Yes, I did see the record short on the S&P. Would suggest the stock market is looking at another significant swoon. The other surprise was the bet they have for not lower interest rates, but higher ones. Huge shorts on the Eurodollar especially, and bets against the T-Note and T-Bonds. More accurately they may be betting that the aggressive discounting of lower rates already built into the futures is just too optimistic. Yes, they aren't especially short the Dollar, except against the Yen.
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But, back to Gold. I've been comparing today's positions with the last time the commercials loaded up, and the specs were heavily short in July, 99, shortly before the explosive Washington Conference rally. At that time the commercials were at a record long position of net 91,960, and specs awaited the coming slaughter with 88,363 net short.
Today we have commercials net 59,488 long, and specs short 57,160. At first blush this is solidly bullish for POG, but not to the extent of July, 99? However, the variable that I'm picking up on is the open interest, which is now a mere 139,000 contracts. I've gone brain dead trying to find the exact OI for July, 99, but have only been able to locate a poor quality chart. It appears to be over 200,000, but maybe someone could bird dog the specific number? But, the point I'm making is that right now we have a much thinner gold market. Arguably this could suggest an even more explosive rally than 99. |
