill rigs will be parked in 2015 and 30% more by the end of 2016; China is buying the equivalent of annual gold production; India is importing so much gold that the government has an import tax on it; immigrants and refugees are on the move to new countries by the thousands per hour; Russia is falling apart economically, and discussion about the Euro suggests it may unravel by 2017; ISIS is running amok in the Middle East and Saudi Arabia is bombing the hell out of Yemen. The only thing I don’t see on the horizon is a magnitude 8.2 ground shake in SFO… I can certainly see why people would short gold under the circumstances. Au just popped down to $1,155 this morning… Looks like a good itme to short it some more!
George Allan Bloom
PLACING great importance in COT when there has been 3 days trading once the report is read seems ludicrous. what some are implying is the hedge funds are always correct in position taking and small speculators always wrong. silver may have capitulated yesterday and open interest was added. new sellers and new buyers at this price. i wonder where the buy stops are. i also wonder why silver companies dont sell their spot and buy futures to replace the sold silver at below the cost to produce. then force delivery from the sellers who have no silver.
Anthony Maw
“…negative sentiment – despite all the factors working in the precious metal’s favour…” and “Speculators’ short positions” says it all. The price of gold is a casino like all other commodities is manipulated by large pools of capital and investor sentiment and has ABSOLUTELY NOTHING to do with actual supply and demand. In the modern casino of “capitalism” the derivative trade actually sets the price.